Women could pay more for insurance again under TrumpCare

As the prospect began to sink in of losing access to free contraceptives if the health law is repealed or replaced, women have reportedly been racing to get IUDs or stockpile birth control pills before President Barack Obama leaves office. But birth control is just the beginning, advocates say. There are a number of other women’s health benefits that are also at risk.

At or near the top of the list is guaranteed coverage of maternity services on the individual insurance market. Before the health law, it was unusual for plans in the individual market to pay for maternity services. But the Affordable Care Act required that care be included as one of the 10 essential health benefits that all individual plans must cover. In 2009, the year before the health law passed, just 13 percent of individual plans that were available to a 30-year-old woman in all the state capitals offered maternity benefits, according to an analysis by the National Women’s Law Center.

Some plans offered maternity services as an add-on through a special rider that paid a fixed dollar amount, sometimes just a few thousand dollars, the study found. But even with a rider, a woman’s financial exposure could be significant: The average total payment for a vaginal birth was $18,329 in 2010, according to a study by Truven Health Analytics.

Women were also generally charged higher rates for health insurance on the individual market before the law. According to the National Women’s Law Center’s analysis, 60 percent of best-selling individual plans in 2009 charged a 40-year-old non-smoking woman more than a 40-year-old man who smoked, even in plans that didn’t include any type of maternity coverage. That inequity disappeared under the health law, which prohibited insurers from charging women higher rates than men for the same services.

“Our concern is going back to a world where insurance companies are writing their own rules again, and returning women to those bad old days in healthcare and losing all the progress we’ve made,” said Gretchen Borchelt, vice president for reproductive rights and health at the law center.

Several other women’s preventive health services could be on the line if the health law is repealed or changed. Some may be easier to get rid of than others, say women’s health policy experts.

Under the law, preventive services that are recommended by the U.S. Preventive Services Task Force have to be covered without cost sharing. The task force, an independent panel of medical experts, evaluates the scientific evidence for screenings, medications and services and publishes several new or updated recommendations annually. Current recommendations that affect women include guidelines for screening for breast and cervical cancer and testing for the BRCA 1 and 2 genetic mutations that increase women’s risk of breast cancer.

“Coverage of those services can’t be changed without a change to the statute” that created the health law, said Dania Palanker, an assistant research professor at Georgetown University’s Center on Health Insurance Reforms. If the law is repealed, then that could happen.

There’s another group of required preventive services for women that could be even easier to eliminate, however. Under the law, women’s preventive services that are endorsed by the Health Resources and Services Administration have to be covered by most insurers without cost sharing as well. In 2011, the Institute of Medicine proposed a list of eight preventive services that should be covered, and HRSA adopted them. Among them was the requirement that most insurers cover all FDA-approved contraceptives without charging women anything out-of-pocket. Also included were requirements to cover well-woman visits at least once a year, screening for gestational diabetes, counseling and screening for sexually transmitted infections, breastfeeding support, counseling and supplies, and screening and counseling for domestic violence.

A committee of women’s health providers led by the American College of Obstetricians and Gynecologists has proposed an update to the current guidelines that is under review by federal officials.

“We expect action will be taken before the end of this administration,” Palanker said.

But the Trump administration may not have the same ideas about which preventive benefits for women should be endorsed. The new secretary of Health and Human Services could opt for different decisions than the Obama administration.

“What they can endorse they can also unendorse,” said Adam Sonfield, a senior policy manager at the Guttmacher Institute, a research and advocacy organization for reproductive health based in Washington, D.C.

Finally, many of the details about what’s required to comply with the law have been in the form of thousands of pages of regulations and guidance. A new administration could write different rules or just not enforce the ones that are on the books, advocates warn.

Take birth control. Some health plans initially interpreted the requirement to cover FDA-approved contraceptives to mean that if they covered birth control pills, for example, they didn’t have to cover other hormonal methods of contraception such as the vaginal ring or patch. Federal officials under Obama have declared that insurers couldn’t pick and choose; they had to cover all 18 FDA-approved methods of birth control.

“A lot of the pieces of the preventive services benefits that clarify and make the coverage real and strong has been through federal officials’ guidance that interprets the health law, and there is fear that could be changed,” Palanker said.

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While ACA Was Never Boon Pharma Hoped For, Industry Now On Tenterhooks Over TrumpCare

It’s unclear what any replacement proposals hold in store for pharmaceutical companies, but it seems like it might be a mixed bag. Meanwhile, some leaders in the industry think their colleagues’ relief at a Trump administration instead of a Clinton administration is premature.


Stat:
Drug Makers Are Getting Ready To Shape Trumpcare


The upcoming fight over repealing and replacing the Affordable Care Act promises to shake up hospitals and insurers, but drug makers also stand to gain — or lose — a lot. On the upside, congressional Republicans have already signaled that they plan to roll back billions of dollars in fees the law imposed on the industry. But drug makers also risk losing millions of new customers who became insured under the health care law. And if President-elect Donald Trump and Congress decide they need to cover the full cost of whatever they propose to replace the law, they might turn to drug companies to pay up. (Scott, 12/2)


Bloomberg:
Trump May Be More ‘Vicious’ On Drug Prices, Pharma CEO Says 


Donald Trump’s victory in the presidential race, often cited as a boon to free-market health care, doesn’t mean drugmakers are free of scrutiny over prices, an industry leader said. U.S. pharmaceutical shares rose after the defeat of Democratic candidate Hillary Clinton, who had vowed to go after companies’ “gouging.” Yet if more pricing scandals emerge like the one that beset Mylan NV’s EpiPen, President-elect Trump could be more “vicious” than Clinton, Allergan Plc Chief Executive Officer Brent Saunders said Thursday. (Hopkins and Tracer, 12/1)


