Association Health Plans for Small Groups and Self-Employed Individuals Could Be Negatively Impacted under the Better Care Reconciliation Act


The Senate Better Care Reconciliation Act (BCRA), a proposal to repeal and replace the Affordable Care Act (ACA), includes a provision to create new association health plan options for small employers and self-employed individuals.  These so-called “small business health plans” (SBHPs) would be considered part of the large group market, which has different rules than the small group market.  In particular, the ACA requirement that premiums cannot vary based on health status does not apply in the large group market.  Neither does the requirement for policies to cover ten categories of essential health benefits.  If enacted, this provision would considerably disrupt the small group market because small employers could seek lower rates or less comprehensive coverage in an SBHP when their employees are healthy, but theoretically move back to regular small group market plans if an employee becomes ill or if the group wants more comprehensive benefits.  This type of adverse selection could result in significant premium increases and instability in the small group market.  The provision could disrupt the non-group market in a similar manner because it would permit self-employed individuals (in states that choose to regulate very small groups of one as small employers) to join SBHPs when they are healthy or want few benefits, but move back to regular non-group coverage if their health or circumstances change.


Under the BCRA, new association health plan options would be available to small employers and to the self-employed in certain states.  The bill amends the federal Employee Retirement Income Security Act of 1974 (ERISA) to establish the following rules, standards, and definitions for small business health plans:

Large group market rules apply.  A SBHP is defined as a fully insured group health plan, sponsored by a certified entity, and offered by a health insurer in the large group market.  Several key requirements for small group market insurers do not apply in the large group market.  Insurers in the small group market cannot consider the health or claims of a small group’s employees, and must cover the 10 categories of essential health benefits (though states could waive that requirement under the BCRA).  These rules do not apply in the large group market.  The BCRA sets no standards for SBHPs in terms of what benefits must be covered or how premiums would be set for small firms that want to participate.  For example, the insurer covering the SBHP could medically screen small firms applying, and charge relatively low rates for healthy groups but very high rates for groups with sick employees.  In addition, the insurer could consider a group’s health and claims at renewal and give them considerably higher rate increases than other groups.  The same practices could apply to self-employed individuals.  Small businesses could join and enroll in SBHPs, as could self-employed individuals with no other participating employees (i.e., groups of one) in states that choose to regulate such arrangements as small group health insurance.

Federally regulated.  The sponsor of a SBHP must be certified by the Secretary of Labor.  Federal certification is deemed approved after 90 days unless the Secretary denies the application for cause.  To do business in a state, a certified SBHP must provide written notice of its certification to the insurance regulator in every state in which it will operate.  The federal government also has enforcement authority over the business practices of SBHPs.  The bill includes broad preemption language stating that federal standards “shall supersede any and all State laws insofar as they may now or hereafter preclude a health insurance issuer from offering health insurance coverage in connection with a [certified] small business health plan.”  This appears to prohibit a state from requiring that a SBHP be regulated as small group coverage and may preempt other state insurance rules, as well.  The Secretary is required to coordinate with the State in which a particular SBHP is domiciled regarding the exercise of federal authority to certify a SBHP and enforce federal standards.  The Secretary is also required to ensure that only one domicile state will be recognized with respect to any particular SBHP. The bill does not provide that the rules of the domicile state will supersede the laws of other states.

Nondiscrimination standards.  The entity that sponsors a SBHP must be organized for a purpose other than providing health benefits, although it appears that providing health benefits could be the primary purpose of the organization.  For example, a sponsoring entity could be a bona fide trade association, organized primarily for professional or industry-related purposes.  Or it could adopt broadly inclusive membership standards to permit virtually any small group or individual to join.  In addition, the sponsor of the SBHP is prohibited from conditioning membership on the size of its member groups.  The bill does not prohibit a sponsoring entity from conditioning membership on the health status of small businesses; a nondiscrimination provision in the bill states that a requirement not to discriminate against employers and eligible employees is satisfied if the SBHP makes information about all coverage options readily available to any eligible small employer.

Under the BCRA, the SBHP provisions become effective 1 year after the date of enactment and the Secretary of Labor is required to issue implementing regulations no later than 6 months after the date of enactment.

