Articles on the implementation of ObamaCare.
Along with “stakeholders” (campaign donors), “investments” (government spending) and “obstruction” (Congress), one of our favorite political euphemisms is “improper payments.” That’s how Washington airbrushes away the taxpayer money that flows each year to someone who is not eligible, or to the right beneficiary in the wrong amount, or that disappears to fraud or federal accounting ineptitude. Now thanks to ObamaCare, improper payments are soaring.
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Under the ACA, health insurance marketplaces, also called health exchanges, were set up to facilitate the purchase of health insurance in each state. Customers are free to choose from a set of standardized healthcare plans from participating insurers, and those policies are eligible for federal subsidies.
But insurers have been fleeing the exchanges, arguing that they are loss makers and the types of people attracted to them make the risks too great for the insurers to provide affordable (and profitable) policies.
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Under intense pressure to curb costs that have led to losses on the Affordable Care Act exchanges, insurers are accelerating their move toward plans that offer limited choices of doctors and hospitals.
A new McKinsey & Co. analysis of regulatory filings for 18 states and the District of Columbia found that 75% of the offerings on their exchanges in 2017 will likely be health-maintenance organizations or a similar plan design known as an exclusive provider organization, or EPO. Both typically require consumers to use an often-narrow network of health-care providers—in some cases, just one large hospital system and its affiliated facilities and doctors.
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Senate Majority Leader Mitch McConnell (R-Ky.) says major changes are coming for ObamaCare next year, no matter who wins the White House.
Pointing to rising costs and shaky insurance markets, McConnell said the next president will have to work with Congress to keep the situation from worsening, though he did not specifically say the healthcare law would be repealed.
“It will be revisited by the next president, whoever that is,” McConnell said at an event Monday with the Kentucky Chamber of Commerce. “No matter who wins the election, no matter who’s in control of Congress.”
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The Centers for Medicare and Medicaid Services on Monday issued a proposed rule to govern how Obamacare exchanges will operate in 2018. The proposal would change Obamacare’s risk adjustment program to account for prescription drug data.
Currently, the government determines which plans have sicker enrollees, and thus should receive assistance, based on claims data.
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On Tuesday, Commissioner Julie Mix McPeak, who runs Tennessee’s Department of Commerce and Insurance, announced that her department was approving massive premium increases for insurers providing individual health insurance policies through the Patient Protection and Affordable Care Act exchange in the state.
The percentage increases are stunning and prompted the commissioner to put them in context. Her context was more stunning than the increases themselves.
“I would characterize the exchange market in Tennessee as very near collapse,” McPeak said.
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Enrollment in the insurance exchanges for President Obama’s signature health-care law is at less than half the initial forecast, pushing several major insurance companies to stop offering health plans in certain markets because of significant financial losses.
As a result, the administration’s promise of a menu of health-plan choices has been replaced by a grim, though preliminary, forecast: Next year, more than 1 in 4 counties are at risk of having a single insurer on its exchange, said Cynthia Cox, who studies health reform for the Kaiser Family Foundation.
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In the wake of Aetna’s recent announcement that it was pulling up stakes in 11 of 15 states where it had been selling insurance on Obamacare exchanges, there are more alarming signs that other major insurers are struggling to remain in the game.
On Tuesday, three of the major players in Tennessee — Cigna Health Insurance, Humana and Blue Cross Blue Shield — were granted huge double-digit premium increases for the 2017 season beginning in January amid a warning from the state’s insurance commissioner that the Obamacare markets were “very near collapse.”
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As of January 1, 2014, insurers are no longer able to deny coverage or charge higher premiums based on preexisting conditions (under rules referred to as guaranteed issue and modified community rating, respectively). These aspects of the Affordable Care Act (ACA) – along with tax credits for low and middle income people buying insurance on their own in new health insurance marketplaces – make it easier for people with preexisting conditions to gain insurance coverage. However, if not accompanied by other regulatory measures, these provisions could have unintended consequences for the insurance market. Namely, insurers may try to compete by avoiding sicker enrollees rather than by providing the best value to consumers. In addition, in the early years of market reform insurers faced uncertainty as to how to price coverage as new people (including those previously considered “uninsurable”) gained coverage, potentially leading to premium volatility. This brief explains three provisions of the ACA – risk adjustment, reinsurance, and risk corridors – that were intended to promote insurer competition on the basis of quality and value and promote insurance market stability, particularly in the early years of reform.
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Three years ago, health economists believed Obamacare’s soon-to-launch marketplaces would grow to replace much of America’s fractured, complex employer-based health insurance system.
Predictions for the employer-sponsored insurance system’s collapse ran rampant. The question around companies shifting workers to the new public marketplaces was often framed not as if but when. University of Pennsylvania’s Zeke Emanuel pegged it at 2025. MIT’s Jonathan Gruber estimated 2050.
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