Bloomberg:
Pharma CEOs In Shouting Match Over Prices: ‘It’s Ridiculous’ 


Regeneron Pharmaceuticals Inc. Chief Executive Officer Leonard Schleifer jumped into the drug pricing debate Thursday at a health-care conference, accusing fellow drug company executives he shared a stage with of raising prices to cover up a lack of innovation. … Ian Read, who leads drugmaker giant Pfizer Inc., countered with an oft-cited statistic that drug costs as a percentage of health-care expenses haven’t changed in two decades, regardless of price increases. Schleifer’s response: “You’re not entitled to a fraction of the GDP.” The shouting match was a rare occurrence in an industry that’s been trying to show a united front to defend itself from attacks coming from the outside — politicians, patients and health benefits managers. In the past 18 months, companies like Mylan NV, the maker of allergy shot EpiPen, and Valeant Pharmaceuticals International Inc. have emerged as the faces of the public’s outrage over drug costs. (Hopkins and Bloomfield, 12/1)

In other pharmaceutical news —


Stat:
Mylan CEO Accepts Responsibility For EpiPen Price Hikes


In a rare appearance since the EpiPen controversy flared this summer, Mylan Pharmaceuticals CEO Heather Bresch accepted “full responsibility” Thursday for the price hikes that caused national outrage. … Mylan increased the price of an EpiPen two-pack nearly 550 percent to $608 over the past decade. But, Bresch reiterated remarks she made about the price of EpiPen at a congressional hearing in September, citing a lack of transparency in the pharmaceutical pricing system for the controversy surrounding the product. She justified the price increases by pointing to investments made to improve the device and patient access. (Silverman, 12/1)


This is part of the KHN Morning Briefing, a summary of health policy coverage from major news organizations. Sign up for an email subscription.

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TrumpCare could work. Here's how.

President-elect Donald Trump may well fix America’s broken health care system. And for that, you can thank Trump’s pick to lead the Department of Health and Human Services: Rep. Tom Price (R-Ga.).

Price, an orthopedic surgeon, isn’t perfect. But he has clear ideas about health care reform — and is ready to cure some of the worst illnesses of ObamaCare.

ObamaCare promised near-universal coverage while lowering premiums without jeopardizing existing plans or providers. Remember President Obama’s “If you like your doctor, you can keep your doctor, period. If you like your plan, you can keep your plan, period.”?

In reality, ObamaCare will account for $1.8 trillion in new spending over 10 years. Yet it will cover only 31 million of the 48 million uninsured. That’s partly because more employers have dumped their workers on ObamaCare than originally anticipated — and partly because 8 to 9 million fewer people have enrolled in the exchanges than expected.

The big reason why the exchanges aren’t able to lure customers is that median premiums have skyrocketed 116 percent in the last four years, notes Avik Roy of the Foundation for Research on Equal Opportunity. Rising premiums price out too many young and healthy people, especially if they aren’t sufficiently poor to qualify for big subsidies. This has left the exchange pools with older and sicker patients, which, in turn, leads to more premium increases, which prices out more healthy people, and so on and so forth. Some fear that ObamaCare may have already entered an irreversible death spiral of adverse selection.

Liberals want to prop up ObamaCare by throwing more money at insurance companies (by extending the risk corridor and reinsurance programs beyond their 2016 expiration date) while forcing more people to buy coverage through harsher penalties. This would be both pricey and draconian, while doing nothing to actually bend the spending cost curve, another failed ObamaCare promise.

Price, who authored a 250-page ObamaCare replacement bill called the Empowering Patients First Act, has a better answer. There is much to quibble about in his plan. (For example, his proposal to end defensive medicine by having a federally empowered board prescribe best practices that would provide doctors a safe harbor from lawsuits is an attack on patients’ rights.) But he gets the fundamentals right.

Price understands that the reason 48 million Americans lacked health insurance before ObamaCare even though the country spent 16 percent of its GDP on health care — more than any industrialized country — was a combination of two things: One, half of all Americans received a blank check to consume virtually limitless health care via lavish tax-exempt employer plans. And, two, too many mandates and regulations on providers and insurers prevented them from innovating new and cheaper ways of delivering care. The limitless demand and the limited supply was a recipe for inflation that left coverage out of the reach of working-age Americans who didn’t get employer insurance and didn’t qualify for Medicaid.

The Price plan attacks both those problems.

For starters, Price would deregulate the medical industry, scrapping ObamaCare’s many mandates on insurance companies, save the one concerning pre-existing conditions. (Insurers won’t be allowed to turn away patients, no matter how sick, if they have maintained continuous coverage. And those who haven’t maintained coverage will be required to pay 150 percent of the normal rate for two years.) Price would also stop ordering insurers to cover a lavish set of minimum benefits to qualify to sell their plans on exchanges.

Furthermore, Trump’s new HHS secretary would cap tax deductions for work-based insurance coverage at $8,000 for individuals and $20,000 for families. This is by no means stingy, but over time it would save the government money. This money — plus the money generated when ObamaCare’s subsidies are scrapped — would be used to extend new, universal, age-adjusted tax credits to all Americans: $1,200 for individuals between 18 and 35, and $3,000 for those over 50.

These credits are less generous than the subsidies many lower-income folks receive under ObamaCare, to be sure. But bear in mind that they will be available to everyone, even middle-income Americans, many of whom ObamaCare leaves high and dry. Their bigger virtue, however, is that they eliminate the root cause of health care haves and have-nots in America: the differential tax treatment of employers and individuals.

