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Republican Dilemma on ACA: the Good Parts Take Money

This will be short and sweet, consider it a Health Care Open Thread.

‘Repeal and Replace’ is a pipe dream. Because all the good parts of ACA including guaranteed issue, coverage of pre-existing conditions and inclusions of young people on their parents’ policy actually cost money. At least up front. Which has to come from somewhere. And that ‘where’ tends to come from the pockets of Republican leaning constituencies including medical equipment manufacturers, insurance companies, and medical providers generally. For example a huge part of projected ACA savings comes from reduction of payments for Medicare Advantage, originally billed as a way to leverage the ‘efficiency’ of private (and profit making) economic entities to public ones. Which efficiency calculation has proved problematic even before you calculate the ‘profit’ thingee. With the result that Medicare reimburses Medicare Advantage providing insurance companies with a 14% surcharge over traditional Medicare. Or I should say “reimbursed”, because most of the much ballyhooed “cuts” to Medicare trumpeted by Republicans have come from elimination of the surcharge. Itself rather problematic given that there seems to be no evidence of actual “efficiencies” in MA.

Republicans have no answer for this dilemna. Just about every specific item they oppose about ACA serves as an offset to the increased costs of guaranteed issue and coverage of pre-exisitng conditions. Including their so-called ‘death panels’ which after all are simply cost-benefit analyses of current provision of medical care. Or the same thing that private corporations spend millions on hiring consultants to address. Because when it comes right down to it ‘efficiency’ in the private corporative sense boils down to cost controls.

As a result Republicans are flailing. Their ‘solutions’ such as they are, including cross state border insurance sales and tort reform do little to nothing to having negative consequences on the actual provision of medical care to end-users (aka ‘patients’) but instead reduce burdens on insurance company and provider bottom lines. The same for repeal of the medical device tax and employer mandates and individual mandates. All increase cost while providing bubkis on the ‘available’ and ‘affordable’ fronts.

Those of us who followed health care reform on a daily basis back in 2009 saw that it was at times the rawest form of legislative sausage making. In order to enjoy the nice juiciness of the Bratwurst of Affordable Health Care you had to stomach the knowledge of the nasty bits that actually saved money on the price of the resulting Sausage Dog. And Republicans have no recipe to provide that same Red Hot that doesn’t decrease the quality or increase the sawdust component.

Hoisted by their own Weinar, err Petard.

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Try Something Different, Dems. Like Actual Defense of the ACA. There’s Nothing to Lose But Loss Itself. Really.

Reader Alex Bollinger posted this this morning in the Comments thread to this post of mine from yesterday:

Not only would low-info voters benefit from actually knowing that the ACA is doing good, but a few lefties could use a reminder that it’s not just a neoliberal gift to the insurance industry.

I responded:

Yes, Alex.  Exactly.  It surprises me that the insurance industry hasn’t been sponsoring pro-ACA, anti-AFP-disinformation ads.  I realize that it would involve implicitly acknowledging that their past policies–e.g., denying individual-market coverage to anyone who had even a minor preexisting condition–but they’re in real danger of losing the single-payer war (or at least the public-option) war.

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PRESS RELEASE: Angry Bear Offers Dem Pols Free Political Consulting Service. Free!

Here’s our offer.  It’s a very good offer.  And a serious one.  Seriously.

(Yeah, I’m venting my frustration.)

Who, the HELL, is running the House and Senate Campaign committees? My guess: People who have some personal or financial connection to the usual-suspect Dem consulting firms. Or who just can’t even imagine that, y’know, maybe it’s time to look elsewhere.

So, folks, let’s start a protest movement, right here at AB, and demand a change.

—-

UPDATE: Reader Alex Bollinger posted this in the Comments thread this morning:

Not only would low-info voters benefit from actually knowing that the ACA is doing good, but a few lefties could use a reminder that it’s not just a neoliberal gift to the insurance industry.