Effects on Small Employers, Self-Employed Persons, and Traditional Markets

The establishment of small business health plans could affect the way health insurance operates for small employers, and could affect the entire small group health insurance market, in several ways:

Premium instability for small businesses and self-employed individuals – Because SBHPs would be able to set premiums for small firm and self-employed members  based on health and risk status, it could be possible for SBHP members to obtain lower premiums for coverage as long as their workers and their family members are healthy.  However, in the event a covered individual becomes seriously ill or injured, nothing under federal law would prevent the SBHP insurer from raising the premium for that small employer or self-employed individual, even to unaffordable levels.  The affected small employer or self-employed person might then try to seek coverage in the traditional small group market or non-group market, where health status rating is prohibited, though as discussed below, premiums there could also become unaffordable.

Increased premiums in traditional small group and non-group markets – Selection of coverage options, based on which market rules are most advantageous at the time, is sometimes called adverse selection.  The asymmetry of rules applied to SBHPs and the traditional small group market would tend to segment small employers based on risk, steering more expensive groups to the traditional market and driving up community rated premiums.  This could lead to premiums in the traditional small group market becoming much higher for employers who need to seek coverage there.  Eventually, the impact of selection could force insurers to stop offering traditional small group coverage because they could not predict the risk of potential enrollees.  The SBHPs would also be open to self-employed individuals in states that permit very small groups of one to buy small group coverage, as 14 states did prior to the ACA.  In 2014, one in five marketplace consumers was a small business owner or self-employed.  As a result, adverse selection from SBHPs could also affect premiums in the individual market.

Lack of clear regulatory authority – The BCRA requires that SBHPs must be fully insured group health plans, suggesting that states would continue to have regulatory authority over the insurance product itself, for example, to apply and enforce state standards related to risk based capital and solvency.  However, preemption language in the bill is broad, and does not specify which state laws could still be enforced, including for example, laws relating to qualifications of SBHP sponsoring entities, or the covered benefits or rating practices under such plans.  At a minimum, it seems legal challenges could arise if states would try to regulate SBHPs more closely.  In the past, in response to federal proposals to create new small group insurance arrangements that would not be subject to all state small group market regulation, the National Association of Insurance Commissioners, the American Academy of Actuaries, and others have raised concerns that market fragmentation and harm to small businesses and consumers could result.


The Senate SBHP proposal sets up competing and unequal regulatory regimes for small group health insurance that could undermine the traditional market.  It also would potentially increase non-group premiums because healthy self-employed people could leave that market while people with health problems would not qualify for SBHP rates.  In addition, small groups and the self-employed could choose less comprehensive policies while they are healthy, but move to more comprehensive plans if their health changed (if they remain available).  Such adverse selection could drive up the cost of coverage in these markets, making health insurance less affordable for sick individuals and small groups who would have to rely on them, and potentially not available at all.

Posted in Better Care Reconciliation Act, Health Care, Medicaid, Pre-existing Conditions, Trump, trumpcare | Leave a comment

Uneven Playing Field: Applying Different Rules to Competing Health Plans


As the Senate considers the Better Care Reconciliation Act (BCRA), a proposal to repeal and replace the Affordable Care Act (ACA), amendments have been discussed to further change private health insurance market rules that apply under current law.  Under the BCRA, current law health insurance market rules would still apply: Insurers in the non-group health insurance market are prohibited from turning applicants down or charging higher premiums based on health status and from excluding coverage for pre-existing conditions.  In addition, all policies must provide major medical coverage for 10 categories of essential health benefits and must limit the annual out-of-pocket cost sharing (deductibles, co-pays and coinsurance) that people must pay for covered services in network (although states can alter those requirements through waivers).

However, an amendment to the BCRA, suggested by Senator Ted Cruz (R-TX), reportedly would allow insurers in the non-group market to also sell some policies that would not be required to follow all of the ACA market rules.  For example, such policies might not have to follow ACA essential health benefit and cost sharing standards.  In addition, some reports suggest that insurers would not have to sell these policies to people with health conditions or risks and could vary premiums for them based on the health of applicants.

This brief examines the likely impact of such a change on the stability of coverage offered through non-group markets and on the number of individuals who might be affected.