The Price plan would scrap ObamaCare’s individual mandate. That means no one would be forced to buy coverage against their will. The Republican’s wager is that the availability of “free” tax credits combined with cheap plans will prompt the young and healthy to voluntarily buy coverage, leading to more actuarially sustainable risk pools for insurers. He plans to sweeten the deal even further for young individuals and families through more generous Health Savings Accounts.

These accounts allow people to set aside a lump sum of money tax-free every year to pay for high-deductible plans as well as use toward other out-of-pocket medical expenses. Any leftover funds can be rolled over into subsequent years. Price plans to offer a $1,000 one-time refundable tax credit to encourage more people to set up these accounts and let families stash away more than the current $6,750 limit. And because leftover funds accumulate over the years, patients would get an incentive to limit their own medical consumption, bringing down costs over time without government rationing. Equally importantly, because patients will be paying out of pocket, they’ll be more price conscious, creating incentives for providers to come up with innovative ways to deliver cost-effective medicine. Uber for health care, anyone?

ObamaCare enthusiasts insist that the Price plan will cover fewer people than their beloved law because it would scrap Medicaid expansion and block grant the program to states, which would be free to eliminate or scale back coverage for swaths of people. In addition, Price’s scheme to put sick people who can’t buy coverage in the individual market into high-risk pools paid for by the government is dicey, critics say.

Some of these objections are fair. The Price plan certainly won’t deliver nirvana. But then, neither has ObamaCare. In fact, an imploding ObamaCare will jeopardize the coverage of far more patients than a workable alternative. And Price’s plan relies less on sticks and more on fixing the incentives so people purchase coverage voluntarily and consume it prudently.

Price’s No. 1 job after assuming office will be to make everyone see that and move full speed ahead to repeal ObamaCare and replace it with something resembling his plan. Let’s hope he does.

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¿Sin anticonceptivos y gastando más?, qué le espera a las mujeres con el Trumpcare

Mientras se profundiza la idea de que las mujeres perderían el acceso gratuito a anticonceptivos si la ley de salud se deroga o reemplaza, muchas han comenzado a correr para colocarse un DIU o para almacenar píldoras antes de que el presidente Barack Obama deje la Casa Blanca. Pero el control de la natalidad es sólo la punta del iceberg, dicen los defensores. Hay otros beneficios para la salud de las mujeres que también están en riesgo.

En la parte superior de la lista está la garantía de la cobertura de los servicios de maternidad en el mercado de seguros individual. Antes de la ley de salud, era inusual que los planes en el mercado individual pagaran por los servicios de maternidad. Pero la Ley de Cuidado de Salud Asequible (ACA), requirió que el cuidado fuera incluido como uno de los 10 beneficios esenciales de salud que todos los planes individuales deben cubrir. En el 2009, un año antes de la aprobación de la ley, sólo el 13 por ciento de los planes individuales disponibles para una mujer de 30 años en todas las capitales estatales ofrecían beneficios de maternidad, según un análisis del National Women’s Law Center (NWLC).

Algunos planes ofrecían servicios de maternidad como complemento a través de una cláusula adicional que pagaba una cantidad fija en dólares, a veces sólo unos pocos miles, según el estudio. Pero incluso con este tipo de acuerdo, el costo para la mujer podía ser significativo: el promedio de un pago total para un parto vaginal era de $18.329 en el 2010, según un estudio realizado por el Truven Health Analytics.

Antes de la ley, por lo general, las mujeres también pagaban tarifas más altas por el seguro de salud en el mercado individual. De acuerdo con el análisis del NWLC, el 60 por ciento de los planes individuales más vendidos en el 2009 le cobraban a una mujer de 40 años que no fumaba más que a un hombre de 40 años que fumaba, incluso en planes que no incluían ningún tipo de cobertura por maternidad. Esa inequidad desapareció bajo ACA, que prohibió a las aseguradoras cobrar a las mujeres tasas más altas que a los hombres por los mismos servicios.

“Nuestra preocupación es volver a un mundo donde las compañías de seguros estén escribiendo sus propias reglas, y que se regrese a las mujeres a los malos tiempos de la atención de salud, perdiendo todo el progreso que hemos hecho”, dijo Gretchen Borchelt, vicepresidente de derechos reproductivos y salud en el NWLC.

Muchos otros servicios de salud preventiva para mujeres podrían estar en peligro si la ley de salud es derogada o cambiada. Y algunos podrían ser más fáciles de eliminar que otros, dicen los expertos en políticas de salud para las mujeres.

Bajo la ley, los servicios preventivos recomendados por el Grupo de Trabajo de Servicios Preventivos de los Estados Unidos deben ser cubiertos sin costo compartido. Este grupo, un panel independiente de médicos expertos, evalúa la evidencia científica para exámenes, medicamentos y servicios, publicando anualmente varias recomendaciones nuevas o actualizadas. Las recomendaciones actuales que afectan a las mujeres incluyen directrices para la detección del cáncer de seno y de cuello uterino, así como pruebas para las mutaciones genéticas BRCA 1 y 2 que aumentan el riesgo de cáncer de seno en las mujeres.

“La cobertura de esos servicios no se puede cambiar sin un cambio en el estatuto” que creó la ley de salud, dijo Dania Palanker, profesora asistente de investigación en el Centro de Reformas de Seguro de Salud de la Universidad de Georgetown. Si la ley es derogada, eso podría suceder.

