Someone please explain this…

If the medical device tax isn’t repealed, a few dozen Congresspeople are willing to default on our debt, potentially causing international financial turmoil and a major recession.

That’s reality, or at least what passes for reality these days.

Here’s the path we’ve trod to get to this point.

  1. A few dozen Congresspeople refused to pass a budget by October 1 because they wanted PPACA killed.  The Speaker of the House, averse to violating the “Hastert Rule”, went along with their demands.
  2. The Senate refused to comply, and anyway, the President would not have agreed.
  3. As public opinion turned increasingly against the few dozen, and their increasingly untenable position became increasingly obvious they changed their demands, from a delay to:
    • a delay of PPACA implementation, then
    • a repeal of the medical device tax, then
    • a delay of the enrollment mandate, then
    • a demand that Congresspeople and their staffers would have to pay all their premiums themselves; then
    • a delay of the employer reinsurance tax…
    • now PPACA appears to be off the table, and instead there’s a demand for some budget talks around addressing the sequester and long-term entitlement cuts.

Sure, some of these were mixed in together, and others were sorta kinda coupled, but you get the picture.

As some readers have pointed out, the Congresspeople’s actions are, in fact, legal.

They are also mystifying.  Sure, the most vocal come from very safe districts where their actions seem to reflect the current will of their voters, but is delaying the medical device tax really worth defaulting on the national debt – and the all-too-likely consequences of a default?

Medical device tax or… world-wide financial meltdown, immediate return to 2008 recession…

Of course, now that the GOP is on the run and desperate for a deal, any deal that allows them to declare victory (maybe changing PPACA’s health plan colors from bronze silver and gold to red, white, and blue?), Senate Majority Leader Reid is playing his own brinksmanship game, demanding a roll-back of the sequester.

The GOP won’t agree to that, so we’ll likely get just what we would have had if this whole stupid pointless embarrassing mess hadn’t even happened – a short-term deal late on October 16 (that’s tomorrow!) with some nice words about negotiations over long-term entitlement reform and revenue generation.

What does this mean for you?

Elections have consequences.


Status report: Obamacare implementation

Here’s where things are.

Briefly, my best guess is less than a hundred thousand folks have enrolled in insurance via the Exchanges so far.  That’s based on reports I’ve seen from several sources identified below.

And, there are a lot of health plans participating, with 2/3 of states offering 4 or more health plans, each with multiple benefit plans.

Not surprising, as Massachusetts’ experience with their “exchange’ indicates people accessed their system about 18 times before actually enrolling.

Those shopping for coverage are finding lots of options, as 2/3 of the states have four or more health plans selling thru the Exchanges, while eleven of the most populous states have ten or more plans participating.

Carrier Participation Map - Final

Of course, PPACA implementation started back in 2010, with the elimination of lifetime caps on medical expenses, extension of coverage to dependents up to age 26, increased reimbursement for primary care under Medicare and other interim actions.

What does this mean for you?

Not surprisingly, there’s far more shopping than buying, and a raft of technical and capacity problems on the Exchange servers.  As the tech issues get fixed, we’ll see more traffic and more enrollees, especially in late November.

Until then this will quickly become yesterday’s news.


Exchanges open tomorrow – what does this mean?

Come hell or high water – or even a government shutdown, the Exchanges are going to open tomorrow.  Here’s what it means.

  • Some will not be “fully operational” – Spanish language options won’t be on-line in Nevada for some weeks; Medicaid and subsidy eligibility can only be accessed via phone in some states; small businesses can’t buy coverage till November.
  • Estimates are that only about 7 percent of the population will obtain coverage thru the Exchanges – or about 23 million people.  The rest will be covered via Medicare, Medicaid, and employer plans, and other means.
  • The open enrollment period is six months; don’t expect all 23 million to sign up tomorrow, or even this time around.  This is especially true as enrollees have to pay their first month’s premium within 30 days of enrollment; I wouldn’t expect a lot of folks to sign up tomorrow and pay a month’s premium on coverage that won’t kick in for 90 days.
  • Coverage begins January 1, 2014.
  • By the end of the initial enrollment period an estimated 7 million will haver purchased coverage thru the Exchanges.


