Posts Tagged ‘healthcare insurance’

Affordable Care Act Under Siege As It Celebrates Its 1st Birthday

Wednesday, March 30th, 2011

As the Patient Protection and Affordable Care Act (ACA) celebrates its first birthday, the future of the law is still unclear, but its effects have been enormous.  The debate over the law likely created the “tea party” movement.  Last November, Republicans took control of the House of Representatives and strengthened their numbers in the Senate.  Potential contenders for the 2012 Republican presidential nomination need only say one word, “Obamacare,” to get a negative reaction from a crowd.  President Obama at times himself has struggled to ensure that his first term isn’t defined solely by this legislation.

Public opinion over the ACA remains divided, despite the efforts of Democrats to showcase how it will provide healthcare insurance to millions of uninsured Americans.  Additionally, most Americans remain confused about what the healthcare overhaul actually accomplishes.  Republicans considering a 2012 presidential race for the most part stand united in their opposition to the legislation.  Former Minnesota Governor Tim Pawlenty is using his opposition to the law to gain a national following.  “If courts do not do so first, as president, I would support the immediate repeal of Obamacare and replace it with market-based healthcare reforms,” Pawlenty said.  Former Massachusetts Governor Mitt Romney is in a different position because he supported a similar law during his tenure.

Representative Steve King (R-IA), the Iowa Congressman who is in the vanguard to repeal the ACA, says that “America will never become the nation it can be if were saddled with Obamacare“, “I have a deep conviction that this is unconstitutional, that this is unsustainable, and I have a duty.  And that doesn’t mean I sit back and wait for the Supreme Court to save America from itself.  It’s my job to step up and lead.”

Taking a difference stance, Carmela Coyle, president and chief executive of the Maryland Hospital Association, said her group strongly supports the reform law and will work to assure that the effort translates into better and cost-effective care.  “We support healthcare reform because hospitals see every day what happens when patients don’t have the healthcare coverage they need and can’t get their care at the right time and in the right setting.  Expanding coverage was necessary, and it was right.  We must ensure that the health coverage now guaranteed to many Marylanders is meaningful coverage.”

What’s the future of the Affordable Care Act? House Republicans, who say the law gives the federal government too much control and doesn’t cut costs, passed a repeal bill after they became the majority in January.  Full repeal is unlikely unless Republicans successfully take control of the Senate and the presidency in the 2012 presidential elections.  The current Democratic-led Senate will not vote to repeal and President Obama would certainly veto a repeal bill.  Democrats argue the law’s reforms will slow the growth of healthcare costs while improving care and reducing the ranks of the uninsured.  Republican efforts to withhold funds to block the law’s implementation will be DOA in the Senate.  That leaves Republicans the option of picking apart the law regulation by regulation, a strategy that could prove more successful.

In the meantime, implementation is underway.  “As we look forward with implementation of the health reform law, the states really become the focus now,” said Jennifer Tolbert, a principal policy analyst at the Kaiser Family Foundation.  “When thinking about the coverage expansions in particular because it is going to be up to the states to implement the expansion of the Medicaid program for lower-income individuals and to create the new health-insurance exchanges that will provide access to private insurance for moderate and middle income individuals.”

Healthcare Spending Slowed in 2009

Tuesday, January 25th, 2011

Americans’ healthcare spending grew by just four percent in 2009 (the last year for which statistics are available), the smallest annual increase in 50 years. This suggests that Americans did not seek healthcare because of lost jobs and a lack of healthcare insurance due to the recession.  At the same time, healthcare insurance premiums increased at a faster pace than in 2008.  Additionally ,the number of Americans with coverage fell by 6.3 million.  Out-of-pocket spending on healthcare showed a slight increase.  Medicaid spending rose sharply by nine percent, compared with less than five percent in 2008.  This is a result of more people qualifying for Medicaid, again because of the recession.