Sin embargo, hay otro grupo de servicios preventivos requeridos para las mujeres que podrían ser aún más fáciles de eliminar. Bajo la ley, los servicios preventivos de las mujeres que son respaldados por la Administración de Recursos y Servicios de Salud (HRSA) también tienen que ser cubiertos por la mayoría de las aseguradoras sin costo compartido. En 2011, el Instituto de Medicina propuso una lista de ocho servicios preventivos que debían cubrirse, y la HRSA los adoptó. Entre ellos, estaba el requisito de que la mayoría de las aseguradoras cubrieran todos los anticonceptivos aprobados por la Administración de Drogas y Alimentos (FDA) sin que las mujeres tuvieran que pagar de su propio bolsillo. También se incluyeron los requisitos para cubrir los chequeos regulares de las mujeres por lo menos una vez al año, la detección de la diabetes gestacional, el asesoramiento y la detección de infecciones de transmisión sexual, el apoyo –con asesoramiento y suministros- de la lactancia materna, y la detección y asesoramiento en contra de la violencia doméstica.

Un comité de proveedores de salud para mujeres dirigido por el Colegio Americano de Obstetras y Ginecólogos ha propuesto una actualización de las directrices vigentes que están siendo revisadas por funcionarios federales.

“Esperamos que se tomen medidas antes del final de esta administración”, dijo Palanker.

Pero la administración de Donald Trump puede no tener las mismas ideas acerca de qué beneficios preventivos deben ser aprobados para las mujeres. El nuevo secretario del Departamento de Salud y Servicios Humanos podría optar por diferentes decisiones a las de la administración de Obama.

“Lo que se puede aprobar también puede desaprobarse”, dijo Adam Sonfield, director de políticas en el Guttmacher Institute, una organización de investigación y defensa de la salud reproductiva con sede en Washington, DC.

Por último, muchos de los detalles sobre lo que se requiere para cumplir con la ley han sido presentados en forma de miles de páginas de reglamentos y guías. Una nueva administración podría escribir diferentes reglas o simplemente no obligar a cumplir las que están en los libros, advierten.

Por ejemplo, el control de la natalidad. Algunos planes de salud inicialmente interpretaron que el requisito de cubrir los anticonceptivos aprobados por la FDA significaba que, si cubrían píldoras anticonceptivas, por ejemplo, no tenían que ofrecer otros métodos hormonales de anticoncepción como el anillo vaginal o el parche. Los funcionarios federales de Obama han declarado que las aseguradoras no podían elegir: tenían que cubrir los 18 métodos de control de la natalidad aprobados por la FDA.

“Muchas de las piezas de los beneficios de servicios preventivos que clarifican y hacen que la cobertura sea real y fuerte ha sido a través de la guía [de los funcionarios federales], y existe el temor de que esto pueda cambiar”, dijo Palanker.

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Beyond Birth Control, Women Could Pay More For Insurance Again Under TrumpCare

As the prospect began to sink in of losing access to free contraceptives if the health law is repealed or replaced, women have reportedly been racing to get IUDs or stockpile birth control  pills before President Barack Obama leaves office. But birth control is just the tip of the iceberg, advocates say. There are a number of other women’s health benefits that are also at risk.

At or near the top of the list is guaranteed coverage of maternity services on the individual insurance market. Before the health law, it was unusual for plans in the individual market to pay for maternity services. But the Affordable Care Act required that care be included as one of the 10 essential health benefits that all individual plans must cover. In 2009, the year before the health law passed, just 13 percent of individual plans that were available to a 30-year-old woman in all the state capitals offered maternity benefits, according to an analysis by the National Women’s Law Center.

Some plans offered maternity services as an add-on through a special rider that paid a fixed dollar amount, sometimes just a few thousand dollars, the study found. But even with a rider, a woman’s financial exposure could be significant: The average total payment for a vaginal birth was $18,329 in 2010, according to a study by Truven Health Analytics.

Women were also generally charged higher rates for health insurance on the individual market before the law. According to the National Women’s Law Center’s analysis, 60 percent of best-selling individual plans in 2009 charged a 40-year-old non-smoking woman more than a 40-year-old man who smoked, even in plans that didn’t include any type of maternity coverage. That inequity disappeared under the health law, which prohibited insurers from charging women higher rates than men for the same services.

“Our concern is going back to a world where insurance companies are writing their own rules again, and returning women to those bad old days in health care and losing all the progress we’ve made,” said Gretchen Borchelt, vice president for reproductive rights and health at the law center.

Several other women’s preventive health services could be on the line if the health law is repealed or changed. Some may be easier to get rid of than others, say women’s health policy experts.

Under the law, preventive services that are recommended by the U.S. Preventive Services Task Force have to be covered without cost sharing. The task force, an independent panel of medical experts, evaluates the scientific evidence for screenings, medications and services and publishes several new or updated recommendations annually. Current recommendations that affect women include guidelines for screening for breast and cervical cancer and testing for the BRCA 1 and 2 genetic mutations that increase women’s risk of breast cancer.

“Coverage of those services can’t be changed without a change to the statute” that created the health law, said Dania Palanker, an assistant research professor at Georgetown University’s Center on Health Insurance Reforms. If the law is repealed, then that could happen.

There’s another group of required preventive services for women that could be even easier to eliminate, however. Under the law, women’s preventive services that are endorsed by the Health Resources and Services Administration have to be covered by most insurers without cost sharing as well. In 2011, the Institute of Medicine proposed a list of eight preventive services that should be covered, and HRSA adopted them. Among them was the requirement that most insurers cover all FDA-approved contraceptives without charging women anything out-of-pocket. Also included were requirements to cover well-woman visits at least once a year, screening for gestational diabetes, counseling and screening for sexually transmitted infections, breastfeeding support, counseling and supplies, and screening and counseling for domestic violence.

A committee of women’s health providers led by the American College of Obstetricians and Gynecologists has proposed an update to the current guidelines that is under review by federal officials.

