ObamaCare’s impact on health costs.

I might be accused of picking at low-hanging fruit, but I’d nonetheless like to devote another blog post to more IRS regulations that expand and contradict Section 36B. My prior blog posts, which I’ve adapted into an essay upcoming in Bloomberg BNA, discuss regulations that improperly extend ACA premium tax credits to persons in the Medicare coverage gap and to some unlawful aliens. In this post, I want to highlight regulations that improperly penalize employers and that give credits to taxpayers already enrolled in employer-sponsored minimum essential coverage.

Broadly speaking, Section 36B offers premium tax credits, on a month-by-month basis, to taxpayers who purchase Exchange policies only when they can’t otherwise obtain minimum essential coverage. However, the mere offering of minimum essential coverage by an employer to a taxpayer will not disqualify her from tax credits. Instead, the employer coverage must be affordable and provide minimum value. See Sections 36B(c)(2)(C)(i) & (ii).

Federal programs rarely come in under budget. Consider Medicare, which will soon celebrate its 50th anniversary. In 1967, lawmakers projected annual spending in the program would reach $12 billion in 1990. The actual tab that year? A cool $110 billion.

A new report from the Congressional Budget Office says that Obamacare will buck the trend. The CBO has lowered its projections for the cost of the president’s healthcare law by $142 billion over the coming decade, from $1.35 trillion to $1.2 trillion. Obamacare may cost the feds less than anticipated, but it’s extracting far more from consumers’ wallets than they bargained for. Consequently, Obamacare has put insurance out of reach for many Americans – breaking its promise to make health care more affordable.

The decline in Obamacare’s cost is not as impressive as it seems. The total price tag is still some $250 billion higher than the president promised when he signed Obamacare in March 2010. The CBO’s projection came down primarily because the agency decided that the law would be less effective at expanding access to insurance coverage than previously thought. An earlier estimate held that Obamacare would increase the number of insured Americans by 27 million in 2023. The new estimate is 25 million.

One primary goal of the Affordable Care Act (ACA) was to expand access to affordable health care. However, in the five years since the ACA’s passage, we have found that while more people have health insurance, they do not necessarily have access to affordable health care.

In order to pay for the subsidies that have facilitated the expansion of health insurance coverage, many recipients of federal funds were forced to accept payment reductions. Hospitals were faced with cuts of $260 billion over ten years.[1] These reductions came in the form of delayed payment updates for Medicare hospital services and reduced Disproportionate Share Hospital (DSH) payments meant to compensate hospitals for treating a high percentage of patients for whom the hospital is often inadequately reimbursed. The justification for the cuts to hospital payments was based on assumptions that, by increasing insurance coverage to millions of people, fewer individuals would go to the emergency room (ER) to receive care—where they would potentially be treated for free subject to the Emergency Medical Treatment and Labor Act (EMTALA)[2]—and instead could seek care in non-hospital settings such as physician offices, outpatient clinics, urgent care centers, etc.

Nearly a quarter of all people who bought Obamacare health plans still cannot afford the care they need, a leading advocate for President Obama’s healthcare law says.

Families USA, a group that often proposes improvements to the law, says high deductibles make healthcare unaffordable for many people, even though they now have insurance.

A survey released by the group Thursday found that nearly one in four adults shopping in the new insurance marketplaces bought plans with deductibles of $3,000 or more and 42 percent enrolled in plans with at least a $1,500 deductible.

It means many customers are forgoing needed health services because they cannot foot the bill.

“They could not afford tests or they could not afford various treatments or they could not afford the cost of medicines,” said Families USA President Ron Pollack. “The key culprit [is] high deductibles.”