Impact on Consumers Ineligible for Premium Subsidies

If the BCRA were amended to permit insurers to sell ACA-compliant plans alongside plans that did not follow ACA-benefit standards and/or rating and access rules, the likely result would be that the cost of ACA-compliant plans would skyrocket.  The ACA-compliant plans would effectively become a high-risk pool, attracting enrollees when they need costly health benefits – such as maternity care, or drugs to treat cancer or HIV, or therapies to treat mental health and substance abuse disorders – and those with pre-existing conditions who are turned down by non-compliant plans or charged high premiums based on their health.  By contrast, non-compliant plans would attract healthier consumers, at least as long as they didn’t need coverage for such benefits.  Premiums from the healthier enrollees would not be pooled to help keep the price of compliant plans affordable. As a result, premiums for compliant plans would increase significantly, while premiums for non-compliant plans would be substantially lower (though they would also cover fewer benefits).

The Senate BCRA would continue ACA-like premium tax credits to subsidize the cost of coverage for low-and middle-income individuals. Like the ACA, premium tax credits under the BCRA would be tied to the cost of a benchmark marketplace plan, though the benchmark would have higher patient cost-sharing than under the ACA. Eligibility for premium tax credits would be capped at income of 350% of the federal poverty level (FPL), compared to 400% FPL under current law.  Individuals eligible for tax credits would be required to pay a set percentage of their annual income toward a benchmark plan; the premium tax credit amount for each individual would be the difference between the actual cost of the benchmark plan and a person’s required contribution.  Under this formula, as under current law, subsidy-eligible people would generally be shielded from annual premium cost increases, which would instead be absorbed by federal premium tax credits.

While people with pre-existing conditions eligible for premium tax credits would be cushioned from premium increases in compliant plans under the Cruz amendment, those ineligible for credits would not be protected.

According to the National Health Interview Survey, approximately 40% of non-group market participants in 2015, or 6.1 million people, had income above 350% FPL.  Most of these individuals purchased non-group coverage outside of the marketplace. Under the BCRA, these individuals would not be eligible for premium tax credits.

We further estimate that, among the 6.1 million non-group market participants with incomes of at least 350% FPL, 24% (or about 1.5 million) would have pre-existing conditions that would have been considered automatically deniable by insurers prior to the ACA.  These conditions include cancer, diabetes, HIV/AIDS, hepatitis, substance use disorders (including opioid addiction), serious mental illnesses, and pregnancy. (Figure 1)

For these 1.5 million individuals, non-compliant plans would likely either deny coverage outright or charge very high premiums tied to their health. Even if they could obtain coverage in non-compliant plans, it might not cover key benefits, such as maternity care, mental health care, substance use treatment, or prescription drugs, and would not solve the affordability problem.

Among the three-quarters of other market participants with income over 350% FPL, millions would have other types of pre-existing conditions that were not considered automatically declinable prior to ACA, such as high-blood pressure, high cholesterol, asthma, and depression.  Many in this group also could see a substantial increase in out-of-pocket spending for medical care that would offset any premium savings associated with less comprehensive policies.


To calculate nationwide prevalence rates of declinable health conditions, we reviewed the survey responses of nonelderly adults for all question items shown in Methods Table 1 using the CDC’s 2015 National Health Interview Survey (NHIS).  Approximately 27% of 18-64 year olds, or 52 million nonelderly adults, reported having at least one of these declinable conditions in response to the 2015 survey.  For more details on methods and a list of declinable conditions included in this analysis, see our earlier brief: Pre-existing Conditions and Medical Underwriting in the Individual Insurance Market Prior to the ACA.

The programming code, written using the statistical computing package R, is available upon request for people interested in replicating this approach for their own analysis.

Posted in AHCA, Better Care Reconciliation Act, Health Care, Medicaid, Pre-existing Conditions, Trump, trumpcare | Tagged | Leave a comment

New details emerge on Moscow real estate deal that led to the Trump-Kremlin alliance

Remember when Trump disavowed any business dealings with anyone in Russia?  Someone found a thread to pull…

Michael Isikoff

Chief Investigative Correspondent
Yahoo NewsJuly 11, 2017

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Donald Trump, Aras Agalarov and Rob Goldstone. (Photos: Sean Gallup/Getty Images; Sergei SavostyanovTASS via Getty Images; Adriel Reboh/Patrick McMullan via Getty Images

While in Moscow for the Miss Universe pageant in November 2013, Donald Trump entered into a formal business deal with Aras Agalarov, a Russian oligarch close to Vladimir Putin, to construct a Trump Tower in the Russian capital. He later assigned his son, Donald Trump Jr., to oversee the project, according to Rob Goldstone, the British publicist who arranged the controversial 2016 meeting between the younger Trump and a Kremlin-linked lawyer.

