07.24.2014

#FullRepeal Daily Digest

Washington Examiner: When Obamacare loses in court, insurance companies lose, too

Obama's Internal Revenue Service, the D.C. Circuit Court of Appeals ruled, had been illegally transferring money from taxpayers to insurers by pretending the Affordable Care Act said something it didn't say.
…it’s misleading to describe the tax credits as simply subsidies to the insurance customers. They’re really subsidies to the insurance companies. Obamacare tax credits amount to a check from the Treasury to insurance companies. “The ACA's tax credits are given directly to the insurance companies,”...The IRS's website helpfully explains that in many cases, the tax credit is “paid in advance to a taxpayer's insurance company to help cover the cost of premiums.”
- So the taxpayer's tax bill doesn't really go down. He just gets to buy insurance below the sticker price.When government subsidizes the purchase of something, some of the benefit goes to the purchaser, but much of the benefit goes to the seller. Think of how federal student aid has driven college tuitions through the roof, and ethanol subsidies pushed ethanol prices up.
The Halbig ruling is a triple threat to the insurers’ Obamacare favors. By stripping away tax credits, it reduces insurance companies transfers’ from the federal government. Halbig also reduces the impact of the law’s employer mandate and individual mandate.
Obama and the Democrats pushed Obamacare by attacking insurance companies and painting Obamacare opponents as shills for the insurers. This was dishonest populist posturing. The insurance companies were partners in Obamacare — uneasy partners, to be sure…Now, as Obamacare's cracks split open into gaping holes, the insurers may be regretting their partnership.

Politico Pulse: BURWELL: MEDICAL LOSS RATIO SAVES $9 BILLION ON PREMIUMS SINCE 2011 [One quick response to this line of reasoning: recall Obamacare forces insurance companies that spend too much on things that the federal government determines aren't directly related to health care (this is the medical loss ratio), e.g. Customer service features, fraud prevention, administrative expenses, profits etc, to provide rebates to customers. Well it turns out that Obamacare's health insurance tax will add $8 billion in costs to health plans. That is 24 times more than consumers receive in rebate checks ($330 million this year). And even if you buy into the phony premise that the MLR requirement somehow lowers premiums – as HHS claims without much detail – this tax is still about twice as large as how much the MLR has supposedly lowered premiums. And the health insurance tax is only one of Obamacare's mandates/taxes.

Thanks to the health care law’s Medical Loss Ratio rule, also known as the 80/20 rule, consumers nationwide will be refunded $330 million this year. That’s an average of about $80 per family. HHS Secretary Sylvia Mathews Burwell announced today. The MLR and other ACA standards created around $4.1 billion in premium savings [health care economists are face palming on this] in 2013 for a total of $9 billion in savings since the rule was created in 2011, according to an HHS report.

NCPA: Has the Affordable Care Act Slowed the Growth of Health Care Spending?

For years, health care spending has outpaced economic growth. However, in 2012, health care spending as a share of the economy declined slightly for the second year in a row, based on official government statistics released at the outset of 2014. This news was greeted in some quarters as evidence that the Affordable Care Act (ACA) was beginning to bend the cost curve downward.
But do these reports actually indicate that the ACA is curbing health care growth, relative to the growth of the rest of the economy? In fact, the recent slowing of health care expenditures is one of several similar slowdowns. Further, data for 2013 and the first part of 2014 indicate that the trend is already reversing and health care expenditures are rising.
The ACA includes provisions designed to constrain federal health care spending and to expand health insurance coverage. It is unlikely that the provisions intended to constrain Medicare spending will achieve their desired results. However, the ACA expands insurance coverage to the uninsured through subsidized, mandated insurance purchases and by extending Medicaid benefits to individuals under the age of 65 who earn up to 138 percent of the poverty level in states that have chosen to expand coverage. Both of these reforms are expected to increase health care demand and thus spending in coming years.

Associated Press: Medicaid enrollees strain Oregon

The problems come amid nationwide growing pains associated with the unprecedented restructuring of the U.S. health care system, and they show the effects of a widespread physician shortage on a state that has embraced Medicaid expansion.
The flood of new enrollees like McDaniel has hit hardest in rural parts of the state, where the physician shortage is most severe. But problems have been reported from every corner, the AP has learned after contacting each of 15 regional coordinated care organizations, regional networks of doctors and nurses intended to see patients more often for treatment of small and chronic problems.
Five of the 15 regional coordinated care organizations declined to comment. The others reported a list of complications.
- Two regions have stopped accepting new patients, locking out more than 16,000 new enrollees in western and southern Oregon, state data shows. The new patients are still insured, but without a coordinated care network, they're on their own to find a doctor.
- Eight regions saw some practices, clinics and individual doctors close to new Medicaid enrollees.
- In five regions, thousands of enrollees haven't been assigned to a doctor or been in for their first medical appointment.
- Seven regions report that new patients are facing long waits for primary care visits, delays that can last months.
Seven regions report an increase in ER visits, up to 30 percent, in a statistic that has been particularly troubling for supporters of Oregon's efforts.
Officials say the jump in ER use is likely fueled by newly covered patients who are unable to access primary care. "Medicaid expansion has exposed how serious the provider shortage is, that we definitely need more doctors," said David Cole, CFO of the Eugene-based coordinated care organization Trillium, one of the two that's turning away Oregon Health Plan patients. Trillium also has more than 9,000 enrollees for whom it's yet to find a doctor.