“We expect action will be taken before the end of this administration,” said Palanker.

But the Trump administration may not have the same ideas about which preventive benefits for women should be endorsed. The new secretary of Health And Human Services could opt for different decisions than the Obama administration.

“What they can endorse they can also unendorse,” said Adam Sonfield, a senior policy manager at the Guttmacher Institute, a research and advocacy organization for reproductive health based in Washington, D.C.

Finally, many of the details about what’s required to comply with the law have been in the form of thousands of pages of regulations and guidance. A new administration could write different rules or just not enforce the ones that are on the books, advocates warn. Take birth control. Some health plans initially interpreted the requirement to cover FDA-approved contraceptives to mean that if they covered birth control pills, for example, they didn’t have to cover other hormonal methods of contraception such as the vaginal ring or patch. Federal officials under Obama have declared that insurers couldn’t pick and choose; they had to cover all 18 FDA-approved methods of birth control.

“A lot of the pieces of the preventive services benefits that clarify and make the coverage real and strong has been through [federal officials’] guidance [that interprets the health law], and there is fear that could be changed,” Palanker said.

Please visit khn.org/columnists to send comments or ideas for future topics for the Insuring Your Health column.

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Moving on to Trumpcare

Joel C. Cantor

Credit: Amanda Brown

Joel Cantor, director of the Rutgers Center for State Health Policy

As talk of “repeal and replace” shifts from campaign slogan to serious policy debate, New Jersey has a great deal at stake. Over 670,000 New Jersey residents gained Medicaid or nongroup private health insurance since the implementation of the main coverage provisions of the Affordable Care Act (ACA) in 2014. Most of these people, nearly a half million, gained coverage through the Medicaid expansion. By the second quarter of this year, about 190,000 state residents were benefiting from premium subsidies offered through the health insurance marketplace, a number that will almost certainly grow during the open enrollment period that ends in January.

According to the latest federal data, over the first two years of ACA implementation, the share of nonelderly adults in New Jersey without coverage dropped nearly 40 percent (from 17.5 percent to 10.8 percent). Over the same period (2013 to 2015), the share of New Jersey’s nonelderly adults with private health insurance, mostly through employers, grew modestly from 72.3 percent to 78.2 percent.

The ACA certainly has flaws, but hundreds of thousands of New Jerseyans now depend on it for their health insurance coverage. Through myriad provisions, the ACA is also shoring up the financing and delivery of healthcare in ways that increase value and improve quality.

What’s Next for the ACA?

With the rhetoric of the blistering campaign in the rearview mirror, President-elect Trump and congressional Republicans are now accountable for the success of health reform. Simply opposing Obamacare will no longer suffice. Predictions in the run-up to the election were almost universally wrong, but current procedural, political, and practical realities will frame the future of health reform, at least in the near term.

Repeal of the ACA in the first 100 days of the new administration is exceedingly unlikely. A super-majority of the U.S. Senate would be required to repeal the law, enabling Democrats to block repeal. Defunding the ACA is possible without a super-majority, but doing so without the ability to change nonbudget-related provisions of the law would trigger utter chaos in insurance markets. Such a move would make public dissatisfaction with Obamacare appear quaint in contrast.

The White House could unilaterally and immediately trigger a similar defunding scenario by simply withdrawing its appeal of House v. Burwell, a court ruling that would block federal funding of some ACA subsidies. The administration could also decide not to enforce selected provisions of the law. But these actions would also deeply undermine insurance markets, imperiling health coverage for millions. Ensuing harm would not be limited to blue states. In fact, people living in solidly Republican counties have disproportionately benefited from ACA coverage subsidies.

If insurance regulations continue to require guaranteed issue but without subsidies or mandates, the nongroup market would simply collapse. Healthy people would drop coverage until the need of it, and insurance carriers would withdraw from the market as they faced unsustainable costs. Not everyone understands the interdependence of guaranteed issue with mandates and subsidies; apparently including the president-elect, who has said that he would keep preexisting condition rules. Guaranteed issue rules also enjoy broad public support.

Another, more likely, path would enable the congressional majority and new administration to keep their repeal-and-replace promise without triggering immediate market failure. Congress could enact a budget resolution that ends marketplace subsidies and the tax penalty for being uninsured, but delay the effective dates of the cuts; for example, to the end of the two-year congressional session. That strategy, using the budget reconciliation process, would create a self-imposed ultimatum for Congress to act to prevent market failure.

Starting the clock to defund Obamacare down the road if Congress does not act to replace the rest of the ACA would be very risky, not just for insurance markets. Perhaps this scenario could lead to a true bipartisan compromise, but history suggests otherwise. By winning the White House and retaining majorities in Congress, Republicans will be held accountable for health reform. There is no incentive for Democrats to help them out by voting for reforms that they have long opposed.

Options to Replace Obamacare

The conundrum that Republicans face would be easier if their policy proposals for replacing Obamacare could resolve flaws in the ACA, but nonpartisan analyses demonstrate that they cannot. Some of the reform ideas advanced by the Trump campaign and congressional Republicans are moot. For instance, health insurance can already be sold across state lines and health savings accounts are already available, although the reach of these ideas could potentially be expanded. Other policy proposals would face significant opposition. For example, changing Medicaid from an entitlement to a capped block grant has historically been opposed even by Republican governors.

Public acceptance of replacement policy ideas is also in doubt. In public opinion polls, majorities, including about half of self-identified Republicans, favor expanding Medicaid and subsidizing private health insurance for those who cannot afford it, two of the major underpinnings of health reform.

