For some middle-income families the increased premium from pulling the individual mandate is going to cancel out the tax cut they would get
Sunday Puzzle: “Which Health Plan Is Cheaper?
Doing a thorough comparison of health care plans is difficult.
But there is an imperfect, yet fairly, simple way to check whether a high-deductible plan might qualify for “no-brainer” status, meaning, it enables you to save on health care no matter how often you go to the doctor.
Here’s how to do it: https://www.nytimes.com/2017/11/04/business/which-health-plan-is-cheaper.html ”
“Democrats and other ACA advocates are arguing that eliminating the penalty would hurt lower-income Americans because fewer people would buy coverage overall – about 13 million fewer Americans over a decade, according to the Congressional Budget Office.
But that argument assumes that Obamacare plans aren’t attractive enough for people to keep buying them voluntarily. It seems unlikely that low-income Americans eligible for subsidies would drop their coverage without the mandate — because they’d still be able to access the same subsidies as before. The ACA is designed to make coverage affordable for people in the lower-income brackets by shielding them from the full cost of premiums.
But there is definitely a segment of the population that could suffer without the mandate. The people who are already bearing all the costs of Obamacare plans. These are the people who earn too much to qualify for a subsidy (that is, who earn at least 400 percent of the federal poverty level) and must therefore endure the full brunt of premium hikes.
In the absence of the mandate, some healthy people who don’t feel they need coverage would probably drop out of the market, resulting in higher premiums for everyone else. The CBO has said that average premiums in the individual market would increase by about 10 percent in most years, were the mandate struck from the books.
Collins expressed precisely this fear yesterday on CNN.
“The fact is that if you do pull this piece of the Affordable Care Act out, for some middle-income families, the increased premium is going to cancel out the tax cut they would get,” she said.” (A)
“In the Affordable Care Act and other subsequent reforms, Congress directed the Department of Health and Human Services to test new ways to pay for health care, challenging health care providers, hospitals, and private insurers to provide better care for less money. Under President Trump and former HHS Secretary Tom Price, that work slowed and, in some cases, stopped altogether. With Price out the door, the nominee to replace him, Alex Azar, should commit to righting the ship.
Congress passed payment reforms to test several simple but powerful notions: First, paying doctors and other health care providers for the quality of their care, not just the number of tests they order, ought to improve the health of their patients. Second, keeping patients out of hospitals and other institutions ought to lower costs. Third, preventive strategies should keep people healthier and lower costs. Finally, holding health systems accountable for quality and total cost of care ought to drive innovation.
Achieving those goals would make Americans healthier and help us save on the more than $3 trillion we spend on health care every year. We far outspend the most expensive, universal coverage health care systems in the world, and we aren’t getting better results. Our life expectancy is comparable to Chile and the Czech Republic. More than 250,000 Americans die due to medical errors every year.
Under Price’s leadership, HHS walked away from addressing these problems. He proposed canceling or shrinking Medicare programs to prompt innovation in joint replacements and cardiac care, which could lower costs across the health care system. In September, under Price’s instruction, Medicare chief Seema Verma signaled a “new direction” for the Center for Medicare and Medicaid Innovation, which Congress set up to test promising new ways to improve care and reduce system-wide costs. Instead of vigorously pursuing that mission, the Innovation Center is now looking for ways to loosen protections for Medicare patients, pushing payment systems that would allow unlimited charges for medical services, and even voucherizing the program for seniors. Apparently, the agency’s “new direction” is backwards….
Failing to align incentives in our health care system has real, lasting, life-or-death consequences. Azar needs to convince Congress that he will correct the course that Price set and renew HHS’s commitment to lowering health care costs and improving quality. The American people deserve better than the inefficient and costly system we have today.” (B)
“So the mandate’s repeal leads to a smaller, more expensive insurance market. The mandate is designed, after all, to bring healthier people into the market — without it, we would expect the remaining customers to be sicker and therefore cost more.
Alexander-Murray doesn’t really take any steps to address those problems. The stabilization bill is actually dealing with a whole different set of issues, brought on by Trump’s overt sabotage of the health care law….
Alexander-Murray is best thought of as an attempt to mitigate the damage that Trump has already done to Obamacare’s insurance markets. But repealing the mandate in the tax plan would erode the markets even further, and this other bill doesn’t have any provisions designed to address that new harm.
“The primary benefit of Alexander-Murray would be symbolic. It would be a sign that some bipartisan effort aimed at stabilizing the insurance market is possible, potentially boding well for future efforts,” Larry Levitt, senior vice president at the Kaiser Family Foundation, told me. “But, beyond the symbolism, it really wouldn’t do much to offset the effects of repealing the individual mandate, and could arguably even make things worse.”