Trump has dismissed the idea he had any business deals in Russia, saying at one point last October, “I have nothing to do with Russia.”

But Goldstone’s account, provided in an extensive interview in March in New York, offers new details of the proposed Trump project that appears to have been further along than most previous reports have suggested, and even included a trip by Ivanka Trump to Moscow to identify potential sites.

According to the publicist, the project — structured as a licensing deal in which Agalarov would build the tower with Trump’s name on it — was only abandoned after the Russian economy floundered. The economic downturn resulted in part from sanctions imposed by the U.S. and the European Union following Russia’s intervention in Ukraine.

Goldstone’s version of events implies a possible explanation for Trump’s interest in lifting sanctions on Russia — a policy move his administration quietly pursued in its first few weeks until it ran into strong opposition from members of Congress and officials within the State Department.

Goldstone placed Donald Trump Jr. at the center of the Trump Tower deal, saying that his father assigned his eldest son the job of moving the project to fruition after the signing of a “letter of intent” between the Trump Organization and Agalarov’s company, the Crocus Group. It is not clear if the future president personally signed the “letter of intent,” but Michael Cohen, a longtime lawyer for Trump, told Yahoo News Tuesday that it would have been standard practice for Trump, as president of the Trump Organization, to do so.

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Donald Trump Jr. at the Republican National Convention in Cleveland, July 18, 2016. (Photo: Jonathan Ernst/Reuters

Goldstone also said that Ivanka Trump flew to Moscow in 2014 and met with Emin Agalarov, the oligarch’s son, a pop singer and a vice president of the Crocus Group, to identify sites for the project.

Trump “put Donald Jr. in charge and then Ivanka went to Moscow to look around for what the location would be,” Goldstone said. But the plans for a Trump Tower fell apart because “the economy tanked in Russia’’ after the imposition of Western sanctions, he said.

Goldstone, a British-born publicist who once did worked for Michael Jackson, represents Emin Agalarov in his music career and was present in Moscow during the Miss Universe pageant when the Trump Tower project was discussed by Trump and Aras Agalarov. His role has gotten new attention this week after the New York Times disclosed that Goldstone emailed Donald Trump Jr. in June 2016 urging him to meet with a Russian lawyer to receive damaging information from the Russian government about Hillary Clinton.

Trump Jr. released his email exchange with Goldstone on Tuesday, confirming the key role of the publicist and, more significantly, the Agalarovs, in offering negative information about Clinton on behalf of the Kremlin. “Emin just called and asked me to contact you with something very interesting,” Goldstone wrote Trump Jr. on June 3, 2016.

A chief prosecutor in Russia “offered to provide the Trump campaign some official documents and information that would incriminate Hillary and would be very useful to your father. This is very high-level and sensitive information but is part of Russia and its government’s support of Mr. Trump — helped along by Aras and Emin.”

Alan Garten, the chief lawyer for the Trump Organization, did not respond to requests for comment. In a telephone interview, Cohen, who is Trump’s personal lawyer, did not dispute any specific details of Goldstone’s account but offered to check them. He did not later respond. But Cohen adamantly rejected the idea there was anything improper about meeting with the Russian lawyer, Natalia Veselnitskaya, given that Trump Jr. was told she might have information helpful to Trump’s campaign. “The purpose of the election is to win,” said Cohen, adding, “Why is this any different?” than the unverified “dossier” on Trump’s ties to Russia prepared by a former British spy working for a Washington research firm hired by his political opponents.

Trump Jr., accompanied by then campaign manager Paul Manafort and senior adviser Jared Kushner, met with the Russian lawyer at Goldstone’s request to review the information she purported to have. “He met with her face-to-face to determine” the validity of the advertised documents and “no information was provided.”

Goldstone had played a key role in helping to broker the initial decision by the Miss Universe pageant — then owned by the Trump Organization and NBC — to hold its 2013 contest in Moscow.

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According to Goldstone, he pitched the idea to Paula Schugart, then chief executive of Miss Universe, as a way to promote the music career of Emin Agalarov. Schugart was initially hesitant because of concerns about red tape in Moscow. “What if you had a  partner who owns the biggest venue in Moscow?” Emin Agalarov responded, according to Goldstone’s account. “Between myself and my father, we can cut through the red tape. You have a new partner.”