The statistics, released by the Department of Health and Human Services (HHS), are a sign that the recession left a deep imprint on healthcare in America – far worse than other recent recessions.  “Job losses caused many people to lose employer-sponsored health insurance and, in some cases, to forgo health-care services they could not afford,” according to economists and statisticians at HHS’s Centers for Medicare and Medicaid Services.  The report, which has been compiled by the government annually since 1960, is the most recent snapshot of spending across the healthcare system.

Healthcare spending in the United States totaled $2.5 trillion in 2009, adding up to an average of $8,068 per person.  The four percent rise recorded in 2009 compares with more than six percent in 2007, eight percent in 2005 and double-digit increases in 1990 and 1980.  Even with the slowdown in spending, healthcare spending still comprised 17.6 percent of the GDP in 2009.

Affordable Care Act Passes Its First Court Test

Thursday, October 28th, 2010

Healthcare reform survives its initial court case. Can the government make people buy insurance?  The Affordable Care Act (ACA) has survived its first court test, an attempt in Michigan to overturn the mandatory insurance provision that requires Americans to buy minimum coverage. The ruling by U.S. District Judge George Steeh was in response to a lawsuit filed by the Thomas More Law Center, which had requested an injunction against the ACA on the grounds that it exceeds Congress’ authority and is an unconstitutional tax.

In his 20-page decision, Steeh ruled that Congress has the power to pass the law under the Commerce Clause of the United States Constitution.  According to the decision, “The minimum coverage provision, which addresses economic decisions regarding healthcare services that everyone eventually, and inevitably, will need, is a reasonable means of effectuating Congress’ goal.”

Steeh noted that “Without the minimum coverage provision, there would be an incentive for some individuals to wait to purchase health insurance until they needed care, knowing that insurance would be available at all times.  As a result, the most costly individuals would be in the insurance system and the least costly would be outside it.  In turn, this would aggravate current problems with cost-shifting and lead to even higher premiums.”

The Thomas More Law Center plans to appeal Judge Steeh’s ruling.

Healthcare Reform to Provide Coverage for Millions of Young Adults

Wednesday, October 27th, 2010

12.1 million young Americans will get healthcare coverage in 2014. When the Patient Protection and Affordable Care Act is fully implemented in 2014, approximately 81 percent of young adults aged from 19 to 29 will have healthcare coverage, according to a report from the Commonwealth Fund. In fact, young adults comprise approximately 30 percent of the 32 million Americans who will finally have healthcare coverage in 2014.

The 12.1 million young adults expected to get coverage include 7.2 million who will be covered by a Medicaid expansion, and 4.9 million who will buy subsidized private insurance.  The law does not cover an estimated 1.8 million undocumented young adults, who are not eligible for Medicaid or subsidized insurance.  According to the Commonwealth Fund report, the crucial time to get coverage is when young adults graduate from high school or college.  Approximately 27 percent of young adults who don’t attend college lose their insurance; another 15 percent secure a new source of coverage.  For college graduates who entered the workforce, approximately 32 percent lost their insurance while 43 percent had access to a new source.

Study Finds Some Healthcare Plans Are Unaffordable

Wednesday, June 16th, 2010

Pro-business consultant Mercer L.L.C. predicts some employers will find healthcare reform too costly.  Approximately 38 percent of companies have employees for whom healthcare insurance coverage would be deemed “unaffordable”, according to a study by the New York-based pro-business benefit consultant Mercer L.L.C.  According to the healthcare reform bill that phases in between now and 2014, employers are subject to penalties if premiums paid by their full-time employees are more than 9.5 percent of household income.  The yearly penalty for too-expensive coverage is $3,000 for each full-time employee who takes government assistance to buy coverage in a state insurance exchange.

“Lawmakers did not take into account that employers don’t have access to information on employee household income,” said Tracy Watts, a Mercer partner.  “Employers question how they are going to get that information and what other administrative challenges might come along with this new requirement.  For example, what happens if an employee’s total family income changes during the course of a plan year?”

