Democrats Introduce Bill to Bring Back Reinsurance in Individual Market

Reinsurance softening continues, price floor elusive

Source: Modern Healthcare

Four Democratic senators have introduced a bill that would make reinsurance a permanent part of the Affordable Care Act’s individual exchanges.

The bill, introduced Wednesday and led by Sens. Tim Kaine of Virginia and Tom Carper of Delaware, would provide federal funding to cover 80% of claims from $50,000 to $500,000, starting next year, with the same level of support through 2020.

Beginning in 2021, the reinsurance program would kick in at $100,000.

In the current law, fees on all insurers that offer commercial plans, not just those in the individual market, paid into the reinsurance program. The funding was $10 billion in 2014, $6 billion in 2015, and $4 billion in 2016, when it ended.

When the reinsurance kicked in varied by the volume of reinsurance claims. In 2014 and 2015, it kicked in at $45,000; in 2015, it started at $90,000.

The fund covered all of the costs between $45,000 and $250,000 in 2014, but only 55.1% in 2015 and 50% in 2016.

According to the American Academy of Actuaries, somewhere between 4 to 7 percentage points of the 22% average increase in 2017 pre-subsidy premiums was due to the end of reinsurance.

The bill would also dedicate $500 million annually for the next three years to help states improve enrollment. Counties where there are fewer insurers would get priority for this funding.

“The only way to get healthcare right in this country is for both parties to work together on real solutions for all Americans,” Kaine said in a statement announcing the bill. “This is just one way to improve affordability and choices for consumers and I look forward to working on additional solutions.”

Both Carper and Kaine noted that Medicare’s drug prescription benefit includes reinsurance as a part of its design.

6 Favorable Changes to HSAs Under GOP Health Bill: HSA Bank Report

Source: ThinkAdvisor

Current legislature sitting in Congress – including the American Health Care Act – indicates favorable changes for health savings accounts (HSAs).

Since the new Congress began in January, there have been more than 20 bills proposed that impact consumer-directed healthcare (CDH), and more specifically HSAs. In May, the House of Representatives narrowly passed the American Health Care Act (AHCA).

A new report from HSA Bank provides insight into specific impacts on HSAs and consumer-directed healthcare (CDH) outlined in the American Health Care Act (AHCA), as well as examines the other proposed legislation.

“Whether they get passed or not, I don’t expect that to have a negative impact on HSAs,” Chad Wilkins, executive vice president and head of HSA Bank, told ThinkAdvisor. “We’ll continue to see that kind of growth going forward. And if they do get passed, we’ll see more wind at the back of high-deductible health plans and HSAs.”

HSAs, which can be as much a retirement savings vehicle as a health care financing plan, have grown in popularity recently.

The number of people enrolled in HSAs continues to grow, although more slowly than in previous years. According to America’s Health Insurance Plan report, 20.2 million U.S. residents were covered through HSA-compatible, individual, small-group or large-group plans in 2016.

Fidelity analysis shows a surge in health savings account in the third quarter of last year.

Wilkins, who co-authored the report with Kevin Robertson, senior vice president and chief revenue officer, attributes the growth in HSAs to both the cost standpoint for employers offering plans, as well as the cost savings for individuals both today and in retirement.

And he predicts this growth and popularity will continue to expand – despite what happens in Congress.

“There’s been a lot of changes in legislators over the past 10 years and HSAs have stayed relatively stable in that world,” Wilkens said.

The report provides insight into the six specific impacts on HSAs and CDH plans outlined in AHCA, as passed by the House, with a focus on how they will positively impact individuals’ ability to own their health.

The top-ranking Democrat on the Senate side of the Joint Economic Committee, though, has said expanding the health savings account program would do little to help ordinary Americans cope with cuts in Affordable Care Act coverage expansion programs.

According to Robertson, these impacts “focus on expanding access to health savings accounts and CDH plans for Americans.”

1. Raises HSA contribution limits to the high deductible health plan (HDHP) out-of-pocket maximum.

The current 2017 HSA contribution limits are $3,400 for a single plan and $6,750 for a family plan. The proposed 2018 contribution limits would increase that to $6,550 for a single plan and $13,100 for a family plan.

2. Repeals the ACA contribution limit on Flexible Spending Accounts (FSAs) (currently $2,600 for 2017)

Approximately 20% of Americans covered by private insurance are able to contribute to an HSA since they are enrolled in a qualified HDHP, according to the report. For those not covered by an HDHP, this change effectively allows for significantly higher contributions to help cover large out-of-pocket expenses.

3. Allows spouses to make catch-up contributions to the same HSA

“The most significant obstacle to maximizing spousal contributions has been the aggravation of having to open a second account,” the report says.

This change will make it easier for seniors to maximize their savings for retirement years, both in terms of lower administration costs, and simplification of the contribution process.