I responded:

Yes, Alex.  Exactly.  It surprises me that the insurance industry hasn’t been sponsoring pro-ACA, anti-AFP-disinformation ads.  I realize that it would involve implicitly acknowledging that their past policies–e.g., denying individual-market coverage to anyone who had even a minor preexisting condition–but they’re in real danger of losing the single-payer war (or at least the public-option) war.

Back last December, after it had become clear that many of the state Blue Cross companies–which had by far the largest market share of the individual market in many, many states–was taking obscene advantage of the ACA (and then the healthcare.com debacle) to imply to policyholders of canceled plans that their only option was a very high-priced plan, I wrote here in AB that they were presuming that single-payer or at least the public option could not become a real possibility as a result. And by the very end of the year, after several pundits began making the same point, and it looked like the issue could really take off, the industry apparently did recognize it; it did stop the deceit.

What everyone seems to forget is that until last fall, the wingnut argument, including in the court challenges, was “Freedom! Liberty!”  You never hear that anymore.  Now all you hear is that premiums and out-of-pocket caps are too high and provider networks are too narrow.

Um.  Single-payer would take care of those things.  So maybe sometime before November the industry will realize that it’s very much in its interest to counter the AFP with a massive ad campaign.  Call it survival instinct.

And, who knows?  Maybe by the time the insurance industry realizes that the AFP ads need to be countered with an ad campaign of hard-hitting refutations and real-people  stories, the Dems will have figured that out, too. I never got this idea of addressing the ACA with generic we-need-to-fix-rather-than-repeal it, and hope that that nullifies the law’s unpopularity as a political problem.

The way to nullify the law’s unpopularity as a political problem is to make the law popular.  And all that would take is a good ad campaign.

Please, no more generic keep-and-fix. Please, now, specific refutations and explanations from actual real people .  And, fix?  A public option, maybe?

Seriously, Dems.  Go for it. There’s nothing to lose but loss itself.

 

 

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Here’s what “unaffordable” long-term leukemia care ACTUALLY looks like, Ms. Boonstra. And Rep. Peters.

Just when I thought I’d written my last post on Julie Boonstra, I read Kenneth Thomas’s post below, from Sunday.  The only comment to that post–mine, which I just posted–reads:

How very, very, very sad that there was no ACA during his years of leukemia treatments and hospitalizations, and that we still do not have single-payer.

And how ironic that he had the very same fatal illness that Julie Boonstra has.  I’d like to shove your post in her face, Kenneth.

I’d also like to see Rep. Gary Peters use this family’s situation in his Senate campaign ads in Michigan, and ask whether Julie Boonstra has any idea of what “unaffordable” means with respect to medical care for leukemia.

When she cut the first of her two ads for AFP in mid-February, Boonstra apparently was genuinely unaware of the full terms of her new Blue Cross plan and of the out-of-pocket-costs limitations legislated in the ACA.  And part of the reason why was the failure of healthcare.com to work in October and November and, apparently at least for Michigan’s exchanges, during early December–coupled with Michigan’s decision to not provide its exchange system through a webstie and run and operated by the state.

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Okay, so why was Julie Boonstra advocating for lower-cost oral chemotherapy treatment in Washington when she was getting that medication for a set, low monthly price under the insurance plan she liked and did not want to part with? Was she concerned about reaching her annual or lifetime coverage cap?

Boonstra is the ex-wife of Mark Boonstra, the former Washtenaw County GOP chairman whom Gov. Rick Snyder appointed to the Michigan Court of Appeals in 2012. Julie Boonstra said she’s never been a political person beyond advocating for lower-cost oral chemotherapy treatment in Washington. [My boldface.]

Dexter cancer patient who called health care ‘unaffordable’ will save more than $1K, Marisa Schultz, Detroit News, Mar. 10

Boonstra famously was quoted in that article as saying when told the details of her new Blue Cross plan that it  “can’t be true” that that plan is cheaper, by a minimum of $1,200 for the year, than her old plan. “I personally do not believe that,” Boonstra told Ms. Schultz.   Schultz continued:

She said she still fears her costs will be unaffordable because she could be hit with large out-of-pocket bills in the early months when she wouldn’t have the money to pay. She also said her out-of-pocket maximum could be higher than advertised because there’s one prescription that was previously covered by her old plan that isn’t and she now buys with a separate prescription discount card.

