ObamaCareWATCH – Weekly Newsletter – February 16, 2018

Getting the Numbers Right

Why CBO Should Abandon Its Flawed Analysis of the Center for Medicare and Medicaid Innovation
By Doug Badger
National Taxpayers Union Foundation, Feb. 8, 2018

One of the impediments to repealing and replacing Obamacare has been a belief by the Congressional Budget Office (CBO) that substantial federal savings will be achieved by innovative demonstration projects in Medicare, Medicaid, and CHIP called for under the ACA. Galen Institute Senior Fellow Doug Badger says CBO’s forecast of $45 billion in savings over 10 years is flawed because the office “ascribes unobserved and unobservable savings to projects that CMMI has not yet undertaken (and may never undertake).”  He says the CBO’s judgements “are in some cases questionable, in others mistaken and in still others rendered obsolete.” He concludes that it is vital for policymakers have realistic, analytically-grounded estimates, assumptions, and projections on which to base future decisions about health reform.

Obamacare Repeal and Replace

Trump Budget Seeks Savings Through Obamacare Repeal
By Nathaniel Weixel
The Hill, Feb. 12, 2018

The White House budget for fiscal year 2019 seeks major savings by repealing ObamaCare and endorsed a Senate GOP bill as the best way to do so. “The Budget supports a two-part approach to repealing and replacing Obamacare, starting with enactment of legislation modeled closely after the Graham-Cassidy-Heller-Johnson (GCHJ) bill as soon as possible,” the White House said in its budget request. The legislation from Sens. Lindsey Graham (R-SC), Bill Cassidy (R-LA), Ron Johnson (R-WI) and Dean Heller (R-NV) would replace ObamaCare with a series of block grants to states. The budget proposes over $90 billion in savings over 10 years if the policies in the Graham-Cassidy bill were enacted.

How One Conservative State Is Flouting Obamacare
By Paul Demko and Rachana Pradhan
Politico, Feb. 12, 2018

Idaho has a maverick plan to let insurers sell plans that don’t meet Obamacare coverage rules and patient protections to give more health insurance options to citizens who can’t afford the expensive Obamacare policies. Gov. Butch Otter issued an executive order to authorize a state-level version of the “Cruz amendment,” which Senator Ted Cruz (R-TX) offered to the Better Care Reconciliation Act during efforts to repeal the ACA last year. The amendment would have allowed insurers to offer non-ACA-compliant plans in the individual market so long as they also offered plans through the marketplace.  Other conservative states are keeping a close eye on the option.  HHS Secretary Alex Azar said he would closely scrutinize Idaho’s plan, but he said it was too early to know what action he might take.

Azar Eyes Relaxing Restrictions on Physician-Owned Hospitals
By Susannah Luthi
Modern Healthcare, Feb. 14, 2018

Two weeks into his new post, HHS Secretary Azar took another step in the Trump administration’s move toward relaxing the Affordable Care Act’s moratorium on new physician-owned hospitals. In the HHS budget hearing before the House Ways and Means Committee, Rep. Sam Johnson (R-TX) asked for Azar to commit the administration to help repeal the ACA’s “ban” on new construction or expansion of physician-owned hospitals, which are providing more options for quality surgical care, often at a lower cost than large community hospitals. Azar promised he would help change existing restrictions but stopped short of saying he would support a full repeal (which would require legislative action).

Problems Plague Obamacare Exchanges

2018 Obamacare Health Insurance Exchanges: Competition and Choice Continue to Shrink
By Ed Haislmaier
The Heritage Foundation, Jan. 25, 2018

Insurer participation and competition in Obamacare declined again in 2018 at both the state and county levels.  In 2018, more than half of all counties had only one insurer offering exchange coverage, up from one third in 2017.  A health insurance monopoly offering overly expensive coverage that pays for only a very limited set of providers is deeply unattractive, especially to customers who previously enjoyed choice in both their insurance and medical care. Consumers are looking to Congress and the President for help in escaping the soaring costs and shrinking choices that characterize the ACA exchanges.

Plans with More Restrictive Networks Comprise 73% of Exchange Market
By Caroline Pearson, Elizabeth Carpenter
Avalere Health, Nov. 30, 2018

Avalere finds that plans with more restrictive networks, including health maintenance organizations and exclusive provider organizations continue to dominate the exchange market with 73% of the 2018 market comprised of restrictive network plans.  That is an increase from 68% in 2017 and 54% in 2015.  Avalere’s analysis also found that deductibles for the most popular type of plan on the exchange—silver plans—will are climbing in 2018 to an average of $3,937, up from $3,703 in 2015, and each following year they will increase.

Health Insurer Centene Is Sued Over Lack of Medical Coverage
By Reed Abelson
The New York Times, Jan. 11, 2018

People who bought policies from health insurer Centene filed a federal lawsuit claiming the company does not provide adequate access to doctors in 15 states. “Members have difficulty finding—and in many cases cannot find—medical providers,” who will accept patients covered under policies sold by Centene, according to the lawsuit filed in federal court in Washington State. “People signed up for insurance and they discovered there were no doctors,” said Seth Lesser, a partner at the law firm of Klafter Olsen & Lesser who is representing some of the policyholders. Centene also is a major supplier of Medicaid managed care plans to states.

Nevada Takes Steps Toward Leaving Federal Healthcare.Gov
Associated Press, Feb. 10, 2018

Nevada is taking steps toward leaving the federal healthcare.gov exchange and setting up a separate exchange operated by the state. The Nevada Appeal reports that the Legislative Interim Finance Committee authorized state officials to spend $1 million to prepare a request for proposals and find a private provider. Officials say changes are needed because healthcare.gov is steadily raising the rates it charges states that link their front-end systems to access the federal exchange. They say the federal rate increases by 2019 will leave the state with almost nothing to run the front-end system.

Private Sector Innovation

Amazon’s Latest Ambition: To Be a Major Hospital Supplier
By Melanie Evans and Laura Stevens
The Wall Street Journal, Feb. 13, 2018

Amazon is looking to become a major supplier to U.S. hospitals and outpatient clinics. The online retailer is pushing hard to expand its foothold in medical supplies, creating a marketplace where hospitals could shop to stock emergency rooms, operating suites and outpatient facilities. The market for medical supplies is one of a growing number of businesses the online retail giant has set in its sights, from groceries to clothing, often with market-moving results.


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