Limited provider networks…that’s the point, folks!

There’s a good bit of hand-wringing and wailing by physicians and their support groups over healthplans limiting their networks to relatively small subsets of the entire provider community.

As if this was somehow a bad thing.

Health plans are contracting with smaller groups of providers to

  • a) drive more patient volume to those providers in return for
  • b) better financial terms and
  • c) tighter integration between the healthplan and the selected providers.

I find it darkly funny that the AMA and other groups are moaning about the potential impact on patient access to health care of these smaller networks; one of the primary reasons many don’t have health care is because physician services COST SO MUCH.

Instead of whining about the injustice of it all, the AMA – and the provider groups who aren’t part of the smaller networks – could decide to, oh, I dunno, maybe reduce their fees, agree to strict evidence-based medical guidelines, implement system-wide electronic health records and EDI for billing and encounter data…

After all, I’m quite sure the health plans with small network options would love to have bigger networks – but only if the cost of care makes the health plans’ product offerings cost-competitive.

It would be easy to miss the real significance of this tempest-in-a-teapot, and that would be this – By leveling the playing field, ACA and the Exchanges enable consumers to quickly and efficiently compare health plan offerings.

THE key decision criterion is price.

These health plans understand it, have gotten some providers to agree to help them reduce their “cost of goods sold”, and therefore are going to win more business.

Big networks work when HR people are the buyers; they don’t want to hear from employees and spouses complaining that their pediatrician or ob/gyn or cardiologist is not in-network.  When consumers and small business people are doing the buying, they are much less likely to be concerned about every Dr Tom, Dr Dick, and Dr Mary being in-network; they are choosing between a plan they can afford and one they can’t.

What does this mean for you?

You can have a huge network or a reasonably priced health plan, but you can’t have both.


Implementing health reform, random report 1

Today brings another in our random reports on progress and stumbles in implementing reform, starting and running Exchanges, and sussing out the reality from the BS.

It looks like there will be more competition for individual insurance come 2014 than there is in today’s market – “the number of carriers offering non-group insurance plans [in the 10 states where data is available] will increase substantially, from 52 to 70–an increase of 35 percent. Six of the 10 states will see more insurers operating on the non-group exchange compared to the number of significant competitors pre-reform.” Four will see no change.

One example is Colorado, where there are 243 individual and group plans available come October.  Rates are in, and while they aren’t lower than current rates, the additional benefits and (in some cases MUCH) lower out-of-pocket maximums make for much better coverage.  Individual rates for lower-end plans range from around $200 for young’uns to $250 or so for 40 year olds, and that’s BEFORE any subsidy, which about 466 thousand Coloradans qualify for.  The folks who know waaaaay more than I do about Colorado health plans are Louise and Jay; they’ve done quite a bit of research into costs, benefits, and the balance between the two.

Louise notes that the demise of medical underwriting makes it impossible for insurers to keep individual insurance rates much below small group premiums; on the other hand, many more individuals will be able to get coverage who can’t today.  And, those unfortunates who are stuck in one job because they need the insurance will be able to move, start a new job, or a new business after 1/1/14.

Gotta love that free market!

Moving a thousand miles plus to the east, data on insurance premiums from the D.C. Exchange are in; rates for the four insurers filing to date are “in line with current rates”; a bronze plan for youngsters can be had for $124, the older folks can get one for $296 on the individual market, with group rates somewhat higher.

Finally, there is growing evidence that the ACOs working in Medicare are beginning to have a measurable impact on outcomes; readmissions fell by one percentage point last year, the first drop in five years. Anecdotally, some hospitals participating in ACOs are reporting decreases in ER visits for Medicare recipients enrolled in ACOs.