An interesting comment thread developed here during the last few days in response to my post on Tuesday about the Detroit News article.  I titled that post “Julie Boonstra Tells the Detroit News Why Her New Healthcare Plan Doesn’t Work for Her: It Requires Her to Read the Policy or Ask Blue Cross a Few Basic Questions In Order to Learn What the Plan Actually Covers and What Her Expense Cap Is.”  One subject of the discussion concerned her statement that there’s one prescription that was previously covered by her old plan that isn’t and she now buys with a separate prescription discount card.  I pointed out that she does not say that that prescription is part of her cancer treatments, and that according to a Blue Cross spokesperson Ms. Schultz contacted for the article, it is not; all her cancer drugs are covered.

I also noted that Boonstra has not said that her old plan covered all medications.  She just said it covered all of her current medications.  And since I happen to know, having shopped there many times, that there is a Rite Aid pharmacy on the far west side of Ann Arbor, just east of Dexter, a village that is a small bedroom community mainly for people who work in Ann Arbor, I posted this from Rite Aid’s website:

Rite Aid, 500 generic-brand prescriptions available: $9 for a 30-day prescription; $16 for a 90-day one.

I also said in that comment something that, surprisingly, no one else (to my knowledge) has mentioned:

She also, by the way, has not said–because she doesn’t know, and either does Blue Cross–what her old plan would have cost in monthly premiums and out-of-pocket expenses and co-pays THIS YEAR, had the plan not been discontinued. But it sure as hell would be interesting to know how her old plan differed in costs and coverage last year from the year before, and how much her premiums and out-of-pocket and co-pay costs went up in, say, the last five years on that plan.

But there’s an even more fundamental question about Boonstra’s comments to Ms. Schultz: Why was Boonstra advocating for lower-cost oral chemotherapy treatment in Washington during a period when she was paying set, low monthly out-of-pocket costs and was happy with her plan?

When I first read the article it seemed strange to me that this anti-federal government Republican was advocating in Washington for federal regulation of the cost of a particular medical prescription.  But only after reading through the comments to my post on the article, in which I did not mention that statement of hers, but a commenter to the post did, did it occur to me that there was something more, something fundamental, wrong with this picture.

This clearly is someone who is locked deep inside the Fox News/Rush Limbaugh sphere of reality.  She seems to want a single-payer, Medicare-for-all type of healthcare insurance system, and wants the actual benefits of the ACA, including, apparently–no, undoubtedly–the removal of annual and lifetime caps on coverage. And it’s a safe bet that she personally does not believe that the ACA includes these bars, and that that is why her old plan was cancelled.  It can’t be true, because Fox News and Rush Limbaugh haven’t mentioned it.

This woman is among those who cannot be reached with facts.  But they are in the minority among the electorate. It’s deeply unfortunate that our Democratic president won’t educate the public about the actual specifics of the plan.  He doesn’t do specifics in speaking to the public, and doesn’t do facts and explanations at all. And he certainly doesn’t do refutations of misinformation.

We know by now that hell will freeze over before he refutes Boonstra, Emilie Lamb and the others in the AFP ads, and I guess that’s okay, because everyone’s tuned him out anyway.  But why has it taken so very, very long for the Dems to begin to take over this slack?  Their failure to do do this because Obama is unpopular is a key reason why Obama is so unpopular. Or at least a key reason why Obamacare is unpopular.  Which, apparently more than anything else, is what matters this election cycle.

As for Boonstra, reader Alex Bollinger posted this comment this morning to my earlier post:

Yes, we should feel compassion for this woman. And our blame should be mostly on the political consultants who are taking advantage of her loyalty to movement conservatism (I don’t think she’s stupid at all because I’ve seen very intelligent people really, really want to believe something is true so much that they believe their rightthink).