4. Repeals the prescription requirement for over-the-counter medications as qualified medical expense distributions from HSAs, FSAs, and Health Reimbursement Arrangements (HRAs)

The ACA raised the prices for anyone purchasing over-the-counter medications, and with this repeal, it will immediately lower healthcare costs for people using HSAs, FSAs, and HRAs to purchase these products, according to the report.

5. Lowers the penalty for non-qualified HSA distributions made prior to age 65 from 20% to 10%

This penalty exists to ensure that HSAs are used as healthcare savings tools and not tax shelters for assets. The report says that a lower penalty would make HSAs more attractive since “the fear of a 20 percent penalty may have been a detractor in individuals using HSAs as a savings account.”

6. Allows for qualified distributions to reimburse medical expenses incurred within 60 days of HDHP coverage but before HSA account is established

“Even though an individual may be covered by an HSA-qualified health plan, they are not allowed to claim their medical expenses as qualified distributions until they have met the legal requirements of establishing their HSA,” according to the report.

This provision would give individuals a 60-day window to cover these instances.

If Trump Kills Subsidies, Covered California Has A Plan

118472 fullSource: KPCC

The state exchange will now require insurers to create health plans outside of Covered California that would provide the same discounts on out-of-pocket costs that consumers get now with the so-called cost-sharing subsidies. To make up for not receiving the subsidies, insurers would be allowed to charge higher premiums – from 15 to 17 percent higher, according to Covered California Executive Director Peter Lee.

“This is the best-worst option,” he says. “We need something that health plans can rely upon throughout 2018.”

Half a million Californians get the cost-sharing subsidies under the Affordable Care Act. Trump has continually threatened to drop the government’s appeal of a court ruling that invalidated the subsidies. Insurers and regulators say the uncertainty over the subsidies’ future threatens the stability of insurance exchanges such as Covered California.

The insurance industry and consumer advocates expressed support for the plan Thursday, even as they characterized it as less-than-optimal. All agreed with Lee that the state has to take steps to address the uncertain future of health policy.

“Without certainty, some plans might not participate at all in 2018,” says Lee.

Covered California is already in talks with the U.S. Department of Health and Human Services about the fallback plan, since the federal agency will have to sign off on the idea, he says.

The state exchange is in the midst of negotiating insurers’ premiums for next year. It had instructed insurance firms to submit two sets of possible rates, with one based on the assumption that the Trump administration does away with the cost-sharing subsidies.

Last week the exchange said that if the federal government doesn’t clarify its position on the subsidies by mid-August, it will tell insurers to charge higher premiums to account for the uncertainty.

Questions about whether or how Congress will repeal Obamacare have sent shudders throughout the insurance industry, causing firms to pull out of some state insurance exchanges. That has not happened so far in California.

Paying for Single-Payer: Put Up or Move On

Source: Fox & Hound

Since the best feature of the Healthy California Act is that all health care will be free, it seems churlish to suggest that someone must pay for something.

Sadly, even after asserting more than $70 billion in new savings from efficiencies that highly motivated private providers and government regulators have not achieved, and after assuming that federal authorities will hand over about $150 billion in program funding and tax subsidies for use by state health care officials, the academics hired by program proponents find that revenues still fall short by $106 billion.

That’s in year one. Before health care inflation kicks in and utilization of free health care services metastasizes. An analysis of the measure by the author’s own staff found that, “Given all the factors that would make utilization management difficult, a 10% utilization increase is likely a conservative assumption.” That translates into tens of billions annually in higher health care costs.

So how does one resolve an annual $106 billion hole in the state’s health care budget?

But California already is a tax machine. This can’t be that hard.

Actually, it isn’t that hard, if you’re willing to dive deeply into the dumpster of discarded ideas.

Voila! That’s where you’ll find the gross receipts tax, the revenue stream preferred by academics supported by the bill’s union sponsors.

A gross receipts tax is levied against the receipts of a sale by a business of a product or a service. According to the Tax Foundation, “gross receipts taxes are largely a historical novelty to the developed world because it is a singularly unsuitable tax for the modern age.” It is economically inefficient, inequitable, and nontransparent.

The tax is not based on profits, wealth, measures of income, or any other indicator of consumption power that is the signal feature of most taxes in modern developed economies.

The tax gives a competitive advantage to bigger businesses that can make their own inputs rather than buy them. As taxes get added to the various stages of production they “pyramid” into the final price, so that the effective tax rate on goods exceeds the tax rates presented to final consumers. Businesses that must pass through this pyramided rate are less competitive than businesses that can integrate value added processes internally.

For the most part, the gross receipts tax is an artifact of history, trendy about a century ago, but abandoned by much of the world for a very long time.

A handful of states have retained versions of a gross receipts tax at very low rates, mostly far less than one percent of sales.

But even more states are abandoning this archaic tax. Indiana, New Jersey, Kentucky and Michigan all repealed their gross receipts taxes within the past 15 years. Even progressive Oregon voters swamped a gross receipts tax at the polls last year.

It takes a tax that bad to support the single-payer plan in California.