It is not entirely clear what opponents of the ACA mean when they refer to “Obamacare.” They seem to be referring to unpopular parts of the law such as the enrollment mandate and high-cost sharing and narrow networks of plans available on the ACA marketplaces. But the ACA has hundreds of other provisions, including closing the Medicare Part D “doughnut hole” and numerous quality improvement and cost-containment initiatives that have taken firm root in our evolving healthcare system. Repealing many of these provisions would be extremely disruptive and unpopular among health system stakeholders. They would also shorten the life of the Medicare trust fund and add to the federal deficit.

Given these circumstances, “repeal and replace” would have to proceed more like precision surgery than the swing of an ax. Still, Republicans face a political imperative to act swiftly. In addition to trying to advance their priorities through the legislative process, they can undermine many ACA provisions by simply changing implementation plans, working through the courts, and issuing executive orders, none of which require congressional action. We are likely to see swift action, for example, widening religious exemptions for employers that object to covering contraception. But changing the health insurance provisions of the law will likely take many months or even years.

Importance of State Action

While we wait for Congress, we are likely to see action at the state level. States can apply for waivers of many federal Medicaid rules, subject only the approval of the Trump administration. Earlier administrations have used this authority to advance their policy agendas. Obama, for example, sought to entice ideologically resistant states to adopt the ACA Medicaid expansion by allowing them to impose “personal responsibility” requirements on enrollees such as cost sharing and behavior changes or to move some enrollees into the private health insurance markets. But Obama drew the line at imposing high levels of cost sharing or work requirements for new Medicaid beneficiaries. The Trump administration is not likely to draw such lines, and red-leaning states that already expanded Medicaid are likely to pursue many such restrictions.

Historically, Medicaid waivers were required to be federally budget-neutral and have a prospect of improving the quality and efficiency of the Medicaid program. But determinations of whether a state proposal meets these standards is an administrative decision, and prior administrations have exercised a good deal of flexibility in review of waiver proposals that advance their policy agendas.

Next year the ACA offers even wider waiver authority. ACA Section 1332 waivers will permit states to reshape not just Medicaid, but many other ACA provisions including the mandate, penalties, and some insurance rules. Section 1332 waivers can only be approved if they are budget-neutral and do not reduce the number of people with comprehensive coverage. But like Medicaid waivers, it will be up to the Trump administration to determine when these criteria are met. Once thought of as an opportunity for states to experiment with ideas like a single payer, it is likely that conservative-leaning states will bring forward ideas that dismantle parts of Obamacare.

Of course, policymakers in New Jersey are not likely to try to turn back the coverage gains of the ACA. The Christie administration expanded Medicaid, publically embracing this decision as recently as August. It also developed, was approved for, and is seeking to renew and enhance, a Medicaid waiver that includes a list of reforms to improve care and efficiency of the program. These positive changes are now at risk.

The outcome of the 2016 election adds great uncertainty to the future of coverage gains and delivery system improvements under the ACA. Much depends on the path that Congress and the Trump administration take. If “repeal and replace” can evolve to “modify and fix,” there is hope for progress.

Joel C. Cantor is the director of the Center for State Health Policy and professor of public policy at Rutgers University. The views expressed in this essay are solely those of the author and are not endorsed by funders of the Center for State Health Policy.

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Trumpcare Is Likely to Be Costlier, Less Efficient, and More Annoying Than Obamacare

Vice President-elect Mike Pence, marking up a House health care bill in 2009.

Donald Trump campaigned on a promise to repeal Obamacare promptly after taking office, but he’s been vague about what, if anything, he might replace the Affordable Care Act with. Fortunately, states under Republican control have already provided a good preview of what a GOP replacement of Obamacare might look like. And if they’re any indication, Trumpcare is likely to be more expensive and more complicated than the current system, while covering fewer people and micromanaging them more.

Trump’s website offers vague notions about creating a more “patient-centered healthcare system” and giving the states more control over its regulation. The latter promise echoes a trend over the past couple of years in Republican-controlled states, which have agreed to expand Medicaid coverage under the Affordable Care Act only if they gained leeway to implement it in accordance with their conservative principles. The Obama administration agreed to many of these changes to give more people access to health care. Those state expansion plans now offer one of the best looks at what Trump and a Republican Congress might have in store for Obamacare.

When the Affordable Care Act became law in 2010, it expanded Medicaid, the government insurance plan for low-income people, to cover people earning up to 138 percent of the poverty line. Most of the more than 20 million people who have gained health insurance since then got their new coverage from Medicaid. The Medicaid expansion has saved some Republican-run states more than $100 million a year, and so Republican governors such as Michigan’s Rick Snyder and Arkansas’ Asa Hutchinson have spoken out in favor of it.

As a result, any Trumpcare proposal is likely to keep the Medicaid expansion, while allowing states to shape it to their own policy objectives, replicating the adaptations that Republican-controlled states have already made. The party of smaller government has made an art of designing expensive, complicated, and intrusively bureaucratic health care programs under the guise of promoting personal responsibility.

Perhaps the best example comes from Indiana, under the leadership of Gov. Mike Pence, now the vice president-elect. Healthy Indiana Plan 2.0 (HIP 2.0) was designed to force low-income people to put some “skin in the game,” by requiring them to contribute their own money to the plan as a way of deterring them from using too many unnecessary health care services. To that end, the program has a bewildering array of at least six different benefit levels and cost-sharing requirements. It’s so complicated Pence himself had trouble explaining it in a speech at the conservative American Enterprise Institute two years ago, where he admitted to confusing people in the audience before referring them to the state website for more information.