That’s because most states and health insurers found a way to price their plans after the loss of cost-sharing reductions so that they actually yielded better deals for many Americans who buy insurance through Obamacare. If Alexander-Murray were passed, it would make those strategies unnecessary, eliminating these cheaper deals for people.
Then when you add in the repeal of the mandate, and the resulting rise in premiums, you have a market that might be even worse off than if Republicans had simply repealed the mandate and not passed Alexander-Murray.
The exact effects can be debated and might be simply unknowable. But what we can conclude, according to these experts, is that passing Alexander-Murray won’t be nearly enough to negate the consequences of repealing the mandate….
Senate Republicans are taking advantage of the superficial logic — repealing the mandate and Alexander-Murray both affect the insurance market, so it makes sense to tackle them at once — to paper over the fact that the tax bill and the stabilization bill are actually dealing with two totally different issues within the health care law.” (C)
“Moderate Republicans like Sens. Susan Collins (Maine) and Lisa Murkowski (Alaska) have said passing Alexander-Murray could help ease their concerns about the destabilizing effects of repealing the mandate in tax reform.
However, Collins said Sunday she wants Alexander-Murray to pass before the tax bill does, which would likely not be the case if the bill waited until the end-of-the-year package.
Experts say that passing Alexander-Murray would not fully offset the effects of repealing the individual mandate, though, which the Congressional Budget Office estimates would increase premiums by 10 percent.” (D)
“Sen. Lisa Murkowski (R-Alaska) said she would support repealing the Affordable Care Act’s individual insurance mandate, giving a potential boost to the Republican effort to pass a massive tax cut package next week.
“I believe that the federal government should not force anyone to buy something they do not wish to buy, in order to avoid being taxed,” Murkowski wrote in an opinion piece published Tuesday by the Fairbanks Daily News-Miner.” (E)
“There are a variety of proposed alternatives to the ACA’s individual mandate to give people incentives to get and stay insured.
One way is to impose a penalty for people who wait to enroll in the form of higher premiums, similar to Medicare Part B. Following that model, the House GOP’s ACA repeal-and-replace bill this year proposed a one-time, 30% premium surcharge for people who enroll following a gap in coverage…
Another approach is to automatically enroll uninsured people in a health plan, giving them the option to drop out…
Other possibilities include requiring people who have not maintained continuous coverage to wait for a set period of time, say six months, before they can enroll in a plan. That was the approach proposed earlier this year in the Senate Republicans’ Better Care Reconciliation Act, which did not pass.
It’s widely agreed that the ACA’s individual mandate penalty—currently $695, or 2.5% of household income, whichever is greater—has not been as effective as hoped in prodding younger and healthier people to buy coverage. But it’s unclear whether any of the alternatives on their own would be as effective as the mandate without costing the federal government significantly more money.
A recent analysis by Wakely Consulting Group found problems with each of the alternative approaches. Several of those models, including late-enrollment penalties and enrollment waiting periods, could actually worsen the risk pool by giving healthier people incentives to put off buying insurance.
Auto-enrollment could boost enrollment among younger people, but it would be logistically difficult to implement because there’s no existing database of those who currently are uninsured…”(F)
“Despite the efforts of President Trump and many congressional Republications to repeal and replace the ACA in 2017, it is still the law of the land. Therefore, marketplace plans are again being offered for 2018.
However, the Trump administration did make some changes that could make it more difficult for consumers to sign up for healthcare coverage or deter them from doing so. This could result in fewer Americans being insured.
Here’s a look at seven specific steps the administration has taken.
1. Shortening the enrollment period.
2. Making changes to qualifying events.
3. Decreasing the amount spent on advertising ACA plans.
4. Decreasing the number of navigators.
5. Planning more maintenance outages on the exchanges.
6. Collecting unpaid premiums.
7. Canceling a subsidy to insurers that lowers consumer costs.” (G)
“Not-for-profit executives are concerned the Senate bill would hurt hospital capital financing by prohibiting advance re-funding of prior tax-exempt bond issues, which made up about 25% of the municipal tax-exempt bond market in 2017. The House GOP tax bill passed earlier this month goes further, eliminating all tax-exempt municipal bond financing starting next year. That’s projected to save the government nearly $40 billion….
Beyond that, healthcare industry groups fear that the Senate bill’s repeal of the Affordable Care Act’s individual mandate would sharply increase the number of uninsured patients. And they foresee Congress later pushing for big Medicare and Medicaid cuts to reduce the $1.5 trillion bump to the deficit that would result from passage of the tax-cut bill.” (H)
“The White House is trying kill Obamacare. Americans are throwing it a lifeline.