The putative rate for the California gross receipts tax would be 2.3 percent, about the same as the 2.5% tax that lost by 19 points in Oregon last year. (Only one state has a gross receipts tax anywhere near this rate, that’s on radioactive waste by Washington state.)

But wait, there’s more.

According to the academics, even a 2.3% gross receipts tax is not enough to close the funding gap for single-payer. (It “only” raises $92.4 billion.) So sponsors also suggest a new sales tax to top up revenues – not only on goods but on many services. This new tax – also at a 2.3% rate – would raise $14.3 billion, the equivalent of a 58% increase of the existing state sales tax.

Still … this may not work.

Implicitly acknowledging that their multi-layered sales tax mechanism may be a nonstarter, the academics suggest a payroll tax as a fallback revenue source to replace the gross receipts tax. While they believe a gross receipts tax is the superior mechanism because it “does not discriminate in its impact between labor-intensive and capital-intensive firms,” they nonetheless calculate that a payroll tax paid by both employees and employers at a 3.3% rate would raise sufficient taxes to replace the gross receipts tax and fill the revenue need.

Existing payroll taxes for Social Security, Disability Insurance, Unemployment Insurance are capped at certain wage levels. This new payroll tax would not be capped – similar to the payroll tax for Medicare. The Medicare tax is 1.45% of payroll for both employers and employees, so this new payroll tax would be the equivalent of more than doubling the existing Medicare tax – which taxpayers would continue to pay even if Medicare spending is consolidated with the single-payer plan.

To conclude, under the most absurdly favorable circumstances – never-before-achieved cost savings, minimal health care inflation and utilization increases, and enthusiastic cooperation by federal officials – a single-payer plan would require either an untried and economically unsound gross receipts tax, a new sales tax on services, or a record state-level payroll tax.

Yet somehow the single-payer bill is still considered a serious proposal.

Ear To The Door: 5 Things Being Weighed In Secret Health Bill Also Weigh It Down

Medicaid word cloud concept

Source: Kaiser Health News

Anyone following the debate over the “repeal and replace” of the Affordable Care Act knows the 13 Republican senators writing the bill are meeting behind closed doors.

While Senate Majority Leader Mitch McConnell (R-Ky.) continues to push for a vote before the July 4 Senate recess, Washington’s favorite parlor game has become guessing what is, or will be, in the Senate bill.

Spoiler: No one knows what the final Senate bill will look like — not even those writing it.

“It’s an iterative process,” Senate Majority Whip John Cornyn (R-Texas) told Politico, adding that senators in the room are sending options to the Congressional Budget Office to try to figure out in general how much they would cost. Those conversations between senators and the CBO — common for lawmakers working on major, complex pieces of legislation — sometimes prompt members to press through and other times to change course.

Although specifics, to the extent there are any, have largely stayed secret, some of the policies under consideration have slipped out, and pressure points of the debate are fairly clear. Anything can happen, but here’s what we know so far:

1. Medicaid expansion

The Republicans are determined to roll back the expansion of Medicaid under the Affordable Care Act. The question is, how to do it. The ACA called for an expansion of the Medicaid program for those with low incomes to everyone who earns less than 133 percent of poverty (around $16,000 a year for an individual), with the federal government footing much of the bill. The Supreme Court ruled in 2012 that the expansion was optional for states, but 31 have done so, providing new coverage to an estimated 14 million people.

The Republican bill passed by the House on May 4 would phase out the federal funding for those made eligible by the ACA over two years, beginning in 2020. But Republican moderates in the Senate want a much slower end to the additional federal aid. Several have suggested that they could accept a seven-year phaseout.

Keeping the federal expansion money flowing that long, however, would cut into the bill’s budget savings. That matters: In order to protect the Senate’s ability to pass the bill under budget rules that require only a simple majority rather than 60 votes, the bill’s savings must at least match those of the House version. Any extra money spent on Medicaid expansion would have to be cut elsewhere.

2. Medicaid caps

A related issue is whether and at what level to cap federal Medicaid spending. Medicaid covers more than 70 million low-income people. Medicaid covers half of all births and half of the nation’s bill for long-term care, including nursing home stays. Right now, the federal government matches whatever states spend at least 50-50, and provides more matching funds for less wealthy states.

The House bill would, for the first time, cap the amount the federal government provides to states for their Medicaid programs. The CBO estimated that the caps would put more of the financial burden for the program on states, who would respond by a combination of cutting payments to health care providers like doctors and hospitals, eliminating benefits for patients and restricting eligibility.

The Medicaid cap may or may not be included in the Senate bill, depending on whom you ask. However, sources with direct knowledge of the negotiations say the real sticking point is not whether or not to impose a cap — they want to do that. The hurdles: how to be fair to states that get less federal money and how fast the caps should rise.

Again, if the Senate proposal is more generous than the House’s version, it will be harder to meet the bill’s required budget targets.