At the core of HIP 2.0 is a Personal Wellness and Responsibility (awkwardly mashed into the acronym POWER) account that resembles a health savings account and is one reform idea Trump has endorsed. It provides recipients with a $2,500 health care account, paid for by the state and Medicaid enrollees’ premiums. When the money runs out, a high-deductible insurance plan kicks in. If recipients engage in preventive care, the amount of money they can roll over from one year to the next goes up. The setup is supposed to encourage beneficiaries to limit their health care usage while taking personal responsibility for their health.

So far, though, the incentive program doesn’t seem to be working especially well, mainly because most people in the plan have no idea what it is. A recent evaluation of the program found that at least 60 percent of the people surveyed who had a POWER account had never heard of it, and of those who had, many didn’t understand how it worked. The survey mirrored similar research in Iowa and Michigan, where Republicans had tried to force behavioral changes on Medicaid recipients through complex incentive plans. Research shows that simply giving people insurance in traditional Medicaid will increase the number of people who use preventive care, without the need for incentives.

HIP 2.0 charges premiums of up to 2 percent of a recipient’s monthly household income and imposes co-pays for some services. But those premiums do little to cover the costs of the program. “Premiums are not generating revenue for states,” explains Andrea Callow, a senior policy analyst at the nonprofit advocacy group Families USA. She says that health savings accounts are more expensive to administer than traditional Medicaid, whose overhead costs are quite low. And while there isn’t good public data on the Indiana plan, other states have found that the cost of collecting Medicaid premiums usually far exceeds the revenue taken in from consumers. Callow has calculated that Arkansas would spend more than $15 for every dollar it collected in contributions to Medicaid health savings accounts. The Michigan Medicaid expansion, with features similar to Indiana’s, cost $20 million a year to administer.

The premiums do serve another function: They depress enrollment in Medicaid. That phenomenon has been well documented in other states and now also in Indiana. About a third of people in Indiana who apply for HIP 2.0 and are found eligible ultimately don’t get insured because they fail to pay the first premiums. People who don’t pay premiums while in the program can be dropped and then blocked from reenrolling for six months. About 6 percent of the people who were in the expansion group and above the poverty line were dropped from the program during the first year for lack of payment.

“There’s this assumption that these people are not worthy and therefore we’re going to make arbitrary hoops for them to jump through so we can punish them when they fail to jump through them,” says Leo Cuello, director of health policy at the National Health Law Program, a nonprofit that advocates for the health care rights of low-income people. “We’re lawyers and analysts and we can’t figure [these programs] out.”

The result has been that while many more people in Indiana are getting insurance coverage through the Medicaid expansion than before Obamacare, a smaller percentage of Indiana residents have been covered than in states that expanded Medicaid without trying to micromanage people’s behavior through complex administrative schemes. (Indiana’s uninsured rate is more than 9 percent, compared with 6 percent in Kentucky, which expanded Medicaid under a Democratic governor without any restrictions.) But that could be by design.

Under its new Republican governor, Kentucky has proposed changing its wildly successful Medicaid expansion program to match Indiana’s. In its application to the US Department of Health and Human Services for a waiver from some of the Affordable Care Act requirements for expanding Medicaid, the state indicated it would save $2.2 billion over five years if it adopted the Indiana model. According to the state, most of those savings would come from people dropping out of the program because they couldn’t manage the premiums and complexity—18,000 people in just the first year.

Other states, including Arizona, Ohio, and Pennsylvania, have asked the Obama administration for a laundry list of conservative changes to Medicaid along with those secured by Indiana in exchange for expanding Medicaid under Obamacare. These requests include the types of provisions that were incorporated into the welfare reform law in the 1990s, such as work requirements and lifetime limits on benefits. The Obama administration has rejected most of those requests because the measures were unnecessarily punitive or simply violated the basic purpose of the Medicaid law, which is to give people insurance.

A Trump administration could change all that. In doing so, it could effectively put an end to a big chunk of Obamacare without having to suffer the political consequences of dumping 15 million people off their insurance plan. It’s the health care version of self-deportation: Create enough hurdles to enrollment, and most people will drop out of the insurance program all on their own.



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5 Trumpcare Questions Answered for Small Business Owners

During his campaign, President-elect Donald Trump made promises to repeal the Affordable Care Act (ACA), and has since made it a top priority in his first 100 days of office. It is still unclear whether the ACA will be repealed, replaced or amended, and the uncertainty is leaving small business owners wondering how to move forward with providing health coverage for their employees.

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Here are 5 Trumpcare questions answered.

 

What will happen if the employer mandate is eliminated?

The fate of the employer mandate, which requires employers with 50 or more full-time equivalent employees (FTEs) to offer health insurance to at least 95 percent of that staff and their dependents or pay a fee, will not affect small business owners with fewer than 50 FTEs. However, if the government gets rid of the employer mandate, business owners with 50 or more FTEs will no longer have to offer group insurance and would not be subject to a penalty for not offering it.

 

Will the Cadillac tax be eliminated?

It is likely that the Cadillac tax, a fee imposed on high-cost employer coverage, will never see the light of day. The 40 percent excise tax on health insurance costs that exceed a pre-determined threshold amount is set to go into effect in the year 2020. The possibility of eliminating the Cadillac tax, however, will not affect small business owners.

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Editorial: Imagining Trumpcare










U.S. President-elect Donald Trump promised to repeal and replace Obamacare as a candidate, but his plans as President are less clear.


