If ObamaCare were working as well as supporters claim, would New York state have just decided to steer more than half of its subsidized exchange enrollees to a public managed-care plan? New York is the second state after Minnesota to adopt a Basic Health Program for households up to 200% of the poverty level. It’s a government-managed health care option included in the 2010 reform law.
Following Minnesota is a curious move. Minnesota has signed up just 22% of those eligible for exchange coverage, 48th among all states and barely half the U.S. average of 42%, according to the Kaiser Family Foundation.
The MNsure exchange also ranks near the bottom in its share of young-adult enrollees (24.2%) and near the top in its share of adults age 55 and up (33%).
To top it off, PreferredOne quit the Minnesota exchange despite being its dominant insurer in 2014, hardly a vote of confidence.
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.
Almost two-thirds of enrollees receiving advance premium tax credit (APTC) in Marketplaces had to pay back an average of $729 of the tax credits they received in 2014, according to H&R Block, reducing these enrollees’ average tax refund by 33%. Approximately one in four enrollees with APTC received a refund, averaging $425, which represented an increase in their refunds of approximately 18%. A smaller percentage, almost 13%, of those with APTC had no repayment or refund due, meaning they estimated their 2014 income accurately. Finally, the average payment due for those who did not maintain coverage during all or a portion of the 2014 benefit year was approximately $178. A previous study by the Kaiser Family Foundation estimated, based on tracking income changes typical of the subsidy-eligible population, that taxpayers receiving APTC were about as likely to owe some repayment (50%) as receive a refund (45%), and found that the average repayment ($794) and refund ($773) were similar.
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
Two Republican committee chairmen are pressing the Obama administration to improve its oversight of how state-run ObamaCare marketplaces use federal dollars, citing an inspector general report on potential violations of law.
Sens. Orrin Hatch (R-Utah) and Chuck Grassley (R-Iowa) wrote to the head of the Centers for Medicare and Medicaid Services (CMS) on Monday asking for the agency to issue clarifying guidance on how the federal dollars can be spent.
State-run ObamaCare marketplaces received federal funds to help set themselves up, but after Jan. 1 of this year, they marketplaces are supposed to be self-sustaining. They are now prohibited by law from using federal funds for “operating expenses.” They can only use the money for “design, development, and implementation.”
The problem is that the definition of these two categories can be unclear, as noted by an HHS Inspector General report late last month. The senators want clearer definitions from CMS.
State-based marketplaces (SBMs) “cannot be allowed to use hard-earned taxpayer dollars for expenses that are statutorily prohibited,” the senators write.