3. Restrictions on abortion coverage 

The senators are actively considering a measure that would limit funding for abortions, though it is not clear if it would be allowed to remain in the bill under the Senate’s rules. The Senate parliamentarian, who must review the bill after the senators complete it but before it comes to the floor, will decide.

The House-passed bill would ban the use of federal tax credits to purchase private coverage that includes abortion as a benefit. This is a key demand for a large portion of the Republican base. But the Senate version of the bill must abide by strict rules that limit its content to provisions that directly impact the federal budget. In the past, abortion language in budget bills has been ruled out of order.

4. Reading between the lines

A related issue is whether House language to temporarily bar Planned Parenthood from participating in the Medicaid program will be allowed in the Senate.

While the parliamentarian allowed identical language defunding Planned Parenthood to remain in a similar budget bill in 2015, it was not clear at the time that Planned Parenthood would have been the only provider affected by the language. Planned Parenthood backers say they will argue to the parliamentarian that the budget impact of the language is “merely incidental” to the policy aim and therefore should not be allowed in the Senate bill.

5. Insurance market reforms

Senators are also struggling with provisions of the House-passed bill that would allow states to waive certain insurance requirements in the Affordable Care Act, including those laying out “essential” benefits that policies must cover, and those banning insurers from charging sicker people higher premiums. That language, as well as an amendment seeking to ensure more funding to help people with preexisting conditions, was instrumental in gaining enough votes for the bill to pass the House.

Eliminating insurance regulations imposed by the ACA are a top priority for conservatives. “Conservatives would like to clear the books of Obamacare’s most costly regulations and free the states to regulate their markets how they wish,” wrote Sen. Mike Lee (R-Utah), who is one of the 13 senators negotiating the details of the bill, in an op-ed in May.

However, budget experts suggest that none of the insurance market provisions is likely to clear the parliamentarian hurdle as being primarily budget-related.

As GOP Deliberates In Washington, Californians Fear For Their Health Coverage

Image result for California Healthcare photosSource: California Healthline

More than half of Californians fear they or their loved ones will lose health coverage if the Affordable Care Act is repealed and replaced, a new statewide poll shows.

A poll by the Institute of Governmental Studies at the University of California-Berkeley, released Tuesday, unmasks a deep sense of insecurity across the Golden State, especially among low-income residents and people enrolled in Medi-Cal, the state’s version of the federal Medicaid program for low-income people.

The poll found that 56 percent of Californians worry that they or someone in their family will lose health insurance if the federal health care law, also known as Obamacare, is terminated.

The level of concern jumps dramatically among Californians whose household income is less than $20,000 per year and people enrolled in Medi-Cal.

About 4 in 5 people in those categories fret over the potential loss of coverage.

Medi-Cal covers 13.5 million Californians, about one-third of the state’s population, and nearly 4 million of those enrollees joined as a result of the program’s expansion under Obamacare.

“We all have friends or relatives who are or have been on this program,” said Jennifer Kent, director of the state Department of Health Care Services, which administers Medi-Cal.

“The state has literally bent over backwards to make the ACA work,” Kent said. “This poll is basically now showing that people are appreciating what has been built and are worried that it’s going to be taken back down again.”

A GOP bill passed by the House in early May would not only eliminate the major planks of Obamacare but also cap the flow of federal dollars going to Medicaid. The nonpartisan Congressional Budget Office estimated that the proposal would leave 23 million more people uninsured by 2026 than under Obamacare and reduce federal spending on Medicaid by $834 billion over 10 years.

The House sent its measure to the U.S. Senate, whose leaders now are secretly drafting their own version of a health bill and aiming for a vote before July 4.

With the ACA facing a major existential risk, its popularity in California has never been higher. The poll found that roughly two-thirds of state residents support the law.

That represents a record level of public support, said poll director Mark DiCamillo.

“Health care is important. It’s kind of a family issue for a lot of people,” he said. “There’s just a lot of concern about the cuts, or the potential for cuts, and the changes that may be made to the Affordable Care Act. It’s really having an impact in California.”

Pollsters, who conducted the survey on behalf of the California Health Care Foundation, interviewed 1,845 Californians through most of May. (California Healthline is an editorially independent publication of the California Health Care Foundation.)

Medi-Cal was a major focus of the poll, and more than two-thirds of respondents said it is important to them and their families.

Diana Mullis of Sacramento said it would be “scary” if her husband and 4-year-old daughter lost their Medi-Cal coverage.

Her daughter is healthy, and she mostly sees doctors for routine shots and check-ups. But Mullis, 33, knows that Medi-Cal will protect her family from massive medical bills and bankruptcy should her daughter or husband ever land the hospital.

“That’s not going to be the case if things roll back,” said Mullis, who has employer-sponsored insurance.

Lanhee Chen, a fellow at Stanford University’s Hoover Institution, supports the repeal and replacement of the ACA. He believes fearful Californians are being influenced by media coverage.

“Are they getting the full picture of what an effort to repeal and replace Obamacare would look like? I would suggest they’re not getting a full picture,” he said.