Another Mercer finding is that 51 percent of employers with more than 500 workers offer coverage to part-time employees who work 30 hours a week or more.  The rest either do not offer coverage to part-timers, or require that they work 30 hours to be eligible.  “This rule will require employers with a lot of part-time employees to make some hard choices,” according to Watts.  “If they don’t offer coverage to part-timers, can they afford to start, or to raise the minimum hours required for coverage?”

“Barely Hanging On”

Tuesday, May 11th, 2010

Study finds that middle-class Americans are losing their healthcare coverage.  Middle-class Americans are losing their healthcare insurance at a faster rate than other income earners. This finding was reported in “Barely Hanging On”, prepared by the University of Minnesota’s State Health Access Data Assistance Center.  The report was commissioned by the Robert Wood Johnson Foundation as part of its yearly Cover the Uninsured Week and analyzed data from the U.S. Census Bureau and the Department of Health and Human Services.

According to the study, three million fewer middle-income Americans had healthcare insurance provided by their employers in 2008 when compared with 2000.  Two-thirds of families earning between $45,000 and $85,000 a year were insured by their employers in 2008, a seven percent drop from 2000.

The study also found that costs had risen 81 percent between 2000 and 2008.  During the same timeframe, household incomes fell 2.5 percent.  Additionally, fewer workers were offered or could afford employer-provided coverage.

“America’s uninsured crisis means that hard-working people with average incomes are being squeezed,” said Risa Lavizzo-Mourey, the Robert Wood Johnson Foundation’s president and CEO.  “The fallout from rising health insurance costs hits everyone.”

White House Asks Insurance Industry for Transparency on Premium Increases

Wednesday, March 17th, 2010

HHS Secretary Kathleen Sebelius wants healthcare insurance companies to be more transparent on premium increases.  The outcome of the high-level meeting?  Greater transparency is needed when companies request increases in healthcare insurance premiums.  Sebelius suggested the executives post proposed rate increases and actuarial data supporting the need for them on the internet.  “At the very least, we need some transparency,” Sebelius told the Associated Press.

Angela Braly, WellPoint president and CEO, said that transparency is “a particularly constructive place to start.”  Although no firm agreement was reached at the meeting in the White House Roosevelt Room, Stephen Hemsley, UnitedHealth Group’s CEO said “I do expect there will be some follow-up from the secretary.”

President Obama spent a few minutes in the meeting, discussing costs and the individual insurance market, which is where the largest hikes are being made.  The president gave the executives a letter from a woman in Ohio whose insurance premium is being raised by 40 percent to demonstrate the hardship the increases place on people.

Clinton-Era Healthcare Reform Warriors Sending in Reinforcements

Monday, February 15th, 2010

Veterans of the Clinton administration's efforts to reshape healthcare are lining up to cover all Americans.Veterans of the Clinton administration’s efforts to reshape healthcare policy are lining up to support President Barack Obama’s plan to extend coverage to all Americans and make medical care more affordable.  Although this group isn’t a believer in making concessions to the opponents of reform, they have an attentive audience because of their hands-on experience and belief that Democrats can’t afford another healthcare failure.

“If Bill Clinton couldn’t get it done, and Barack Obama can’t do it, no Democrat will ever try again,” said Len Nichols, an economist and health policy director at the New America Foundation.  Nichols is currently an unofficial advisor to lawmakers and Obama administration officials hammering out details of the proposed healthcare reform legislation.  Another veteran of the Clinton-era healthcare reform effort, Chris Jennings, says “History is written by the victors, not the vanquished.  Failure would serve as the ultimate judgment as to whether this effort was worth doing.  Jennings, congressional liaison for Hillary Clinton during the 1990s, now works as a lobbyist.

The current healthcare reform legislation is significantly scaled back from the ambitious Clinton plan, though it still faces Republican opposition.  The Obama plan concentrates on people who have the most difficulty obtaining and retaining health insurance – small businesses and those who buy their own coverage.  “We are using the private insurance market and private incentives, as opposed to command-and-control,” Nichols said.  “As a policy matter, we are in the middle.”