The plans to bring Miss Universe to Moscow was announced by Trump in Las Vegas in June 2013 during the Miss USA contest. Trump at the time quickly expressed hope that it would lead to a meeting with Putin. “Do you think Putin will be going to the Miss Universe pageant in November in Moscow — if so, will he become my new best friend?” Trump had tweeted at the time.

A meeting with Putin never came off during Trump’s Moscow trip; the Kremlin expressed regret that the Russian president wouldn’t be able to fit it into his schedule on the day in question because he had a meeting with the King of Holland. But the trip gave Trump an opportunity to discuss the plans for the Trump Tower in Moscow with Agalarov, a billionaire who has been called “the Trump of Russia” and “Putin’s builder” because of massive construction projects he has done on behalf of the Kremlin. Just 10 days before the Miss Universe pageant, Putin had given Agalarov a prestigious award at a ceremony at the Kremlin: Order of Honor of the Russian Federation.

In an interview with Forbes this March, Emin Agalarov confirmed the plans for Trump Tower in Moscow. “We thought that building a Trump Tower next to an Agalarov tower — having the two big names — could be a really cool project to execute,” Emin Agalarov told the magazine. Agalarov blamed the abandonment of the project on Trump’s decision to run for president, rather than the imposition of sanctions. “He ran for president, so we dropped the idea,” Agalarov said. “But if he hadn’t run, we would probably be in the construction phase today.”

But Emin Agalarov said he and the now president have continued to stay in touch, saying that Trump sent a handwritten note to the Agalaovs in November after they congratulated him on his victory. “Now that he ran and was elected, he does not forget his friends.”

Posted in Ethics, Trump | Tagged , , , | Leave a comment

Senate’s health care bill will cost New York’s Medicaid program billions

Posted on Politico
Sen. Mitch McConnell is pictured. | Getty
New York was one of only two states to take advantage of the Essential Plan, also known as the Basic Health Plan, a program funded with the Affordable Care Act’s tax credits and cost-sharing subsidies. | Getty

ALBANY — The Senate’s version of the American Health Care Act would cost New York’s Medicaid program billions of dollars over the next decade, putting Albany in the position of having to choose between raising taxes or cutting services and programs for hundreds of thousands.

The bill, which is certain to change before coming to a vote, would also upend New York’s individual health insurance market, likely saddling many with higher deductibles and more expensive premiums.

“The Senate bill presented today, which was crafted behind closed doors by 13 men, would fundamentally harm Americans young and old, do severe damage to a fragile economy, and bankrupt state governments across the country,” Sen. Kirsten Gillibrand said in a statement. “The cuts to Medicaid in particular are galling. … To end the Medicaid expansion created under the Affordable Care Act is a cruel joke.”

The state’s Essential Plan, which enrolls nearly 700,000 New Yorkers in low-cost health insurance plans, likely would not survive in its current form because it relies on federal funding that would disappear. The program provides health insurance for $20 per month to those with incomes between 150 percent and 200 percent of the federal poverty level. Those with incomes below 150 percent of the federal poverty level, who do not qualify for Medicaid, receive health insurance with no premium.

New York was one of only two states to take advantage of the Essential Plan, also known as the Basic Health Plan, a program funded with the Affordable Care Act’s tax credits and cost-sharing subsidies. The cost sharing subsidies disappear in 2020 under the Senate’s version of the bill.

That would, on its own, be enough to severely handicap the Essential Plan but Republicans also propose prohibiting “lawfully present” immigrants from receiving tax credits. In New York, there are a couple of hundred thousand lawfully residing immigrants taking advantage of the Essential Plan. Without their tax credits, the state would have no method for funding their health insurance unless Albany decided to subsidize the insurance without federal help, a multi-billion dollar proposition.

A 2001 state Court of Appeals ruling requires that those residents, known as People Residing Under the Color of Law, receive Medicaid, which the state would once again have to pay for without any help from the federal government. That alone would cost the state $1.19 billion, according to an estimate from the state Department of Health.

On top of that, the Senate bill includes an amendment sponsored by Reps. John Faso and Chris Collins that would effectively prohibit the state from using county taxes to pay for the Medicaid program. That is expected to shift roughly $2.3 billion from county budgets to the state budget, and though it may ease the property tax burden in upstate New York, it will do nothing to ease the budget woes facing Albany in 2019.