He pointed to the majority of Californians who have employer-based coverage and said they wouldn’t be dramatically impacted by an Obamacare repeal.

“The vast majority of Californians, if the ACA goes away, probably won’t see an effect one way or the other,” he said.

And those on Medi-Cal may not lose their coverage, especially if California takes its own steps to keep residents insured, he added.

“California could make the decision to raise taxes,” he said.

But Kent, director of the state’s health care department, counts herself among the worried Californians. She said she has been losing sleep over the future of the ACA and Medi-Cal.

“Any change at the federal level that happens in Medicaid has the potential to have both serious and/or catastrophic effects in the state,” she said.

Senate GOP Prepares for Obamacare Repeal Vote Next Week

Image result for senate GOP photos

Source: Politico

Senate Republicans are preparing to vote on Obamacare repeal next week, according to multiple sources familiar with the negotiations, potentially leaving rank-and-file lawmakers with no more than a week to review legislation that would affect millions of Americans and one-sixth of the U.S. economy.

Senators are expected to see the text of the bill as soon as the end of this week, those sources said, provided this week’s work goes smoothly. The timeline could change based on the response from individual senators toward the proposal at party meetings, but Republicans are increasingly optimistic they can hold a vote next week if this week’s lunch talks go well.

Sen. Bob Corker said Tuesday that he expects legislation to be made public on Thursday and for a vote to take place roughly a week later. The Tennessee Republican told MSNBC’s “Morning Joe” he would have preferred “a more open process” but that he would ultimately vote based on the substance of the measure.

“I believed the majority leader when he said he’s going to take it up. I expect us to vote on it next week,” Sen. Richard Burr (R-N.C.) said Monday. “It’s close. Everybody’s been counting [votes] since the beginning. It’s been close since the beginning.”

Such a timeline would mean Republicans would have about a week to review text of a bill to repeal the 2010 health care law. Burr said he would be comfortable with that timeline: “We’ll debate it for 20 hours.”

Senate Finance Committee Chairman Orrin Hatch (R-Utah) said he hopes Republicans have “as much time as it takes” to study the proposal. Democrats have slammed Republicans for moving so quickly and without holding public hearings.

“It’s not a light bill,” Hatch said. Asked whether they will vote this month, he replied: “We could. But clearly I wonder if we could.”

Senate Minority Leader Chuck Schumer (D-N.Y.) tried on Monday evening to get Majority Leader Mitch McConnell (R-Ky.) to commit to allowing at least 10 hours to review the legislation before it comes to the floor for a vote. McConnell wouldn’t commit to such a number.

“We’ll have ample opportunity to read and amend the bill,” McConnell said.

The timeline could blow up because there is no final deal yet on any of the sticking points and negotiations are still extremely fluid. McConnell can lose just two senators in his 52-member caucus to pass the bill, with Vice President Mike Pence as a tie-breaker.

Democrats have been revving up their opposition to the legislation, organizing hours of speeches on Monday attacking the GOP’s secretive process. Sen. Brian Schatz (D-Hawaii) called it “an affront to democracy itself.”

Democrats spent Monday drawing a contrast between the passage of Obamacare and its potential repeal, emphasizing that hundreds of Republican amendments were considered and Congress devoted weeks to debate in committee and on the floor before the bill, also known as the Affordable Care Act, was passed.

“We had a month of debate in the United States Senate in 2009 — that seems like a reasonable amount of time” for the GOP bill, said Sen. Chris Murphy (D-Conn.).

But Republicans threw the Democrats’ own history on health care back at them, arguing that Democrats deployed secretive techniques and the party-line budget reconciliation process to ultimately pass a portion of Obamacare into law.

“I hope they’ll have more time than we did on Christmas Eve when [former Sen. Harry] Reid produced his bill,” said Sen. Chuck Grassley (R-Iowa).

Republican leaders believe that entering the July 4th recess with their Obamacare quagmire unsolved could lose votes as well as hurt the GOP politically. But the rushed timeline could put rank-and-file Republicans in a tough spot with little time to deliberate such a consequential vote.

“We’re going to need a significant amount of time,” to review text, said Sen. Dan Sullivan (R-Alaska). “More than hours.” His remarks are the latest from rank-and-file GOP senators who have grumbled publicly about the process even as their leadership has vowed to steam ahead.

Last week, Republicans discussed insurance market stabilization in the short term as well as how to overhaul Medicaid and wind down its expansion. One proposal being floated would phase out the law’s Medicaid expansion over three years beginning in 2020 or 2021 and eventually curb the Medicaid growth rate more strictly than the House-passed bill, but that proposal has not yet been agreed on.

This week, Republicans will discuss how far to cut Obamacare’s regulatory regime and how much to beef up the House bill’s tax credits to help people buy insurance. Conservatives want to gut the regulations as much as possible; there is more consensus on the tax credits but not necessarily how to pay for them.

