#FullRepeal Daily Digest

The New York Times: Why Improving Access to Health Care Does Not Save Money (Huh!? Where has this dose of reality been hiding for the past 5 years? Conservatives and libertarians have been screaming about it for years – even Politifact somewhat understands it)

• One of the oft-repeated arguments in favor of the Affordable Care Act is that it will reduce people’s need for more intensive care by increasing their access to preventive care. For example, people will use the emergency room less often because they will be able to see primary care physicians. Or, they will not develop as many chronic illnesses because they will be properly screened and treated early on. And they will not require significant and invasive care down the line because they will be better managed ahead of time.
• A study published in March examined how the health care overhaul in Massachusetts affected emergency department use there. Researchers found that increased insurance coverage resulted in more use of the emergency department, regardless of age and issue. Another study published on the Oregon Health Insurance Experiment found that giving people Medicaid also increased their use of the emergency department.
• Researchers in Michigan compared the prevalence of surgery in Massachusetts, New Jersey and New York both before and after Massachusetts went to universal insurance in 2007. They found that expanding coverage was associated with a more than 9 percent increase in discretionary operations and a 4.5 percent increase in nondiscretionary ones. They estimated, based on their results, that the A.C.A. could lead to more than 465,000 additional discretionary surgical procedures within a few years from now.
• Finally, it is a common misconception that prevention always saves money. It is true that there are certain interventions that are cost-saving, such as childhood immunizations and newborn screening. But these are relatively rare. A review of preventive measures in the New England Journal of Medicine found that less than 20 percent of 279 preventive measures saved money. The rest resulted in varying amounts of increased spending.

Forbes: The White House Is Bribing Health Insurance Companies

• The White House recently adopted a new approach for updating Americans on the country’s most consequential law. I call it the “needle in a haystack” method: Bury the announcement in hundreds of pages of regulations and hope no one finds it.
• The White House tried a test run several weeks ago. Hidden in the midst of a 436 page regulatory update, and written in pure bureaucratese, the Department of Health and Human Services asked that insurance companies limit the looming premium increases for 2015 health plans. But don’t worry, HHS hinted: we’ll bail you out on the taxpayer’s dime if you lose money.
• The administration’s intention is clear: Salvage the 2014 midterm elections. Typically, insurance companies release their premium rates between summer and early fall—i.e., right before voters cast their ballots in November. If premiums skyrocket—which looks increasingly likely—then voters won’t look too kindly on Senators and Representatives who voted for Obamacare and created this problem.
  • But the White House may still get away with its attempted sleight of hand. Technically, the regulations don’t force health insurance companies to tamp down their premium spikes. But the White House isn’t asking nicely.
  • Even if they don’t want to play along, it’s still in these companies best interests to assent to the administration’s “request.” Under Obamacare, insurers are so heavily regulated that they have to play nice with the bureaucrats who call the shots. The President isn’t the only government official who carries a big stick. If insurance companies don’t give in, regulators have powerful ways to make life hard for them. A shrewd CEO doesn’t need to look far to see what might happen if his company opts out. This administration already has a reputation for strong-arming dissenting businesses in other industries.

Forbes: What Do We Really Know About Obamacare's Impact On The Number Of Uninsured?

• …If we start from the highest point the uninsured rate ever reached (18.0%), then Obamacare has reduced adult uninsured risk by more than 25%. But if we start at the first quarter of 2010, right before the law was enacted (16.3%), the reduction is more modest. But if we start at the 3rd quarter of 2008 on grounds that the unemployment rate then was nearly identical to today’s rate, then the reduction in the uninsured rate is only 6.9% (i.e., 1 percentage point). This reduction is so small that if these 2 points were the only data we had, the observed reduction would not be statistically significant. How many Democrats would have enthusiastically voted for a bill that spent nearly $1 trillion over a decade yet had only reduced the number of uninsured by less than 7% four years into implementation?
• Let’s imagine the Commonwealth survey figures are right on the money and that we really have achieved a 25% reduction in the number of uninsured and that every bit of this decline can be chalked up to Obamacare. How will we feel in 2017 when the number of uninsured skyrockets by 19% in a single year? That’s the projection recently made by University of Minnesota finance professor Steve Parente using a peer-reviewed microsimulation model funded in part by the U.S. Department of Health and Human Services.
• This may sound totally implausible to Obamacare enthusiasts, but it arises from the way in which various temporary subsidies are phased out and various revenue raising measures are phased in. Leave aside the rate shock that already slapped many Americans unlucky enough to be forced onto the Obamacare Exchanges last winter and that will get repeated in some states during the upcoming open enrollment period. Exchange plan members will see an equally devastating rate shock in 2017.  This, of course, will greatly alter the decisions of millions of Americans who will conclude that the high prices for Obamacare plans (and their attendant narrow networks) simply are not worth it.
• [RELATED] Washington Post: Why we still don't know how many small businesses signed up through Obamacare And why it's probably not very many
  • Responding to an inquiry concerning the latest request from Graves, CMS officials explained that, unlike on the individual exchange, employers are not required to first verify their eligibility with federal regulators before enrolling in a plan on one of the state-based or federal small business exchanges.