But her comments are intended to rescind the ACA, which has already insured over 12 million people. I’m sure there are people who either have or will get cancer among those 12 million. Just because they don’t have TV ads doesn’t mean that their lives aren’t important as well, and Boonstra has the ability to temper her ideological fervor with, you know, having a basic understanding of her plan before going on national TV to talk about it.

Exactly.

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Yes, Virginia, there really IS a (rapidly-increasing) possibility of a healthcare insurance public option. The private insurance companies are inviting it.

 

When millions of health-insurance plans were canceled last fall, the Obama administration tried to be reassuring, saying the terminations affected only the small minority of Americans who bought individual policies.

But according to industry analysts, insurers and state regulators, the disruption will be far greater, potentially affecting millions of people who receive insurance through small employers by the end of 2014.

Second wave of health-insurance disruption affects small businesses, Ariana Eunjung Cha, Washington Post, today

[W]ith the single exception of the disastrous rollout of Healthcare.com, which is purely a technology issue, the high-profile issues concerning Obamacare since Oct. 1 highlight not generic problems with government involvement in healthcare insurance but instead the problems of a system that piggybacks on the for-profit private insurance industry and neo-federalism-structured federal programs that rely heavily or entirely upon cooperation of state governments.

What to Do When a High-Profile U.Chicago Economist Says the Airline, Telephone and Package-Shipping Industries Prohibit Use by Preexisting Flyers, Callers and Shippers: If you’re a liberal, take this ball and run with it!, Me, Angry Bear, Dec. 26

The Washington Post article goes on to say that many of the small-business cancellations are occurring not because the current policies are substandard under the ACA, but instead are only indirectly related to the statute. Insurers, the article explains, want to “move customers to new plans designed to offset the financial and administrative risks associated with the health-care overhaul.” To that end, “they are consolidating their plan offerings to maximize profits and streamline how they manage them.”

To which I say: Go for it, insurance industry. Please do.  In my Dec. 26 post, I wrote:

[W]hat’s happening, suddenly, is something I predicted in recent posts here: That the individual-market insurance industry’s fall-of-living-dangerously, during which (led apparently by the various Blue Cross companies) it drastically overplayed its hand in the last three months by, for example, telling premium-holders, falsely, that their cancelled policies could be replaced only by vastly-more-expensive policies, would trigger reinvigorated calls for a “public option for the single-payer market and maybe even for a single-payer option across the board.

But something else is happening, as well: The right is recognizing that the problems with Obamacare, rather than broadening the appeal of a return to the status quo, is instead more likely to dramatically broaden the appeal of a public option.  And, because employers that provide healthcare coverage are scapegoating Obamacare for their unrelated decisions to further limit their already-increasingly-limited premium contributions and the like, the formerly unthinkable–a single-payer-for-all option–may well soon become the very thinkable.

The “right,” in that last paragraph, refers to U.Chicago Business School economist John Cochrane and a recent article of his that my post’s title summarizes. Cochrane’s piece, an op-ed published in the Wall Street Journal titled “What to Do When Obamacare Unravels,” struck me as bearing the earmarks of rightwing desperation.

Late this month in his State of the Union address, Obama will discuss Obamacare.  He will use the tired-but-by-now-obligatory tactic of having real Americans in the audience, whom he will name and whose family is benefiting tremendously from the law. He may even be astute enough–although I doubt this, since astuteness is not his thing–to include among those Americans people who panicked after receiving cancellation notices from one of the Blue Cross affiliates (it’s virtually always one of the Blue Cross affiliates, usually but not always an AnthemBlueCross affiliate) and was profiled in some news article as being told in the cancellation letter that the only option henceforth was some poorer-coverage or wildly-more-expense (or both) policy, only to learn later about the actual options.

What he won’t do, though, is what most he should do: Explain, in actual detail, using genuine specific data depicted in charts, that for decades now the unremitting and rapidly-accelerating trends in healthcare insurance have been ever-narrowing provider networks and large increases in premiums and out-of-pocket costs in both the individual market and the employer-based group-insurance market.  And to say that it soon will be clear whether or not the private for-profit healthcare-insurance market can meet the needs of the general public or whether instead those needs can be met only through a government-run single-payer insurance system or some other non-profit system similar to one or another approach that works so well in, say, Australia, France, or Germany. And then propose a public option, not just for the individual market but also for employer-based group insurance.