There is no guarantee the legislation will pass given the party divisions. But McConnell has made clear to associates he prefers not to let the bill linger so the Senate can turn to funding the government, raising the debt ceiling and rewriting the tax code, according to people who speak with him regularly.

Senate GOP Moderates Signal Openness to Ending Medicaid Expansion Funding

Image result for medicaid expansion funding photosSource: Modern Healthcare

Moderate Republican senators from Medicaid expansion states are dropping their opposition to ending the Affordable Care Act’s enhanced federal funding for expansion as they embrace the idea of winding down that funding over several years.

Sens. Dean Heller (R-Nev.), Shelley Moore Capito (R-W.V.), and Rob Portman (R-Ohio) all previously said they wanted to preserve expansion funding, and all indicated this week that they could go along with killing the extra funding if the cutoff was delayed. The three reportedly are pushing to start phasing out expansion funding in 2027, seven years later than the House’s proposed 2020 start date in the American Health Care Act.

Their new stance signals a potential breakthrough for Senate Majority Leader Mitch McConnell (R-Ky.) to corral enough GOP votes to pass an ACA repeal and replace bill, just days after Senate GOP leaders worried they wouldn’t be able to meet the vote threshold. Under the budget reconciliation rules, McConnell needs only a simple majority to pass the bill. (Vice President Mike Pence would cast the 51st vote.)

But extending the ACA’s expansion funding could create major budget headaches for Senate GOP leaders when the Congressional Budget Office scores its financial impact. The Senate reconciliation rules require the bill to produce the same $119 billion in 10-year deficit reduction as the House bill.

Ending the enhanced Medicaid expansion funding likely accounts for at least half of the projected $834 billion in reduced Medicaid spending created by the House bill, according to Matt Fiedler, a budget expert at the Brookings Institution’s Center for Health Policy.

If the Senate bill delays the phaseout and if states keep their expansions even temporarily, that could cost tens of billions of dollars, he added.

Senate leaders have signaled they may have to delay repeal of at least some ACA taxes to pay for the extended Medicaid sweetener. That could cost them support from Senate conservatives such as Ted Cruz of Texas and Mike Lee of Utah, who want to immediately end all ACA taxes.

Delaying the end of Medicaid expansion funding won’t necessarily win the Senate moderates political points back home. Hospital leaders and patient advocacy groups said that merely delaying the phase-out would do little to mitigate the damage. They also warn that states will likely terminate Medicaid expansions to low-income adults because they cannot afford to come up with state funding to replace the billions in federal dollars.

“A delayed phaseout of the enhanced (federal contribution) is marginally less harmful than what is currently included in the AHCA,” said Greg Vigdor, CEO of the Arizona Hospital and Healthcare Association, whose state expanded Medicaid. “However, phasing it out whether in 2020 or 2027 will create big problems for Arizona’s patients, healthcare system and local economies.”

At a private meeting of Senate Republicans Tuesday, McConnell reportedly proposed delaying the cutoff of enhanced Medicaid expansion funding for just three years.

There also is discussion among GOP senators about gradually reducing the federal contribution for expansion from 90% to each state’s standard matching rate, which averages 57%.

“My hope is that a longer glide path with flexibility will give the states and the governors the ability to extend the coverage to the population,” Capito told reporters Wednesday, cautioning that she still has to see if “the glide path is too steep.”

Capito’s spokeswoman said the senator “remains focused on affordability and giving states flexibility to operate their Medicaid programs.”

Other Senate GOP centrists from expansion states, including Bill Cassidy of Louisiana, Cory Gardner of Colorado and Jeff Flake of Arizona, also indicated they were moving toward supporting the repeal-and-replace effort despite their objections to the House bill. Sen. Susan Collins (R-Maine), who has backed Medicaid expansion in her state, also spoke favorably of the emerging Senate bill, which is being written behind closed doors with no hearings planned.

Senate Democrats blasted the Medicaid changes in the evolving Senate GOP bill as cosmetic. “No matter how they want to put lipstick on a pig, it is going to be a plan that devastates healthcare for millions of Americans,” Sen. Patty Murray of Washington told the Washington Post.

Some analysts were not surprised that Capito and others now seem to be coming around, as GOP centrists are facing fierce pressure from party leaders to support repealing the ACA, a key Republican promise for the last seven years.

“It’s just a matter of dollars, and dollars can be worked out even if no one likes the final arrangement,” said Tom Miller, a conservative health policy expert at the American Enterprise Institute. The moderates “don’t want to be the ones in the way of this bill. They’ll have to deal with the political consequences of passing nothing.”

All this has put healthcare industry groups that favor making the Medicaid expansion permanent in the uncomfortable position of offering suggestions to Senate Republicans on how to reduce the harm from rolling it back.

Steven Summer, CEO of the Colorado Hospital Association, said he and Colorado hospital CEOs have met with Sen. Gardner and emphasized the value of having more than 400,000 people covered under the Medicaid expansion, which has reduced uncompensated care by more than half and significantly reduced wasteful emergency room visits.

