ObamaCare’s impact on health costs.

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?

In 2011, analysts were speculating that Assurant Health might exit the insurance business, the Milwaukee Journal Sentinel reported last week. So the recent news that Assurant’s parent company was looking to “sell or shut down” the insurance carrier by year’s end was not a total surprise. The issue now is whether its demise holds larger lessons about Obamacare’s impact on insurance markets.

One analyst called Assurant, which reported operating losses of nearly $64 million in fiscal 2014 and $84 million in the first quarter of fiscal 2015, a “casualty” of the law. The Affordable Care Act “required health plans to cover a package of basic benefits and required health insurers to spend at least 80 cents of every premium dollar on medical care or quality initiatives,” the Journal-Sentinel reported. Simply put, the law made health insurance more like a regulated utility—with plan designs, benefits, and overhead costs strictly regulated.

Obamacare supporters generally argue that these regulatory changes eliminate the potential for customer confusion or the sale of “substandard” insurance products. But further Journal-Sentinel reporting underscores a complication of that approach:

In its next Obamacare-related decision, the Supreme Court will decide whether employers in states that chose not to establish their own Obamacare exchanges can be forced to pay penalties for not offering insurance the government deems acceptable.

The case is somewhat complicated and based on textual questions and legislative history. But if the court rules that the phrase “established by the state” means what it looks like it means, this will bring a small dose of chaos to up to 37 states that now rely on the federal exchange — the infamous healthcare.gov.

A majority of those who bought insurance from the federal exchanges in those states would no longer be eligible for the subsidies that have made the high price of Obamacare insurance less unpalatable for Americans of modest means. And the employer fines that are currently triggered when employees who aren’t offered qualifying health insurance obtain subsidies to purchase it on the exchange would go away.

Waste: After spending billions on state-run ObamaCare exchanges, the federal government is only now writing clear rules on how that money can be spent, while half of the exchanges head toward bankruptcy.

state-run exchanges were supposed to form the beating heart of ObamaCare. And the Obama administration dumped almost $5 billion in an effort to make it a reality.

The results have been a disaster.

Of the 37 states that received $2.1 billion in grants to establish an exchange, only 17 did so, and they got an additional $2.7 billion from the feds.

Of those 17, two went bankrupt in the first year. One of them, Oregon, had received a $60 million “early innovator grant.” Residents of those states now use the federal Healthcare.gov site.

A memo from Health and Human Services’ Inspector General Daniel Levinson warns that some of the remaining may be violating federal law in an effort to stay afloat.

The Affordable Care Act (ACA) changed the American health care system in myriad ways. The primary objectives of the ACA were to expand insurance coverage while reducing the cost of insurance, and to rein in the increasing cost of health care. Whether these goals are being achieved and at what cost to the budget and to the healthcare stakeholders are important considerations. Five years after passage of the ACA, this report attempts to synthesize many of the studies and cost estimates which have been produced in order to answer these questions.

Key Take-Aways

The number of uninsured individuals has decreased, but not by as much as the Congressional Budget Office (CBO) originally predicted.[1]

· 15 million: fewer uninsured individuals since 2010

· 35 million: individuals still without insurance

· 12 million: more people enrolled in Medicaid since 2010

· 11 million: individuals have insurance through a state or federal exchange

· 7.7 million: individuals receiving subsidies for coverage through an exchange

The cost of expanded insurance coverage is being felt at the individual, state, and federal level.

· $300: average increase in annual deductibles for ESI from 2010-2014

· $5,730: average annual cap on out-of-pocket expenses for plans purchased through the exchange in 2014; $2,719 more than the average for ESI plans

· $43 billion: projected individual mandate penalties over the next 10 years

· $167 billion: mandate penalties paid by employers over the next 10 years

· $42.6 billion: cost of ACA regulations implemented thus far

· $1.2 trillion: federal cost for ACA coverage provisions over the next 10 years

The growth in total health expenditures has also returned to pre-recession rates, demonstrating no bend in the cost curve.[2]

· $3.15 trillion: national health care expenditures in 2014

· 17.9: percent of GDP spent on health care in 2014