No, Obama himself won’t propose this.  But progressive Democratic congressional candidates should, and soon. Obama, like most Washington pols and almost all political pundits, is always incredibly late to the change-in-progressive-and-mainstream-political-winds party. If he ever arrives at the party at all. (He’s still appointing federal judges whose main credential is a history as a prosecutor or some other tough-on-crime, pro-police background–he hasn’t noticed that this no longer appeals even to Republicans, at least not those of the libertarian variety–but that’s a subject for a later post.) The Washington Post piece notes that most of the small-business-group policy cancellation notices will be sent in October, near the start of the open-enrollment period and also just before the midterm elections.  This, the writer points out, “could be difficult for Democrats who are already fending off Republican attacks about the Affordable Care Act and its troubled rollout.”

Then again … maybe not so difficult, after all. The political winds are moving forward, not backward. All the Dems need is a coherent progressive policy proposal.  And a few coherent messengers for it, who no longer need fear that they will be killed.

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Guest post: Under Obamacare, Will You Receive a Subsidy…We Now Have Real Numbers

 by Maggie Mahar

Under Obamacare, Will You Receive a Subsidy to Help You Buy Your Own Insurance? We Now Have Real Numbers That Will Let You Calculate How Much You Will Receive

Note to Readers: A longer version of this post appeared yesterday on HealthInsurance.org.

Up until now, when Obamacare’s supporters and reform’s opponents squabbled over what insurance will cost in 2014, they had to rely on estimates and national averages. But now we have real numbers.

Eleven states have announced the rates that insurers will be charging in their Exchanges-marketplaces where individuals who don’t have employer-sponsored coverage can shop for their own insurance.

Subsidies Will Be Based On the Cost Of A Silver Plan Where You Live,

Middle-income as well as low-income people buying coverage in the Exchanges will be eligible for government subsidies that will come in the form of tax credits. Anyone earning between 100 and 400 percent of the federal poverty level (FPL) (now $11,490 to $45,960 for a single person, and up to $126, 360 for a family of six) will qualify.

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Conservative roots of Obamacare

by Kenneth Thomas
 
Conservative roots of Obamacare

The pile-on continues. As I discussed in February, Stuart Butler of the Heritage Foundation wrote a breath-taking op-ed in USA Today (via Don Taylor) denying that he fathered the individual mandate. In fact, his revised 140-page research paper was published January 2, 1989, before President George HW Bush came into office, let alone President Clinton, whose proposals Butler says his research was directed against. Two conservatives, Avik Roy of Forbes and James Taranto of the Wall Street Journal, played strong roles in locking down the point that Butler was the first to propose the mandate.
 
Today, J.D. Kleinke of the American Enterprise Institute goes straight to that 1989 report in a New York Times opinion piece to once again lay the mandate at the feet of Heritage. And why not? According to him, the Affordable Care Act is a conservative’s dream.

The rationalization and extension of the current market is financed by the other linchpin of the law: the mandate that we all carry health insurance, an idea forged not by liberal social engineers at the Brookings Institution but by conservative economists at the Heritage Foundation. The individual mandate recognizes that millions of Americans who could buy health insurance choose not to, because it requires trading away today’s wants for tomorrow’s needs. The mandate is about personal responsibility — a hallmark of conservative thought.

Kleinke argues that Romney’s incoherence on health care stems precisely from rejecting his accomplishment in Massachusetts. Romney can’t offer anything better than the ACA because it is the only conservative way to overcome the problems of the health care market while remaining based on the market and individual responsibility. With no single payer and no public option, it is not surprising that, as he puts it, “the health insurance industry has been quietly supporting the plan all along.”
 
Aside from his odd notion that single payer represents a “government takeover of health care” (Canada’s Medicare is not the United Kingdom’s National Health Service), Kleinke’s column is on the money: historically, the mandate was developed by Heritage economists, the ACA more broadly relies on conservative rather than liberal principles, and many liberals have been unenthusiastic for just that reason.