The growth in health care spending has slowed down and President Obama wants America to know his health care law gets the credit. Or maybe the blame, because one reason for that slowdown is that people are spending more out of their own pockets. Health care actuaries say that when people have to spend more out of pocket for health care, they tend to spend less elsewhere. And when a third party—employers, health insurers or the government—insulates consumers from the cost of care they tend to spend more. – See more at: http://www.ncpa.org/sub/dpd/index.php?Article_ID=25652#sthash.KaaCV94L.3b1iR1LZ.dpuf

One of the key questions surrounding Obamacare is just how many people have been newly insured under the law. The answer is clouded by the fact that the White House and others have changed some rules of math for making these assessments.

For example, several years ago, the Obama administration fiddled with the Census Bureau’s definition of what it means to be “uninsured.” The new parameters, which were looser than the old factors, make it hard to construct comparisons between today’s figures for the total number of uninsured and the historical trends.

The Obama team also abruptly started to exclude uninsured illegal immigrants from the national tally on total number of uninsured Americans. Before Obamacare, these individuals were counted in that reporting, inflating the numbers. After Obamacare, these individuals didn’t get insurance, but suddenly didn’t get counted any more.

Now, a new analysis from the highly regarded managed care analyst at Goldman Sachs, Matthew Borsch, and his team, cast uncertainty on some of the recent data releases from the White House, and its network of academicians. In particular, the Goldman breakdown conflicts in some key ways with a recent analysis from RAND that was published in the journal Health Affairs and widely cited by the media.

One of the key questions surrounding Obamacare is just how many people have been newly insured under the law. The answer is clouded by the fact that the White House and others have changed some rules of math for making these assessments.

For example, several years ago, the Obama Administration fiddled with Census Bureau’s definition of what it means to be “uninsured.” The new parameters, which were looser than the old factors, make it hard to construct comparisons between today’s figures for the total number of uninsured and the historical trends.

The Obama team also abruptly started to exclude uninsured illegal immigrants from the national tally on total number of uninsured Americans. Before Obamacare, these individuals were counted in that reporting, inflating the numbers. After Obamacare, these individuals didn’t get insurance, but suddenly didn’t get counted any more.

Now, a new analysis from the highly regarded managed care analyst at Goldman Sachs, Matthew Borsch, and his team, cast uncertainty on some of the recent data releases from the White House, and its network of academicians. In particular, the Goldman breakdown conflicts in some key ways with a recent analysis from RAND that was published in the journal Health Affairs and widely cited by the media.

A report scheduled for release Monday by a conservative-leaning think tank accuses state officials of misleading the federal government and the public about the Massachusetts Health Connector’s readiness to launch its new website in October 2013.

The report from the Pioneer Institute draws on public audit reports and interviews with anonymous people described as “whistle-blowers” to detail what they characterize as a bungled effort by the University of Massachusetts Medical School, software developer CGI, and the Connector to upgrade the Connector’s software in 2012 and 2013.

The Connector — designed to link people with health insurance when they don’t have another source — eventually ended its relationships with UMass and CGI.

Republicans are being ridiculed by the right and the left for weighing ideas that would rescue ObamaCare health insurance policies for people in 37 states if the petitioners prevail in King v Burwell.

“Republicans Are Now Trying To Pass Obamacare Extension To Save Their Own Asses,” writes Allen Clifton in Forward Progressives. “GOP Gets Ready to Save the Day If the Court Strikes Down Obamacare Subsidies,” says Rush Limbaugh.

If the Supreme Court decides against the Obama administration in the case, leaders in Congress are indeed determined to pass legislation to protect coverage for an estimated six million people. ObamaCare has so distorted the market for individually-purchased and small group health insurance that Congress has little choice but to throw them a safety net.

Two years in, there’s a lot we still don’t know about Obamacare. How many people will it end up insuring? What will the premiums look like? How much will the program cost?

Some of these questions won’t be answered satisfactorily for a while, if ever. Even the most basic data point, on how many people have gained coverage, comes from Gallup polls and is a little murky. The percentage of people saying they don’t have health insurance has fallen from about 17 as enrollment kicked off to about 12 now. The easing of the recession has presumably helped that.

Other answers, however, will come into focus in the next year or so. The most important being: What will the market for individual insurance look like once Obamacare is in full effect?