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AHC Newsletter | 08-06-2018
August 6, 2018
Vol. 1 Issue 4
A Vision for Reform
Trump’s Health Secretary Is Implementing Bold, Reaganesque Reforms
By Robert E. Moffitt, PhD
The Heritage Foundation, Aug. 2, 2018Secretary of Health and Human Services Alex Azar recently outlined an ambitious health care policy agenda in the spirit of the late President Ronald Reagan. In an address at Heritage, Azar emphasized that the Trump administration’s major health care policy initiatives would rely heavily on harnessing the creative powers of federalism and reaffirming state innovation. He emphasized the central role of free-market principles of choice and competition and a commitment to practical problem-solving with a clear-eyed grasp of political and economic conditions.Azar focused on the multiple complexities of prescription drug pricing, bridging the gap between spending and the value of medical goods and services, and the urgent need to repair the nation’s severely damaged health insurance markets.
By Michael F. Cannon Washington Examiner, Aug. 1, 2018At long last, the Trump administration has created a “freedom option” for people suffering under Obamacare. A final rulemaking issued last Wednesday reverses an Obama-era regulation that exposed the sick to medical underwriting. The new rule will expand consumer protections for the sick, cover up to two million uninsured people, reduce premiums for millions more, protect conscience rights, and make Obamacare’s costs more transparent. And unlike President Obama’s implementation of his signature health care legislation, it works within the confines of the law.
Short-Term ObamaCare Relief
By Editorial Board The Wall Street Journal, Aug. 1, 2018Democrats are making an election issue of rising health care costs, so it’s strange that they are now criticizing a new Trump Administration rule that would make cheaper insurance available to more Americans. Maybe they fear people will like it. Health and Human Services last Wednesday finished a rule to expand short-term, limited-duration health insurance. This product has been around for decades for people between jobs or otherwise in need of coverage against the risk of a catastrophic events. The plans must comply with state laws but aren’t subject to ObamaCare rules on benefits or pricing.
A new study by the Center for American Progress argues that Congress’ repeal of the individual mandate and a Trump administration rule that would expand the sale and renewal of short-term policies will have a devastating effect on 2019 premiums.But a comparison of the CAP “sabotage” estimates with preliminary 2019 rate filings in cities in 17 states compiled by the Kaiser Family Foundation suggests CAP vastly overestimated the effects of these policy changes on premiums.
The idea of “Medicare for All” has energized progressives ahead of November’s midterm elections. Across the country, candidates like New York congressional hopeful Alexandria Ocasio-Cortez have rallied to the slogan. Vermont Sen. Bernie Sanders introduced the Medicare for All Act last year and has so far rounded up 16 co-sponsors. Last month, 70 House members formed a Medicare for All Caucus. But there is an enormous gulf between the appealing idea of Medicare for All and the incredibly expensive reality. Paying for every American’s health care expenses would increase federal spending by $32.6 trillionover the first decade of Medicare for All. Even if Congress were to double what it collects in individual and corporate income taxes, there still wouldn’t be enough money added to the federal coffers to finance the costs of this plan.
Maryland is now the fourth U.S. state in recent years to contemplate a “single payer” government health plan. In California, the cost of creating a single-payer system was an enormous political obstacle. Even the politically Left publication Mother Jonesnoted in 2017: The new system would cost a lot of money. The Senate committee in charge of the bill calculated that Healthy California would cost the state $400 billion per year. For context, that’s more than double the state’s current budget. What can we learn from these examples? 1) Opposition to “single payer” plans has come from Democrats as well as Republicans; 2) Most of current opposition is based on economic—not moral—grounds; 3) Proponents of free-market health reforms will need to persuade voters based on moral grounds, not just economic reasons; and4) This issue will heat up in the 2018 and 2020 election cycles.
CMS has approved Wisconsin’s plan to launch a state reinsurance program from 2019 to 2023 to help reduce individual state premiums and control the growth of state healthcare spending. The program, called the Wisconsin Healthcare Stability Plan (WIHSP), is expected to lower individual premium rates by 3.5% in 2019, according to Gov. Scott Walker. Without WIHSP, premiums would be likely to rise significantly in the upcoming plan year.
The Trump administration on Monday approved a request from Maine to set up a program to help moderate rising health insurance costs.CMS said on Monday in a letter to the state that it will approve a reinsurance program from January 2019 to Dec. 31, 2023.Wisconsin and Maine are the fifth and sixth states to get reinsurance approvals. The other states to get approval are Minnesota, Alaska, Oregon, and Hawaii, according to data from the National Conference of State Legislatures.
Congress in 2014 ordered the Centers for Medicare and Medicaid Services to develop a new payment system for the more than 400 million clinical laboratory tests that Medicare pays for each year so that prices would be more closely aligned with those paid by private insurers. But the new payment system is based on data that are not broadly representative of market rates, putting access to clinical services for many seniors in jeopardy. Seniors who live in rural areas and those in nursing home facilities are among those most at risk. This new paper provides background about the issue and about decisions made by the previous administration to collect pricing data that does not reflect the actual market composition of the clinical lab industry. The issue and paper are summarized herein a Forbes post.