Heck, I’m unenthusiastic (single payer!). But it’s a big improvement over the status quo that is already providing benefits to millions of people, whether for young adults, the millions of consumers getting rebates due to the medical loss ratio rule, or for seniors getting rid of the donut hole and gaining free preventive care.

crossposted with Middle Class Political Economist

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Hospital Consolidation and ACO’s

Jason Shafrin over at the Healthcare Economist points to this recent paper over at the RWJF. Interestingly the authors find that hospital consolidation increases prices and could decrease quality. Something that many of us have considered in the past.

In concentrated markets, the effects were even more pronounced with price increases over 20% noted.

Competition was noted to increase quality under an “administered” pricing system, ala the NHS in the UK. The evidence for competition increasing quality in a market system was much more mixed.

I have thought this for some time, and have even wrote about the concepts of leverage in the past. For example, I have cited a BNET article before. When one examines the the health markets in Milwaukee and Chicago, which are both midwestern cities, and geographically close to each other, one finds higher prices in Milwaukee, with providers not accepting less than 200% of Medicare. Which does not seem intuitive, as there is far more market competition in the health insurance industry there. In Chicago, one insurer, BC-BS, is rather dominant and prices are lower, with providers accepting 112% of Medicare on average. It would seem to make sense that increasing the leverage of the hospitals and providers through the mechanism of consolidation will increase prices. The same thing happens in Milwaukee, which has no dominant insurer, and therefore is unable to exert leverage over the hospital systems in Milwaukee.

The ACO models as proscribed by the ACA will increase consolidation. By developing an accountable model of care delivery, providers will attempt to consolidate to increase quality and minimize risk exposure in the sense of decreasing reimbursements.

The problem with the RWJF paper, as it rightly notes, is that the study does not really examine integrated health care systems. When you look at consolidation with true vertical and horizontal integration, it is my belief that quality improves even in the absence of competition. True integration in the case of Mayo Clinic and Kaiser also lowers prices.

In essence, I don’t think the problem is consolidation…..I think the problem is consolidation in the absence of integration.

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Medicare Cuts: What is the Fight About?

by Run75411

“Water For Elephants”

carrying water for elephants” is a phrase that means carrying a heavy load, much like carrying a secret that you can’t tell even someone you love wholeheartedly, just as in the end Jacob does for his wife
.
An elephant drinks 25-75 gallons of water a day far more than any man would be able to carry at any given time. http://angela-michelle.hubpages.com/hub/Water-For-Elephants “Water for Elephants” Sometimes when you get older . . . things you think on and wish on start to seem real. And then you believe them, and before you know it they’re part of your history.”

Most recently former NY Lt. Governor Betsy McGaughey in the WSJ (August 8th) commented on the ACA in “ObamaCares’s Phoney Deficit Reduction” choosing to carry water for the Republican candidates Romney and Ryan with the hope she can convince voters that President Obama’s ACA will not reduce the cost of Medicare and instead will rob the Medicare TF. By her words alone, Ms. McGaughey cannot change the numeric of Medicare expected and occurring reduced growth and costs resulting from the passage of ACA. In her, Romney and Ryan’s mines the logic of how the robbery of benefits and the Medicare is all too real even when the proof of the opposite is self-evident. The three will have to do double time if they are to provide enough water to conflate the ACA to the public if in fact they are to make them believe the illusion.

Ms. McGaughey critiques CBO Director Elmendorf’s and the JCT’s analysis (letter to House Leader John Boehner) on the impact of repealing the ACA, what it means to the country in increased costs, and then conflates the cuts to the Advantage Program and other parts of Medicare as actual cuts in benefits to Medicare recipients. The ACA states Medicare benefits cannot be reduced for Medicare recipients.

As operated by commercial insurance companies, the Advantage Program intent was to provide competition to Medicare and separate from Medicare. As Betsy believes and everyone else imagines, private commercial insurance can provide similar benefits at a lower cost and more efficiently. Except the Advantage Program did not do so and has out spent Medicare by an average of $1000 or 7% to 18% (dependent on who you read) more and in total for similar Medicare benefits.

