ObamaCare Watch Newsletter 3/2/18

  • Can States Repair Obamacare’s Damage? –
  • Changes to Part D Move The Country Closer to Government-Run Health Care –
  • The Trillion Dollar Surprise in The Budget Deal –
  • Trump’s Next Health Care Target: HRAs –
  • Liberals Have A New Plan to Take Over the Health Care System. What You Need to Know. –
  • Democrats Considering a New Strategy to Expand Health Coverage as Frustrations Build with Obamacare –
  • 20 States Sue over Obamacare Mandate — Again –
  • CA Made Medicaid Payments on Behalf of Beneficiaries Who Did Not Meet Requirements –
  • Scott Walker Signs Bill Aimed at Stabilizing ObamaCare Market –

Stabilizing the ACA’s Individual Markets

Can States Repair Obamacare’s Damage?
By Doug Badger and Rea Hederman
National Review, March 2, 2018

Having failed to repeal the Affordable Care Act, congressional Republicans now want to create a new corporate welfare program to save it. Here’s a better idea: Congress and the administration should give states more latitude to clean up the mess—at no additional cost to the federal government. That is a central recommendation of a new study co-authored by Doug Badger, Senior Fellow at the Galen Institute, and Rea Hederman, Vice President of Policy at The Buckeye Institute. The study examines congressional and federal proposals that surfaced throughout last year in the broader context of the “repeal and replace” debate. The most promising ideas to repair broken insurance markets emanated not from Washington, but from the states. Read the full Mercatus Center study here.


Budget Deal Impact

Changes to Part D Move The Country Closer to Government-Run Health Care
By Matthew Kandrach
Morning Consult, Feb. 26, 2018

The recently passed 600-page Bipartisan Budget Act of 2018 will impact almost every sector of the American economy. But one provision has the potential to do real damage. The BBA fundamentally alters the popular and successful Medicare Part D prescription drug benefit and puts our nation further down a path towards socialized medicine. BBA’s Part D provision is a handout to insurers. Rather than injecting greater competition into the marketplace, the new law picks winners and losers, absolving insurers of risk by instead transferring their responsibility to pharmaceutical manufacturers—a change that will require drug companies to shoulder 70% of the costs.

The Trillion Dollar Surprise in The Budget Deal
By John C. Goodman and Thomas R. Saving
Forbes, Feb. 22, 2018

The most significant federal entitlement reform in our lifetime was a little noticed provision that Democrats included in the ACA. Yet according to the Medicare Trustees report that followed, this one provision eliminated $52 trillion of unfunded federal government liability—an amount that was more than three times the size of the US economy. The provision, enacted by Democrats to help pay for Obamacare, was a cap on Medicare spending—in perpetuity! It would have been enforced through the Independent Payment Advisory Board or the HHS Secretary, primarily by reducing fees to providers. Had the IPAB been allowed to do so, estimates are that by 2034, Medicare fees for doctors and hospitals, currently about two-thirds of the private sector, would fall to 40%. Congress eliminated the IPAB in the BBA.


Trump Administration Agenda

Trump’s Next Health Care Target: HRAs
By Bob Herman
Axios, Feb. 26, 2018

The Trump administration focused on three primary health insurance ideas when it released its health care executive order last October. Association health plans: Check. Short-term health plans: Check. What’s next? Health reimbursement arrangements, which allow workers to buy coverage with tax-free dollars. Here’s what HHS could do next: 1) Relax rules so companies of all sizes can take advantage of HRAs, and 2) Now that the individual mandate has been zeroed out, the administration could open the door for companies to provide funds to buy coverage that is noncompliant with ACA requirements.


Liberals’ Slow March to Single-Payer 

Liberals Have A New Plan to Take Over the Health Care System. What You Need to Know.
By Chris Jacobs
The Federalist, Feb. 23, 2018

The Center for American Progress has proposed a plan for government-run health care, which the liberal think tank calls “Medicare Extra.” Unlike Sen. Bernie Sanders’ (I-VT) single-payer system, which would abolish virtually all other forms of insurance, the plan would not ban employer coverage outright—at least not yet. In broad strokes, CAP would combine Medicaid and the individual insurance market into Medicare Extra, and allow individuals with other coverage, such as employer plans, traditional Medicare or VA coverage, to enroll in Medicare Extra instead. The plan would shift the health care market firmly into the government’s control: “Newborns and individuals turning age 65 would be automatically enrolled in Medicare Extra. This auto-enrollment ensures that Medicare Extra would continue to increase in enrollment over time.”

Democrats Considering a New Strategy to Expand Health Coverage as Frustrations Build with Obamacare
By Noam N. Levey
Los Angeles Times, Feb. 27, 2018

A growing number of Democrats believe the party should focus on expanding popular government programs like Medicare and Medicaid. The emerging strategy—which is gaining traction among liberal policy experts, activists and Democratic politicians—is less sweeping than the “single-payer” government-run system that Sen. Bernie Sanders (I-VT) made a cornerstone of his 2016 presidential campaign. These Democrats see the expansion of existing public programs as a more pragmatic and politically viable way to help Americans struggling with rising costs and correct the shortcomings of the ACA.  (They are well underway already, as Medicaid has ballooned to 75 million enrollees and Medicare at 55 million.)


 

States

20 States Sue over Obamacare Mandate — Again
Jennifer Haberkorn
Politico, Feb. 26, 2018

Twenty states have filed a lawsuit against the Trump administration over Obamacare’s individual mandate. Wisconsin, Texas, and 18 other states argue that, since Congress repealed the individual mandate’s tax penalty for not having coverage, that means the mandate itself—and the whole health care law—is invalid. The tax change “eliminated the tax penalty of the ACA, without eliminating the mandate itself,” the states argue in a complaint filed in U.S. District Court in the Northern District of Texas. “What remains, then, is the individual mandate, without any accompanying exercise of Congress’s taxing power, which the Supreme Court already held that Congress has no authority to enact.”

CA Made Medicaid Payments on Behalf of Beneficiaries Who Did Not Meet Requirements
By Daniel R. Levinson, Inspector General
Department of Health and Human Services Office of the Inspector General

The HHS Office of the Inspector General (OIG) found that California is making excessive payments for Medicaid: Studying a six-month period and a sample of 150 beneficiaries, the OIG found that California made Medicaid payments on behalf of 112 eligible beneficiaries. However, California made payments on behalf of ineligible and potentially ineligible beneficiaries for the remaining 38 beneficiaries. On the basis of sample results, the OIG estimates that California made Medicaid payments of $738 million ($629 million Federal share) on behalf of 366,000 ineligible beneficiaries and $417 million ($402 million Federal share) on behalf of 79,000 potentially ineligible beneficiaries. [With almost no state funds at stake, California has no incentive to check wasteful and wrongful Medicaid spending.]

Scott Walker Signs Bill Aimed at Stabilizing ObamaCare Market
By Jessie Hellmann
The Hill, Feb. 28, 2018

Gov. Scott Walker (R-WI) who has been one of ObamaCare’s most vocal opponents, signed a bill Tuesday that would shore up the law’s insurance markets. The bill would authorize the state to apply for a federal waiver to offer a reinsurance program covering 80% of medical claims costing between $50,000 and $250,000. The program would cost $200 million, with the federal government paying 75% of the costs, and is meant to lower premiums for everyone else by using taxpayer funds to help pay claims for the sickest, most expensive patients.

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