He said Gardner, as a former state lawmaker, knows that his state requires a voter referendum to raise taxes and therefore is unlikely to come up with state funds to replace the enhanced federal expansion funding. That means the state’s Medicaid expansion almost surely would end if the GOP bill cuts off those federal dollars.

The hospital leaders have suggested various alternatives to Gardner, such as modestly phasing down the federal match from 90% to 85% or even 75%. “Our preference would be to keep the Medicaid expansion and the current 90% match,” Summer said. “But we want to give him some ideas for constructive discussion.”

Conservative analysts say the GOP moderates’ shift on Medicaid expansion bodes favorably for the repeal-and-replace effort, but the outcome in the Senate remains uncertain. The moderates are still skittish about ending their states’ Medicaid expansions, and will watch to see what other moderates do so they aren’t in the position of being the senator who blocked the repeal of Obamacare, the American Enterprise Institute’s Miller said.

“Expansion state senators will dig in their heels if they know they aren’t the ones stopping it,” he said. “But if the leaders can pick off one senator at a time, then it’s harder for them to hold out. It’s not absolutely a done deal.”

Nearly 2M Fell Off Obamacare Coverage Rolls Through Mid-March

Image result for obamacare rolls photos

Source: Politico

The number of Americans insured under Obamacare fell by nearly 2 million people between Jan. 31 and mid-March, according to new CMS data that found about 10.3 million still were covered through health law exchanges.

The decline reflects customers failing to pay premiums after they selected plans during the most recent open enrollment period. Roughly 12.2 million people had selected private plans through the federal exchanges and the state-run marketplaces that operate in about a dozen states as of the Jan. 31 deadline to sign up.

CMS said high costs and lack of affordability were the most common factors individuals cited when asked why they didn’t keep their coverage. A separate report on enrollment trends attributed the drop-off to other factors, including securing a job with employer-sponsored insurance.

The 10.3 million covered individuals include those who selected a plan that began in January or February and had paid their first month’s premium.

Enrollment attrition also occurred during the Obama administration, though reporting periods varied. Roughly 11.1 million people were enrolled in Obamacare plans at the end of March 2016, down from the 12.7 million people who signed up during the previous enrollment period.

The new report comes amid continued troubling news about health law insurance markets, including Anthem’s decision this month to pull out of Ohio’s Obamacare marketplace, potentially leaving 10,500 customers in 18 counties without any insurance options for 2018. Republicans in Congress have cited coverage gaps and other problems as justification for repealing the health law.

Sign-ups for Obamacare coverage declined for the first time in the 2017 season and fell below the Obama administration’s estimates for the three-month enrollment window that ended in January, according to federal data.

The Trump administration scrapped phone calls and other forms of outreach to encourage sign-ups in the finals days of the enrollment period, then reversed itself after the move sparked outcry from the law’s supporters and health insurers. Officials said they were unable to pull back some radio and TV advertising that had been purchased by the Obama administration. HHS was able to cancel about $4 million to $5 million in ads.

Why Doctors’ Offices Could Become Obsolete

Image result for self driving car photosSource: San Francisco Chronicle

A man showing early signs of a heart attack — detected by a bot tracking his heart activity from a sensor on his wrist — is picked up by a self-driving car that checks his vital signs on the way to the hospital. There, his doctors video-conference with a specialist, who assesses his symptoms through a Skype-like screen and recommends a treatment plan.

The scenario, inconceivable a generation ago, is closer than you might think. Technological advancements are ushering in a new era of health care, eroding the long-held model of hospitals and doctors’ offices as the physical center of the health system. The change is unfolding on many fronts, and experts say we are on the cusp of a revolution that could come within the next decade.

The growth of telemedicine (video chats with your doctor) and tools to track chronic diseases (wearable glucose-monitoring devices for diabetics) is inching us toward a time when medical care and diagnoses can be accessed from afar, and often without having to see a physician in person.

The explosion of relatively inexpensive direct-to-consumer genetic tests is allowing millions of people to learn potentially life-changing medical information about themselves without ever stepping foot in a doctor’s office.

And cutting-edge research in gene therapy is opening the door to the possibility of people with genetic diseases being treated much earlier in life, and being “cured” for longer periods of time — potentially improving the quality of life for millions.

This rapidly changing landscape raises the question: Will there come a day when we won’t need to go to the doctor’s office anymore? Will we be able to navigate the health system without coming into contact with a medical professional? And would that be good or bad?

Developers of self-driving cars are already considering including some basic inward-facing sensors that can be used for medical applications — such as those that can measure temperature or cameras that can visually assess the health of a passenger — to aid the elderly and people with disabilities, according to Nidhi Kalra, senior information scientist at the think tank Rand Corp. who researches autonomous car policy.

Some people “may have health complaints or challenges that the car needs to be aware of as it’s taking them to the mall,” she said.