                                        Ezra Klein , “Romney’s right: Obamacare cuts Medicare by $716 billion. Here’s how.”  
                                  Note: HMO is health maintenance organization; PPO is preferred provider organization.
   http://www.washingtonpost.com/blogs/ezra-klein/wp/2012/08/14/romneys-right-obamacare-cuts-medicare-by-716-billion-heres-how/ 

                  

The very same CBO Director who wrote about the impact of repealing the ACA to House Leader John Boehner and the resulting increased costs was also a part of the CBO team which pounded the final nail into the “Hillarycare” coffin resulting in its demise in Congress. Healthcare then was 20% of the cost of what it is today. I doubt Director Elmendorf has lost any of his boldness since Clinton. So, who is right?

The best way to counter supposition and conjecture by Romney, Ryan, and Ms. McGaughey is to present detail about the cuts and to what they are related , the same as the actual cost of the Advantage program in relation to Medicare. The planned reduction in Medicare costs come from three areas, which also include the government sponsored Advantage program.

                                SOURCE: Medicare Payment Advisory Commission Report to Congress, March 2008.
                               “Medicare Advantage”; Kaiser Foundation http://www.kff.org/medicare 

30.2% of the planned reduction in Medicare costs will come from the elimination of Advantage subsidies as I stated above. The ACA also applies the same rules to the Advantage insurance programs it applies to hospitals by tying reimbursement (or fees) to quality of outcomes instead of a fee for the number of services provided.

34.8% of the reduction in cost comes from revised calculations in the reimbursement of hospitals for provided services. Hospitals not only give up the pay-for-services cost model to embrace better quality outcomes for services cost model; but, they move to electronic record keeping (which proved to be cost effective with the VA, Longman “Best Care Anywhere“), and the bundling of payments eliminating multiple billings and forcing a split of the total compensation. Knowing the increase in patients coming from the addition of the uninsured, there is also the influx of an aging baby-boomer population, which also influenced hospitals to accept the changes.

35% of the reduction result from a combination of smaller cuts in extra funds ( ~5%) given to hospitals to cover the uninsured (not needed as more people will be covered), reductions in homecare providers (~8%), fraud reduction, etc..

The $716 billion is far larger than the initial $449 billion first reported. In 2010, the CBO arrived at an estimate of savings of ~$449 billion starting from 2012 onwards and covered 6- 7 years from when the bill takes full effect in 2014 to 2019. The second estimate of savings was the result of John Boehner’s request for a review of the costs and gains realized from the repeal the ACA in its entirety. The second review covered the period from 2014 to 2022 and resulted in the $716 billion. http://www.brookings.edu/blogs/up-front/posts/2012/08/15-medicare-cuts-galston “Medicare Cuts: What is the Fight About?”


And what of other things implied?

– Healthcare spending was 17.9% of GDP in 2010 and will rise to 19.6% in 2021. Neglected and a part of the article from which this snippet of CMS information was pulled is this: Current projections also do not include potential drops in spending through health care delivery reforms, such as the accountable care organizations and medical homes being promoted by the health law.” In other words, the author projections of $ and % are being made as if the ACA did not exist. The author of this particular article is an MBA and not an economist or a doctor. Quelle Surprise?

– “Repeal also would reduce government spending, lower taxes, and undo the evisceration of Medicare; all good results.” I guess it is still unclear how Medicare is to be eviscerated under the ACA when Obama will plow the results back into Medicare, and the CMS has lengthen the TF out to 2024-2029. Comparing this to Romney wishing to end Medicare and Ryan wanting to keep the very same reductions as the ACA and take the savings for tax breaks, who is eviscerating what?

Healthcare Costs have been decreasing for years? Maybe not so long and since 2009/2010 at the earliest?

