A new Avalere analysis finds that more than 2 million exchange enrollees eligible for cost-sharing reductions (CSRs) are not receiving the subsidies because they have selected a non-qualifying plan. In addition to the more publicized tax credits that lower consumers’ monthly premiums, exchange enrollees with incomes between 100 and 250 percent ($11,770 – $29,425) of the federal poverty level are eligible for CSRs. Exchange consumers must enroll in a plan on the silver metal level to access CSRs.
Two leading Republican presidential candidates, Scott Walker and Marco Rubio, recently released concept papers that promise to provide “all Americans” with government-subsidized access to health insurance. This is a monumental development for both the campaign and for the conservative movement, one that breathes Ronald Reagan’s soul into the Republican nomination fight.
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.
The Centers for Disease Control and Prevention (CDC) has released early estimates of health insurance and access to health care for January through September 2014. The National Health Insurance Survey (NHIS) is (in my opinion) the most effective survey of health insurance, because it asks people three different but important questions: Are they uninsured at the time of the survey? Have they been uninsured for at least part of the year? Have they been uninsured for more than a year?
As shown in Figure 2, the proportion of long-term uninsured is about the same as it was circa 2000. The proportion of short-term uninsured has shrink a little in Obamacare’s first year.
New analysis from Avalere finds that while exchanges have succeeded in enrolling very low-income individuals, they continue to struggle to attract middle and higher income enrollees.
Specifically, as of the close of the 2015 open enrollment period, exchanges using HealthCare.gov had enrolled 76 percent of eligible individuals with incomes between 100 and 150 percent of the federal poverty level (FPL) or $11,770 to $17,655. However, participation rates declined dramatically as incomes increase and subsidies decrease. For instance, only 16 percent of those earning 301 to 400 percent FPL picked coverage through an exchange, even though they may be eligible for premium subsidies.
“People receiving more generous subsidies are expected to enroll in the exchanges at higher rates. However, participation levels decline as incomes increase, even among individuals who would be eligible for both premium subsidies and cost-sharing reductions,” said Elizabeth Carpenter, director at Avalere.
For years now, Wall Street has cheered as Obamacare fuelled the stock prices of corporations in the healthcare industry. One of them was eHealth EHTH +0.96%, Inc. (NASDAQ: EHTH), an online health-insurance broker that was founded in 1997.
Obamacare – in case you need reminding – mandates the purchase of private health insurance for working-age Americans above a low income. Last April, The Motley Fool’s Keith Speights speculated that eHealth might have been “Obamacare’s biggest winner”:
The Obama administration revealed Friday that it sent about 800,000 HealthCare.gov customers a tax form containing the wrong information, and asked them to hold off on filing their 2014 taxes.
The self-inflicted bungle follows weeks of administration officials touting a successful enrollment season — one that saw far fewer technical glitches than the rocky launch in late 2013.
About 11.4 million people signed up this season. But the errors in tax information mean that nearly 1 million people may have to wait longer to get their tax refunds this year.
Dec. 26, 2014, was strike three for Pamela Weldin.
The day after Christmas, Weldin, of Minatare, Neb., had logged on to Facebook to find a message from a friend of hers. Included in the note was a link to an article from the Omaha World-Herald announcing that CoOportunity Health, a nonprofit health insurance company offering plans in Nebraska and Iowa, had been taken over by state regulators.
The insurer, one of 23 Consumer Operated and Oriented Plans, or co-ops, started with the backing of the federal government and received $145 million in loans from the Centers for Medicare and Medicaid Services. But, CoOportunity’s expenses and medical claims would far exceed its revenue for 2014.
EARLY next month the Supreme Court will hear arguments in King v. Burwell, the latest significant legal challenge to the Affordable Care Act. The petitioners argue that under the statute, the federal government is not allowed to provide health insurance subsidies in the 37 states that have either declined or failed to establish their own exchanges.