U.S. President-elect Donald Trump promised to repeal and replace Obamacare as a candidate, but his plans as President are less clear. (Evan Vucci / AP)

President-elect Donald Trump says the top of his agenda will be repealing the Affordable Care Act, better known as Obamacare. His campaign manager even suggested recently that he might call a special session of Congress to do it. He didn’t get into the weeds during the campaign about what he has in mind to replace it with, but he said he believes “every American deserves access to high-quality, affordable health care.” Since his victory, he has indicated that there are some parts of the signature law of his predecessor that he would like to keep — specifically, the provision that allows children to stay on their parents’ insurance policies until they are 26 and one that prevents insurers from rejecting coverage for people with pre-existing conditions. One reform he has specifically mentioned is legislation to allow insurance companies to sell policies across state lines.

So what might such a system look like?

Republicans have been agitating for an interstate health insurance market for years, saying it would increase competition and allow consumers to pick plans without mandated benefits they don’t want or need. Democrats (and many health policy experts) warn that such a reform would lead to a “race to the bottom” in which insurers shop for the most lenient regulators and attract young, healthy people with bare-bones plans that offer little protection. In turn, those left in legacy plans would be older and sicker, leading to spiraling costs.


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But the bigger issue is this: Insurance companies may not even want to do it. Federal law doesn’t actually prohibit interstate sales; it’s up to individual states, and a handful have tried it. But few if any insurance companies have actually taken advantage of the opportunity. The issue is not just regulatory but whether an insurer can provide the networks of hospitals and doctors necessary to actually deliver care. A Marylander might be able to buy a cheap insurance policy from Texas, but it doesn’t help if all the doctors here are out-of-network.

Allowing children to stay on their parents’ policies is not a major issue. Many states passed similar laws before the Affordable Care Act. Since the people in question are young and generally healthy, the costs associated with the provision are minimal.

But that can’t be said of the prohibition against denial of coverage for those with pre-existing conditions. The reason insurance companies followed such policies before Obamacare wasn’t because they were heartless but because the economics are terrible. If you can get insurance after you’ve been diagnosed with an expensive health problem, why pay premiums during the years when you’re healthy? Once an insurer’s risk pool includes only those who require costly treatment and not those who are well, the system collapses.

There are a couple of ways around the problem. You could allow companies to charge much more for those with expensive medical conditions, but in many cases that will amount to the same thing as a prohibition on coverage. If you think the increases in premiums for some policies under Obamacare are large, look out. Or you could find a way to get young and healthy people to buy insurance — for example, by hitting them with a tax penalty if they don’t. Which is what the Affordable Care Act does. Republicans have recently been floating a variation on the theme, which is to create a now-or-never open enrollment period regardless of health status, after which pre-existing condition exclusions could apply. But that’s not very likely to persuade young invincibles to buy insurance while it’s extremely likely to lead to tragic consequences down the line for those who are excluded. There is simply no way to get the goodies of Obamacare without some cost or trade off.

If Trump believes “every American deserves access to high-quality, affordable health care,” he should take a look at what’s already working before throwing out the entire system.

—Baltimore Sun

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What Should Trumpcare Look Like?

Obamacare died on election night and Trumpcare was born. With a majority of his party in the House and Senate, President-elect Trump has a free hand, much like Obama did eight years earlier, to craft the health care roadmap for the nation for decades to come. What will Trump’s health plan look like?

First and foremost, it will repeal the Affordable Care Act (ACA), the 2700-page document which emphasizes regulating insurance companies rather than making health care affordable, and prioritizing access to health care to the uninsured rather than reducing the cost of health care to all. In the process of repealing, the Republican lawmakers will have many difficult decisions to make in regards to regulating insurance companies, providing coverage, and lowering taxes. Should they:

1. Repeal the penalty and mandate to buy insurance?
2. Repeal the 80:20 rule where insurance companies must use 80 percent of the premiums for clinical care and refund extra money to patients?
3. Repeal the health care exchanges which provide coverage to 20 million Americans?
4. Repeal Medicaid expansion and subsidies for low-income Americans in need of health insurance?
5. Allow insurance companies to once again deny health insurance due to preexisting conditions?
6. Repeal the requirement that insurers allow parents to keep children up to age 26 on their policies?
7. Repeal 0.9% Medicare taxes on couples earning greater than $250,000 and on device and pharmaceutical companies?

If some or all of these are repealed, the replacement legislation will be difficult. Trump’s campaign promises of allowing people to buy insurance across state lines and increasing health savings accounts do little to fix the larger system and do not address the biggest criticism of rising health care costs, which most Americans incorrectly attribute to Obamacare.

Repealing and replacing with nothing — in effect, going back to pre-Obamacare days — is not a solution either. According to factcheck.org during 2002 to 2006 under George W. Bush, health care premiums rose at a higher rate (58 percent) compared to the increase under Obama (33 percent) with the ACA in effect.

So here is an approach Trump’s health plan can take. Just as Obamacare focused on reducing the uninsured, Trumpcare needs to focus on reducing the cost of health care as its primary mandate. A continued 3-7 % rise in health care cost each year is unacceptable and unsustainable to American businesses and the public. If this continues, soon our health care system will implode and national growth with be crippled due to the burden of healthcare costs.

But talking about healthcare cost can be confusing. The question arises, “who must bear the cost?” The truth is, one person’s cost is another’s income. The patient’s cost is the insurance company’s income. The insurance company’s cost is the doctor’s income. Medicare’s costs are hospitals’ income. The taxpayer’s cost is Medicare’s income. Ultimately, the new plan must guarantee reducing cost to patients through lowering premiums, drug costs, and co-pays. It must guarantee reducing cost to businesses and to the government. We can reduce the cost of health care without compromising service, as other industrialized nations are able to do while maintaining high quality of care. But that will require fundamental change in how we do the business of health care.

The American public has spoken. People say they are dissatisfied with Obamacare. But creating a plan that will satisfy the many stakeholders in health care will be tough. Just ask Obama.

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