Despite the Trump Administration’s promises to “repeal and replace” the Affordable Care Act, enrollment for health insurance under the program is quite healthy with less than a month to go in the current sign-up period, according to the Centers for Medicare & Medicaid Services, a federal agency.
“In week three of Open Enrollment for 2018, 798,829 people selected plans using the HealthCare.gov platform,” the agency reported.
That brings the total number of enrollees in this period to 2.3 million, which is almost 900,000 people — or 64 percent — more than the number of customers who signed up during the first four weeks of enrollment in 2016, according to CNBC.
The figures included more than 566,000 new consumers and 1.7 million renewals, with total Healthcare.gov users exceeding 8.1 million.” (I)
“In a health care system teeming with fine print, here’s an oddity that middle-class people who buy insurance on their own, rather than through an employer, need to know: You might want to take a pay cut next year.
Consider the situation of a 63-year-old married couple with a projected household income of $70,000 next year. The lowest-cost health plan they can buy in Milwaukee County will cost them $24,034.80.
If that couple’s income falls to $60,000, however, the same health plan would cost them $24.
That’s not a typo. It’s the total premium for the year.
The difference: At $60,000, they’ll qualify for a federal subsidy. At $70,000, they won’t.
“The disparity between the cost of health insurance for people eligible for the subsidy and middle-class people who are not is huge,” said Larry Levitt, a policy expert at the Kaiser Family Foundation.” (J)
“Why have Republican leaders set their sights on health care again? They have a serious accounting problem on their hands. Congressional leaders and the Trump administration want to give corporations and wealthy families a giant tax cut, but they have committed to not adding more than (a whopping) $1.5 trillion to the federal deficit over the next decade. So they’re trying to increase revenue by raising taxes on many middle-class families and would compound that harm by cutting spending on things like health care, all in service of further enriching the wealthiest Americans through a plan they’re selling as a break for the middle class. We’d say you can’t make this stuff up, but it turns out they can.” (K)
(A) The Health 202: Republicans are right. The individual mandate is a tax on the poor., by Paige Winfield Cunningham, https://www.washingtonpost.com/news/powerpost/paloma/the-health-202/2017/11/20/the-health-202-republicans-are-right-the-individual-mandate-is-a-tax-on-the-poor/5a0f2dc030fb045a2e003215/?utm_term=.de5336388219
(B) Alex Azar must commit to ‘righting the ship’ for health care payments, By SHELDON WHITEHOUSE, https://www.statnews.com/2017/11/20/alex-azar-health-care-payments/
(C) The cockamamie health care scheme Senate Republicans are using to pass their tax bill, https://www.vox.com/policy-and-politics/2017/11/21/16679274/senate-republican-tax-plan-alexander-murray
(D) GOP senator: ObamaCare fix could be in funding bill, by BY PETER SULLIVAN, http://thehill.com/policy/healthcare/361218-alexander-bipartisan-obamacare-fix-could-be-in-funding-bill
(E) Republican Sen. Lisa Murkowski announces support for repealing individual mandate, a potential boost to tax overhaul, by Damian Paletta, https://www.washingtonpost.com/news/business/wp/2017/11/21/republican-sen-lisa-murkowski-announces-support-for-repealing-individual-mandate-a-potential-boost-to-tax-overhaul/?utm_term=.1d2a1d95ca98
(F) While axing the ACA mandate, why not replace it with a different coverage incentive?, by Harris Meyer, http://www.modernhealthcare.com/article/20171120/BLOG/171129994
(G) Open enrollment: 7 ways Trump’s actions could impact uninsured rate, by Karen Appold, http://managedhealthcareexecutive.modernmedicine.com/managed-healthcare-executive/news/open-enrollment-7-ways-trump-s-actions-could-impact-uninsured-rate
(H) Looming Senate tax bill vote making healthcare leaders uneasy, by Harris Meyer, http://www.modernhealthcare.com/article/20171121/NEWS/171129971
(I) AMERICANS SIGN UP FOR OBAMACARE IN DROVES AS TRUMP TRIES TO KILL OBAMA LEGACY, by CELESTE KATZ, http://www.newsweek.com/obamacare-affordable-care-act-open-enrollment-repeal-replace-721850
(J) Making an extra $10 could cost you $24,000 more for health insurance, by Guy Boulton, https://www.jsonline.com/story/money/business/health-care/2017/11/24/few-dollars-can-determthe-same-health-plan-can-cost-middle-class-couple-24-034-year-24-year-cost-sam/893295001/
(K) When a Tax Cut Costs Millions Their Medical Coverage, https://www.nytimes.com/2017/11/24/opinion/republican-taxes-healthcare.html?_r=0