Should the court decide in the petitioners’ favor, most likely in June, critics in Congress will feel vindicated. But then comes the hard part: Congress must be ready with a targeted plan to help at least six million people who would quickly lose that federal assistance, and most likely their insurance.
While several Republicans in Congress have offered serious proposals to replace Obamacare, debating a wholesale replacement of the Affordable Care Act would take months, even years. But it is essential for Congress to move fast on a short-term solution. About 85 percent of people who bought plans on the exchanges receive subsidies, and most could not afford the policies without them. If fewer people are enrolled and new enrollments decline, premiums will rise, leading to the breakdown of the exchange markets.
If the Supreme Court decides that the Affordable Care Act means what it says — that subsidies are available only if a state establishes its own exchange — then President Obama’s signature legislative initiative would be significantly weakened in two-thirds of the states.
Fortunately, there is a way out, one that President Obama, forced by the court to the negotiating table, might be willing to accept. The first step would be for Congress to pass legislation that would allow people to keep subsidies they have already received, and allow subsidies for existing policies to continue through this year so people don’t immediately lose their existing coverage.
Then, beginning in 2016, instead of subsidies to individuals, the 37 states without exchanges could receive a new, capped allotment from the federal government that we call health checks. States could use the allocation to provide immediate premium assistance to people affected by the court decision, and similar checks could be extended to others who would need insurance afterward.
The money would be distributed using the same infrastructure used to disburse funds for the Children’s Health Insurance Program, which covers nearly nine million children. States know how to manage this platform, and could use it to distribute insurance premium support. (The “checks” could, of course, be distributed as electronic credits to insurers, which would be applied on a monthly basis to offset the cost of insurance policies individuals select.)
This might sound like the same subsidies by a different name, but one advantage would be that health insurance policies supported by health checks would not be subject to the Affordable Care Act’s mandates, taxes, insurance rules and benefit requirements.
Currently, to qualify for a subsidy under the act, a health plan must cover a long list of benefits, many of which unnecessarily increase costs. Under our plan, people could apply their allotments toward the purchase of any health insurance plans or policies approved by their state. States could decide what regulations were needed to protect consumers while still providing opportunities for less expensive policies unburdened by excessive regulation and mandates. Such flexibility would also increase enrollment rates: People would be more likely to purchase policies if they had options that cost less and better fit their needs.
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Of course, in reality, should the court decide against the Affordable Care Act, there are other options. Some supporters of the law are encouraging President Obama to simply declare existing federal exchanges to be state exchanges or license them to the states — a move that would further complicate an already ungainly law and already frayed executive-congressional relations.
Others say that the 37 states without federal exchanges would have no choice but to quickly establish exchanges so that residents didn’t lose coverage, even if they were ardent opponents of the law. Some might, but it’s a good bet that many wouldn’t, at least not in time to prevent their citizens from losing coverage.
Health checks offer a politically palatable third way. They would return control over health insurance to the states, with new resources to help their residents. And they would preserve the Affordable Care Act’s present extension of coverage, which would make them more palatable to the Obama administration.
There is no way to know how the Supreme Court will rule in King v. Burwell, but it is incumbent upon both parties in Congress to be ready for the fallout should it decide against the Affordable Care Act. Health checks offer a simple, practical answer, and a start toward further efforts to reform our health insurance system.
WHEN Karen Pineman of Manhattan received notice that her longtime health insurance policy didn’t comply with the Affordable Care Act’s requirements, she gamely set about shopping for a new policy through the public marketplace. After all, she’d supported President Obama and the act as a matter of principle.
Ms. Pineman, who is self-employed, accepted that she’d have to pay higher premiums for a plan with a narrower provider network and no out-of-network coverage. She accepted that she’d have to pay out of pocket to see her primary care physician, who didn’t participate. She even accepted having co-pays of nearly $1,800 to have a cast put on her ankle in an emergency room after she broke it while playing tennis.