Obamacare News of the Day

CNBC: One by one, states shutter health insurance exchanges

• Massachusetts' crippled Obamacare exchange is just the latest to throw in the towel and scrap its existing software, but health-care experts said it likely won't be the last.
• Those same observers Tuesday told CNBC that almost half of the existing state-run Obamacare marketplaces could, in the coming years, end up turning enrollment operations in private insurance plans over fully to the federally run HealthCare.gov for a variety of reasons.
• "Certainly, I think you will see even more states default to the federal exchange, certainly up to a half-dozen states," said Bryce Williams [Towers Watson].

NPR: Employers Eye Moving Sickest Workers to Insurance Exchanges

• Can corporations shift workers with high medical costs from the company health plan into online insurance exchanges created by the Affordable Care Act? Some employers are considering it, say benefits consultants.
• "It's all over the marketplace," said Todd Yates, a managing partner at Hill, Chesson & Woody, a North Carolina benefits consulting firm. "Employers are inquiring about it, and brokers and consultants are advocating for it." "Such an employer-dumping strategy can promote the interests of both employers and employees by shifting health care expenses on to the public at large," wrote two University of Minnesota law professors in a 2011 paper that basically predicted the present interest.
• Here's how it might work. The employer shrinks the hospital and doctor network to make the company plan unattractive to those with chronic illness. Or, the employer raises copayments for drugs needed by the chronically ill, also rendering the plan unattractive and perhaps nudging high-cost workers to look at other options. At the same time, the employer offers to buy the targeted worker a high-benefit plan in the marketplaces. A so-called platinum plan could cost $6,000 or more a year for an individual. But that's still far less than the $300,000 a year that, say, a hemophilia patient might cost the company.
• The employer might also give the worker a raise to buy the policy directly. The employer saves money. The employee gets better coverage. And the health law's marketplace plan —required to accept all applicants at a fixed price during open enrollment periods — takes on the cost.

NCPA: Only 25 Percent of Eligible, Unsubsidized, Applicants Selected a Policy

• Of 13.5 million eligible enrollees, 8 million (59 percent) “selected” policies on ObamaCare exchanges; Of 4.8 million eligible enrollees who will not get subsidies, 1.2 million (25 percent) “selected” policies; and of 8.7 million eligible enrollees who will get subsidies, 6.8 million (77 percent) “selected” policies.
• Although the report gives excruciating details of age, gender, and ethnic identities of the applicants, the Administration still declines to report how many of those who “selected” policies have paid premiums, claiming that only insurers themselves have this information.

Modern Healthcare: 26% of exchange customers were uninsured; 87% paying premiums, McKinsey finds

• …younger enrollees were less likely to follow through with premium payments, with 78% of 18- to 29-year-old respondents reporting that they had paid their first bill. Of those individuals surveyed who previously had coverage, 90% report enrolling in a plan for 2014. By contrast, only 13% of survey respondents who were previously uninsured reported signing up for coverage.
• Cost remained the biggest factor in keeping individuals from enrolling in a plan. Roughly 60% of respondents who shopped for coverage but didn't enroll in a plan cited affordability as the reason for not completing the transaction. Of those respondents, 88% were eligible for subsidies.

National Journal: 'Conga Line Of Problems' Awaits Burwell at HHS A former HHS secretary says Burwell would have to put out fires she can't anticipate – on top of handling Obamacare.

• And if she is confirmed, she'll then have to actually take over a sprawling, poorly managed department responsible for the president's top domestic priority—not to mention the country's most expensive entitlement programs, its food and drug regulations, and its most important medical research.
• Obamacare implementation would certainly be Burwell's biggest responsibility, and there's still a lot that needs to be done. Burwell would face an immediate political challenge as insurers begin to file their premiums for plans sold through the health care law's exchanges, and she also would have to navigate unfinished policy and technological work.

Modern Healthcare: Reform Update: Insurer's retreat from ACO investment raises questions about Medicare's program

• Brief ACO refresher:
  • ACOs provide financial incentives to organizations that, by encouraging providers to work under a common organizational umbrella, can reduce costs and improve outcomes. In reality, given the complexity of the existing system, such a strategy will not only fail—it will most likely exacerbate the very problems it was designed to fix. ACOs will concentrate more and more power in fewer and fewer organizations—allowing them to become too large to fail. Such a system will undermine competition and entrepreneurship, the bedrock of innovation and job growth in this country...
  • ACOs, as described, are a strange hybrid of fee-for-service and managed care, subject to ongoing control by CMS [Centers for Medicare and Medicaid Services]. Like other hybrids, they are not likely to breed naturally. ACOs are a keystone of the PPACA [Patient Protection and Affordable Care Act], but they are unlikely to improve health care and reduce its costs.
• Universal American, a publicly traded insurance company that has invested heavily to become the largest operator of Medicare accountable care organizations, will no longer finance existing ACOs where its executives see little hope of financial return. The decision raises questions about Medicare's ability to expand the program as the agency continues to seek new participants and hold on to those already experimenting with accountable care.
• “Where we're seeing it's not working, we're going to stop investing,” said Robert Waegelein, chief financial officer for Universal American, which contracts with local physicians across 13 states to operate 34 ACOs in the Medicare Shared Savings Program. That's about one out of 10 ACOs launched under the program since 2012. “We just want to stop the bleeding,” he said.
• Medicare accountable care results are limited to 113 ACOs in the Shared Savings Program that began in 2012 and another 32 more experimental ACOs that launched that year under the CMS Innovation Center. Financial performance has been mixed so far, and of the 32 Innovation Center ACOs, known as Pioneers, two dropped out and seven switched to the less-risky Shared Savings Program.