The Federalist: Three Conservative Ideas Buried Within Obamacare

• Breaking the tie between employment and health insurance. It is simply not possible to overstate how important this is. The advantages given exclusively to employer-sponsored coverage have badly warped, not just the health care system, but employment and labor policy, as well. It also spawned the creation of Medicare and Medicaid. These programs were enacted in 1965 in part because the elderly and the poor were the two groups of Americans who could not benefit from the health care advantages government gave workers.
  • This might have worked in the post-war era when families were typically made up of a single-wage earner who worked for the same company most of his (usually a “his”) life, and divorce was uncommon. But it makes no sense at all in today’s society where people change jobs frequently, both spouses work, divorce is common, and child-rearing responsibilities are divided.
• Tax credits for individually-purchased health insurance. One of the reasons the individual market has had troubles is because there has been no subsidy for it. Anyone who can possibly get employer-sponsored coverage will do so because paying premiums with after-tax dollars nearly doubles the cost of coverage for most people. So the potential market for individual coverage has been very limited, largely confined to people with loose attachment to the workplace—early retirees, people with several part-time jobs, seasonal workers, independent contractors, and so forth.
  • Now, the way Obama did it is cumbersome, bureaucratic, and unfair. Many millions are receiving subsidies without being qualified for them because the government has no way to verify their status. Many others will be reluctant to improve their earnings because they will lose their subsidies.
• High-deductible health insurance. Obamacare has also broken the ice on the acceptability of higher deductibles. This idea was despised in Progressive circles for decades, but now it is commonplace…Meanwhile, conservatives maintained, high-deductible plans with an HSA would prompt people to pay more attention to their spending, seek out lower cost treatments, and become better informed about their options. This would lead to a healthier population and lower costs over time.
  • In the ten years since HSAs first became law, everything the conservatives predicted has come true. HSAs lower costs and get people more engaged in their own health care decisions. See, for instance, these two write-ups of a RAND study that examined HSAs impact on “vulnerable populations,” here and here. Enrollment is large and growing. The Employee Benefit Research Institute reports that enrollment grew by 16 percent just between 2012 and 2013, and that 78 percent of large and 64 percent of medium-sized employers will offer them by 2016. EBRI also finds that workers in an HSA or other “consumer driven health plan” (CDHP) are much more likely to engage in “cost-conscious behaviors” and participate in wellness programs.

Washington Post (AP): Groups spend heavily lobbying on Medicaid [notably this doesn't seem to include the VA Chamber of Commerce support for Medicaid expansion]

• The Virginia Hospital & Healthcare Association, the leading pro-Medicaid expansion advocate during this year’s legislative session, said it incurred more than $400,000 in lobbying expenses from May 2013 to April 2014. (Americans for Prosperity spent about $470 K)
• The spending is way up for both groups compared to a year earlier. The hospital association reported spending $93,000 and Americans for Prosperity spent $29,000 from 2012 to 2013, according to the Virginia Public Access Project, a nonprofit that tracks money in politics.

Politico Pulse: CERTIFICATE OF (UN)NEED

• Don’t let their name fool you. Certificate-of-need laws don’t help the needy, according to a new paper published today by the Mercatus Center at George Mason University. Thirty-six states and D.C. have CON laws, which are intended to reduce health care costs by limiting unnecessary services but which might actually be increasing the price of medical care by hampering new competition from entering the health care market, the authors write. And there’s no evidence that CON laws improve low-income individuals’ access to health care. The paper: http://bit.ly/1js52Ca