The more severe Medicaid cuts would hit between 2020 and 2024, according to the Senate bill, which phases out the enhanced federal match states such as New York received from the federal government because of Obamacare.

In its place, there would be a per-capita cap assigned to each state. The per-capita cap would be based on what a state spent between 2014 and 2017, but high-cost states such as New York would see their per capita reduced by the secretary of Health and Human Services by as much as 2 percent.

Shoppers on the individual insurance market would see the value of their subsidies decrease. The Affordable Care Act pegged subsidies to a silver plan, which has an actuarial value of 70 percent, meaning insurers pay for 70 percent of the costs. The Senate version pegs subsidies to plans with an actuarial value of 58 percent. That will almost certainly mean New Yorkers who rely on subsidies will need to purchase skimpier plans with higher deductibles. Those who wish to buy the equivalent of silver plan will spend more out of their pocket on premiums.

The cutoff for income-based subsidies under the Senate plan is reduced to 350 percent ($42,210 for an individual) of the federal poverty level from 400 percent. Subsidies tied to the federal poverty level always hurt high-cost states such as New York where incomes tend to be higher than average, as does the cost of living. Basically, $43,000 goes a lot further in most other parts of the country so subsidies for health insurance aren’t as needed.

The Senate’s version is also worse for New York hospitals compared to the House version, according to the Greater New York Hospital Association, which pointed out that the House bill repeals the cuts to the Disproportionate Share Hospital program for Medicaid expansion states in 2020. The Senate does not, costing hospitals billions of dollars.

“It’s every bit as bad as the House bill. In some ways, it’s even worse,” Senate Minority Leader Chuck Schumer said Thursday on the floor of the Senate. “The president said the Senate bill needed heart. The way this bill cuts health care is heartless. The president said the House bill was mean. The Senate bill may be meaner.”

The state Department of Health would not provide an estimate of how many people with incomes between 350 and 400 percent of the federal poverty level buy plans on the exchange, although the state does collect income information.

The agency also declined to predict the total cost of the Senate’s bill on New York, or its effects on the Essential Plan, providers or insurers.

Posted in AHCA, American Health Care Act, Better Care Reconciliation Act, Cuomo, GOP, Health Care, Medicaid, Trump, trumpcare | Tagged | 1 Comment

Medicaid Cuts Will Drive Up Cost Of Private Coverage, Montana Insurers Say


From left, Senate Majority Leader Mitch McConnell and Sens. Pat Roberts (R-Kan.) and Steve Daines (R-Mont.) chat before a Republican meeting to discuss the health care bill on June 27. (Nicholas Kamm/AFP/Getty Images)

Montana was among the last states to expand Medicaid, and its Obamacare marketplace has fared reasonably well. It has 50,000 customers, decent competition and no “bare counties,” where no insurers want to sell plans.

The Republicans who make up two-thirds of Montana’s congressional delegation have said they want to repeal the current health care law because it’s causing health insurance markets to “collapse.”

But insurance executives at the companies that sell policies in Montana’s marketplace say that’s not true in the state, and they are concerned that GOP plans to repeal and replace the Affordable Care Act would destabilize a market that is working. Jerry Dworak, the CEO of Montana Health Co-Op, said, “I don’t think that their plan is going to improve health care in the state of Montana. I think just the opposite is going to happen. And I really do think a lot of people are going to get hurt.”

The co-op is one of the three insurance companies that have been selling Montanans coverage at since it started in 2013. Dworak said it has no plans to leave.

The executives say collapse is a real possibility, though, if some of the GOP’s wish list comes true. First, deep cuts to Medicaid would have ripple effects to everybody with insurance. Todd Lovshin, a vice president at PacificSource Health Plans, said Medicaid expansion means Montana hospitals are now getting paid for taking care of more than 70,000 Montanans who got Medicaid after the state expanded it under the Affordable Care Act.

“All of our hospitals have to take any patient that comes in and serve them. That has to be paid somewhere,” he said. “And if we’re not paying that through Medicaid expansion, those costs have to be borne by someone, and so that will increase the overall cost of medical expenses.”

Hospitals have a legal obligation to examine and stabilize any patient who walks in their door, regardless of whether they have insurance. When hospitals see their unpaid bills stack up, Lovshin said, prices go up for everybody else and insurers have to charge patients who have insurance more to stay afloat.