Healthcare Reform Needs to Model Itself on Agriculture

Monday, December 28th, 2009

U.S. agricultural strategies applied to healthcare reform legislation could help rein in costs.The current healthcare fight is very much like efforts in the early 20th-century efforts to make food affordable to the common people.  In an important article in The New Yorker, Boston-based surgeon Atul Gawande talks about a time when more than 40 percent of an American family’s income was dedicated to paying for food; farming was a labor-intensive enterprise that employed nearly half the workforce; yet bringing the nation’s bounty to the table was a costly process.  The agricultural crisis – which prevented resources from flowing to other economic sectors – led to the United States Department of Agriculture appointing extension agents to teach modern farming methods to increase food production.  The strategies adopted by these agricultural extension agencies succeeded in lowering food cost to eight percent of income because the government proceeded by trial and error, continually adjusting their policies to respond to results.  Gawande suggests that similar local grass-roots strategies applied to healthcare reform legislation could help rein in costs.

The Senate healthcare reform bill does many good things – establishes insurance exchanges, mandates and tax credits to assure that at least 94 percent of Americans will have coverage.  What the legislation does not address is crucial – it has no mechanism to control spiraling healthcare costs.  Consider that healthcare accounts for 18 percent of every dollar Americans earn.  Between 1999 and 2009, the average yearly premium for employer-sponsored family insurance coverage soared from $5,800 to $13,400.  Medicare beneficiary rose from $5,500 to $11,900.

Gawande notes that “Where we crave sweeping transformation, however, all the current bill offers is those pilot programs, a battery of small-scale experiments.  The strategy seems hopelessly inadequate to solve a problem of this magnitude.  And yet – here’s the interesting thing – history suggests otherwise.”

“Getting our medical communities, town by town, to improve care and control costs isn’t a task that we’ve asked government to take on before,” Gawande writes.  “But we have no choice.  At this point, we can’t afford any illusions:  the situation won’t fix itself, and there’s no piece of legislation that will have all the answers, either.  The task will require dedicated and talented people in government agencies and in communities who recognize that the country’s future depends on their sidestepping the ideological battles, encouraging local change, and following the results.  But if we’re willing to accept an arduous, messy and continuous process we can come to grips with a problem even of this immensity.  We’ve done it before.”

Individual Health Insurance Policies Cost Less in Chicago Suburbs

Tuesday, November 24th, 2009

Study shows wild disparity in pricing between Chicago suburbs and the city.  A study has found that people living in Chicago’s inner-ring suburbs – towns like Oak Park, Evanston, Berwyn and Oak Lawn – have access to individual healthcare insurance quotes that average 14.6 percent less  than people living within city limits. According to data compiled by Norvax, Inc., a technology firm that serves the healthcare insurance industry, people who live 15 to 25 miles from downtown Chicago pay 12 to 15 percent less on their monthly premiums.  Move out another 25 or 40 miles from the city and premium rates are 20 to 30 percent less.

Norvax makes software that lets individuals search the lowest or best-priced private coverage offered by insurance brokers and agents.  Its public exchange, which has more than 80 insurance carriers, operates as Go Health Insurance. The research was based on data culled from running GoHealthInsurance.com quotes for 3,029 zip codes and 963 health insurance plans available in Illinois.  Later, Norvax narrowed the field of research solely to the Chicago area.

The most unexpected result is that residents of Chicago’s southern and western suburbs, many of which are considered to be blue-collar, pay 24.5 percent less for healthcare insurance than their city-dwelling counterparts.  By contrast, suburbanites living north of the city pay 14.6 percent less.

According to Judy Dugan, research director for public policy advocacy group Consumer Watchdog, Norvax’s research proves that today’s individual-coverage insurance market “is the Wild West” because the customized coverage available is not regulated.  “It’s one reason we need healthcare reform – to get rid of this kind of weird disparity in pricing,” she said.