Secretary of Heath Kathy Sebelius made the comment in an article that a family of 4 paid ~$6,000 for private insurance in 2000 and ~$12,000 for similar insurance in 2009. http://www.voxxi.com/kathleen-sebelius-affordable-care-act/ “Public Needs To Get Their Facts Straight” Part of this is due to increased administrative costs and much more is a reflection of increased healthcare care costs which insurance and Medicare reflects.

Medicare has had slower growth because it has taken the necessary actions to control much of the costs associated with healthcare through pilot programs, negotiations, etc. The results of its actions are clear in the S&P Indices. The increase in enrollment of healthier patients over the last two recessions has contributed to the slow down; however, it is the ACA which started hospitals and doctors to begin to plan for full implementation and take the steps necessary to meet ACA goals for commercial insurance.

spending per enrollee slowed to 4.2% annually, as compared with 4.5% among private payers. After large increases in enrollment due to two recessions and the increasing numbers of Americans with disabilities are accounted for, growth of Medicaid spending per enrollee was relatively slow (less than 3% per… http://www.nationaljournal.com/healthcare/both-obama-and-romney-medicare-plans-fail-to-solve-the-cost-problem-20120816Medicare and Medicaid Spending Trends and the Deficit Debate”

– And the Pink Cadillac Tax? The ACA does impose a tax on plans exceeding $27,000 and typically carried by executives in the rarefied levels of management. They can always shuck it off and go to one of the insurance exchanges for a cheaper plan with no tax. There is also an excise tax on plans with premiums exceeding $10,200 for individuals or $27,500 for a family tax Other taxes include Increase Medicare tax rate by .9% and impose added tax of 3.8% on unearned income for high-income taxpayers.

So what is the Fight About? It is about whether Romney/Ryan can eliminate Medicare and repeal the ACA, and keep the same proposals President Obama put in play for Medicare but using the savings from it elsewhere (tax breaks – think SS surplus) rather than within Medicare, as both are opposed to Obama plowing the savings back into Medicare. http://www.brookings.edu/blogs/up-front/posts/2012/08/15-medicare-cuts-galston “Medicare Cuts: What is the Fight About?”

References:


Maggie Mahar Health Beat Blog

http://www.cbpp.org/cms/index.cfm?fa=view&id=3161 Federal Government Will Pick Up Nearly All Costs of Health Reform’s Medicaid Expansion

http://www.washingtonpost.com/blogs/ezra-klein/wp/2012/08/14/romneys-right-obamacare-cuts-medicare-by-716-billion-heres-how/ ” Romney’s right: Obamacare cuts Medicare by $716 billion. Here’s how
http://www.drugchannels.net/2011/08/cms-bright-future-for-drug-spending-in.html CMS Bright Future for Spending . . .
http://www.cms.gov/apps/docs/ACA-Update-Implementing-Medicare-Costs-Savings.pdf
Affordable Care Act Update: Implementing Medicare Cost Savings
http://www.ajhp.org/content/69/5/405.abstract Projecting future drug expenditures—2012
http://www.brookings.edu/blogs/up-front/posts/2012/08/15-medicare-cuts-galston Medicare Cuts: What Is the Fight About?
http://www.kff.org/medicare/upload/2052-11.pdf Medicare Advantage
http://factcheck.org/2012/06/romney-obama-uphold-health-care-falsehoods/ Romney, Obama Uphold Health Care Falsehoods
http://www.voxxi.com/kathleen-sebelius-affordable-care-act/ Public Needs . . .
http://www.reuters.com/article/2012/06/12/us-usa-healthcare-spending-idUSBRE85B1DI20120612 Government forecasts modest health spending growth
http://online.wsj.com/article/SB10001424052702303768104577462731719000346.html?mod=WSJ_hps_LEFTTopStories ” Steep Rise in Health Costs Projected”
http://www.nejm.org/doi/pdf/10.1056/NEJMp1204899 “Medicare and Medicaid Spending Trends and the Deficit Debate”
http://www.urban.org/UploadedPDF/412419-Containing-the-Growth-of-Spending-in-the-US-Health-System.pdf “Containing the Growth of Spending in the U.S. Health System”

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