John Doran, a vice president with Blue Cross and Blue Shield of Montana, the state’s biggest insurer, agreed with that analysis.

Doran also said that problems would likely get worse if the individual mandate goes away. That’s the requirement to have health insurance that Republican health care bills do away with.

“If there’s no mandate, and there’s no incentive for them to buy a health insurance plan, then maybe they won’t,” he said. “The people who need health care the most, and typically have the highest health care costs, are the only ones who are in the marketplace, and that results in higher health care costs, and consequently higher premiums.”

Montanans have been seeing insurance premiums go up, sometimes by more than 50 percent a year. Most people who buy on the exchange get subsidies to help defray the cost, and the co-op’s Dworak said he thinks prices are now starting to stabilize. If the health law isn’t changed, he projects his company’s premiums would go up only 5 percent in 2018.

This story is part of a partnership that includes Montana Public Radio, NPR and Kaiser Health News.

Kaiser Health News, a nonprofit health newsroom whose stories appear in news outlets nationwide, is an editorially independent part of the Kaiser Family Foundation.

Posted in AHCA, American Health Care Act, Better Care Reconciliation Act, GOP, Health Care, Medicaid, Trump, trumpcare | 1 Comment

Report: BCRA would mean more than 900K healthcare jobs lost

Dive Brief:

  • The Senate’s Better Care Reconciliation Act (BCRA) would result in 1.45 million fewer jobs by 2026, according to a new report by The Commonwealth Fund. Healthcare would take a hard hit with 919,000 fewer jobs.
  • The Commonwealth Fund predicted an additional 753,000 jobs in 2018, but employment numbers would drop sharply after that. It said every state except Hawaii would have fewer jobs and a weaker economy. States that expanded Medicaid would feel the most pain.
  • The report came out on the same day that the Bureau of Labor Statisticssaid 37,000 healthcare jobs were added in June, up from 20,600 added in May .

Dive Insight:

The Commonwealth Fund said that job losses and lower economic growth would begin in 2020 and deepen in the following years as more people lose health insurance coverage, if the Senate bill were to become law.

The House’s American Health Care Act (AHCA) would cut a similar number of insured Americans, but the BCRA would harm the economy more, according to the report. The Commonwealth Fund estimates the AHCA would result in nearly 1 million lost jobs.

New York, California and Pennsylvania would lose more than 100,000 jobs each. “Twenty-two million Americans will become uninsured under the Better Care Reconciliation Act, and now this research makes it clear that people will also be at risk of losing their jobs and that states’ economies will suffer,” said Sara Collins, vice president for healthcare coverage and access at The Commonwealth Fund.

One reason for the economic problems resulting from the BCRA is the bill’s Medicaid cuts, which would deepen further after 2026. Also, the BCRA’s tax provisions would result in much lower assistance, especially for older Americans, which will result in people not being able to afford high deductibles and result in fewer people enrolling in health plans. Third, the BCRA would reduce the threshold of the medical care deduction from 10% to 7.5%.

Cuts to healthcare jobs would especially harm the economy. Healthcare has been a major driver of job growth in recent years. The Commonwealth Fund predicts healthcare would lose 30,000 jobs in 2018 under the BCRA. Ultimately, 919,000 healthcare jobs would disappear, which is about 1 of every 22 health jobs.

“While our analysis shows other employment sectors grow initially, by 2026 more than half a million jobs are lost in other sectors of the economy, too,” according to The Commonwealth Fund.

Meanwhile, the Bureau of Labor Statistics released the June jobs report Friday, which said there were 37,000 healthcare jobs added in June, with 26,000 in ambulatory care services and 11,700 at hospitals. So far this year, healthcare job growth has slowed. Healthcare has added 24,000 more jobs on average per month so far in 2017 after adding 32,000 on average per month in 2016.

Healthcare has seen some high-profile layoffs in 2017. For instance, NYC Health + Hospitals cut 476 management positions to save $60 million in the next fiscal year after losing $776 million for the first half of 2017 and Brigham and Women’s Hospital offered voluntary buyouts in April to 1,600 workers.

Also, Memorial Hermann, Summa Health and Hallmark Health all recently announced staffing cuts, which they blamed on declining reimbursements, lower admissions and shrinking operating incomes.