Kaiser Permanente, one of the largest health systems in Northern California, recently set up a futuristic mock exam room where patients can sit in front of a computer screen to talk to a doctor remotely while using a stethoscope, digital thermometer and otoscope to check their own symptoms under the guidance of the physician. Kaiser CEO Bernard Tyson has personally participated in the experiment.

“That is the future — being able to provide a great health care service without someone having to get up and go all the way across town for that kind of medical visit,” Tyson said. “All these things represent the moving away from the hospital being the centerpiece of health care.”

Last year, 70 million interactions between Kaiser patients and their primary care doctor were done by secure email, video conference and other remote tools.

Worldwide revenue for telehealth devices and services is expected to hit $4.5 billion next year, compared to $441 million in 2013, according to the business analytics firm IHS Technology. During the same period, the number of people using telehealth services each year is projected to grow from 350,000 to 7 million.

“I don’t think we’ll get to a point where we’ll never see a doctor, but a large percentage (of doctors) will be seeing patients remotely” in the future, said Dr. David Tong, director of the telestroke program at California Pacific Medical Center in San Francisco. His program connects his vascular neurology practice with 20 other hospitals from the Oregon border to Visalia, so hospital physicians can seek his help in treating a stroke patient. Tong does a visual assessment of the patients using technology similar to Skype.

Tong has led the program since its inception a decade ago, when just two hospitals were in the telestroke network, and the concept of talking to a doctor through a screen seemed foreign to many patients. Today, it’s commonplace — “People think, ‘If I do this all the time with my friends, I’ll do it with my doctors too. What’s the difference?’” Tong said.

Despite the promise of remote medical care, though, many traditional barriers to health care remain. Wealth, geography and access to insurance are privileges that no app or technological advancement can replace.

“The major stumbling block right now is financial,” said Tong. “Right now, most insurance doesn’t pay for telemedicine in a very efficient way. That blocks some people from doing it.”

Medicare and Medi-Cal, for example, limit their reimbursement for telemedicine services to psychiatry and to patients who live in rural areas, Tong said.

There may also be drawbacks to receiving care remotely, which reduces the need for physical interaction. Studies have shown that human touch reduces stress, helps premature babies grow faster and improves the lives of nursing home residents.

But in another promising development, medicine is also moving in the direction of preventing diseases before they even cause any symptoms. Efforts by genetic testing firms to screen large populations — coupled with research in gene therapy and gene editing — will give people more information than ever before on their genetic makeup.

As soon as five years from now, “everyone who wants to be sequenced will have been sequenced,” said Dr. Jill Hagenkord, chief medical officer at Color Genomics, a Burlingame company that sells a $249 test that analyzes 30 genes associated with common hereditary cancers including breast, ovarian and pancreatic cancer. People can buy the test directly from Color or on Amazon, but they must submit their health information and have a physician review it and order the test before Color will analyze the sample.

“Whether that’s newborn screening in the hospital system or in a research setting … sequencing data will just exist,” Hagenkord said.

Color is already taking steps toward population screening, working with 40 large self-insured employers including Visa and Salesforce — which collectively cover tens of thousands of people — that subsidize or pay for the test for employees and spouses.

Using gene testing as a preventive tool “doesn’t take the medical professional out of the equation, but maybe you’ll just have a conversation earlier with your doctor,” about getting a colonoscopy sooner or making choices that may reduce your risk of certain cancers, Hagenkord said.

Meanwhile, researchers are working to bring gene therapy from the clinical trial stage to the real world to treat retinal disease and hemophilia — though treatments are not yet available commercially, said Dr. Chris Haskell, who leads Bayer Corp.’s West Coast Innovation Center. Bayer has a joint venture with CRISPR Therapeutics — which uses the gene-editing tool known as CRISPR — to develop and market therapeutics for blood disorders, blindness and congenital heart disease.

“With gene therapies, the industry is moving ahead very rapidly in clinical development toward bringing these to patients very soon,” Haskell said. “Gene editing is still a number of years away behind gene therapy, but has promise for being able to treat many more diseases.”

Gene editing is considered a subset of gene therapy. Gene therapy consists of adding a “missing” part of a person’s DNA, typically through an injection of an engineered virus that carries the replacement gene. With the blood-clotting disorder hemophilia A, patients are missing a blood-clotting protein called factor VIII. This protein is injected and, over the course of the next several days or weeks, the cells start producing the clotting factor and allow the circulatory system to clot normally.

“The trailblazing is happening with hemophilia because we understand the disease,” Haskell said. “But there’s a huge promise for bringing therapies to patients around the world, especially kids with metabolic disorders who have no good therapy.”

Gene editing makes it possible to modify the genetic code — and the applications seem limitless.

“This opens up a whole new realm of ways to treat diseases in that we can turn things on and off, take things out,” Haskell said. “With gene therapy, we have the hammer. Now we have the whole toolbox. However, we’re still learning how to use all these tools.”

And the workshop for those tools? It will be anywhere but your old, familiar doctor’s office.

Last Updated 6/4/2017

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