The 37,000 new healthcare jobs in June is positive, but the question is whether that trend remain or will growth slip back down to this year’s average.

The Commonwealth Fund’s report will surely get the attention of economics — and senators. Senate leaders are already trying to figure out ways to tweak the BCRA to get enough conservative and moderate support to pass the legislation. Republicans only have a two-vote majority in the Senate and the current bill doesn’t have enough support for passage.

Uncertainty about what bill — if any — will pass is likely a major factor is slowed healthcare job growth. This latest report about jobs losses if the BCRA becomes law will only deepen the opposition against the bill.

Posted in Better Care Reconciliation Act, Employment, Health Care, jobs, Trump, trumpcare | 1 Comment

Republicans are victims of a discredited economic ideology

Posted on
Isabel V. Sawhill Friday, July 7, 2017

Editor’s Note:This article originally appeared in Real Clear Markets on July 7, 2017.


Sometimes people do inhumane things. The Senate health care bill is a case in point. It denies health care to a large group of poor, disabled, and elderly Americans to give a big tax cut to a small group of very wealthy people.But are Senate Republicans evil people? Do they lack a moral compass? I don’t think so. I think they are simply victims of a once-successful but now discredited economic ideology. That ideology says tax cuts for the rich will create jobs for the middle class. It says cutting benefits, including health benefits, for the poor will cause them to work harder and behave more responsibly. Granted there is a grain of truth in these propositions but they have now become a cartoon of their once-legitimate, Chicago-school ancestors.

Republicans have become trapped in their own rhetoric, crafted during years of being in opposition. As Ross Douthat noted in a recent New York Times column, drawing on new analysis in a report by Lee Drutman, that rhetoric is now well to the right of the beliefs held by the broader Republican electorate. Republican leaders have failed to recognize the fact that the economic views of those who voted Republican in 2016 “lean only slightly to the right.” Republicans could have used the Trump election to effect a political realignment—one that would have combined a more moderate set of economic policies than the Republican elite currently supports with a more moderate set of cultural positions than those espoused by leading Democrats.

Republicans have become trapped in their own rhetoric, crafted during years of being in opposition.

Instead, the Republican elites are now out-of-step with their followers and could pay a big political price if they continue down their current path. Where are the new ideas that might free them and us from our current impasse? Are there ideas that might even command some bipartisan support and help to move the country in a more pragmatic and centrist direction?

It’s not as if there aren’t plenty of good ideas to choose from. If the problem is a health care system that costs too much and delivers too little, the solution might be to allow the states to experiment with different ways of delivering care. My colleagues, Alice Rivlin and Stuart Butler, have both written about this option. As Rivlin notes:

“Republicans have historically had faith in state governments’ ability to manage public resources in the interests of their residents; Democrats stressed national standards and wanted Washington in charge. But this line is blurring. Obamacare contained provisions (notably the Section 1332 waiver process) that would allow states increasing latitude in spending their federal money. Governors have often proved more adept at brokering compromises across party lines than deeply polarized Washington.”

If the problem is a tax system that is way too complicated and anti-growth, the solution might be to partially replace the income tax with a value-added tax and/or a carbon tax. Several Republican candidates supported a value-added tax during the 2016 primaries and a number of leading Republicans, including James Baker, George Schultz, and Henry Paulson are now arguing for a carbon tax that would return all of the revenues raised to individuals in the form of a citizen’s dividend.

If the problem is a government that has grown too big, the solution might be to tackle the major drivers of that growth. Those drivers are benefits, especially health benefits, for our rapidly growing senior population, and interest on the debt. The Committee for A Responsible Federal Budgetalong with several distinguished budget commissions (Simpson-Bowles and Domenenci-Rivlin) have long argued for such an approach. But it would not include more tax cuts for the rich.

If the problem is too many Americans who are not working, the solution might be to condition government assistance on work or a willingness to retrain o relocate to where the jobs are. A Brookings-AEI working group on poverty wrestled with the issue and suggested something along these lines. Speaker Paul Ryan has also endorsed this approach at various points in the past.

A two-party system should lead to a competition of ideas. And with one-party now in control of both Congress and the White House, it should be possible to enact new legislation that is consistent with conservative philosophy but not the kind of mean-spirited and tortured bills now on offer. Even better would be reaching out to Democrats to find some common ground. On issues as important as health care and taxes, reforms enacted by only one party are unlikely to be sustainable.

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