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Here Are The Fixes Needed For The ACA

Category: Health Care
Posted: 07/04/17 01:31, Edited: 07/04/17 01:38

by Dave Mindeman

The actual fix for Obamacare is single payer. But barring that, there are ways it can be fixed to make everything work in an orderly manner. The Washington Post outlined 9 things to do that would allow this law to work.

I disagree with a few points about those fixes, but for the most part they have a bipartisan feel that make real sense.

Let's go over this in more detail:

1. The Republicans were right that a 3-to-1 ratio -- heavily lobbied for by the Democrats' friends at AARP -- between the rates charged for older people and those for the youngest adults does not match the relative actuarial costs of insuring the two groups and discourages the young from enrolling. The ratio should be moved to 5 to 1, as was originally contemplated by those drafting Obamacare until AARP got to them.

Democrats were reluctant to go with that 3-1 ration in the beginning and AARP did lobby for the change. But it wasn't a precursor to some death spiral as the Republicans would have you believe. The ACA had other compensations to account for that - which the Republicans managed to wipe out with legislative attachments. Bottom line is that this initial fix MUST be married to Item 2.

2. However, much more generous subsidies should then be given to older Americans to make insurance more affordable to them.

It is critical to compensate the higher ratios with increased subsidies for this age group. Another action would be to lower the Medicare age to 55 - but since that is probably not going to happen with a GOP majority, the subsidies are essential to making the 5-1 ratio work for affordability.

3. Those increased subsidies could be paid for by new controls on the price of prescription drugs, either by allowing Medicare to negotiate prices or by other mechanisms used by every other developed country, where prices are 30 to 60 percent lower than here. Taking just 15 percent off the price of prescription drugs would produce more than $600 billion in health-care savings over the next decade, which would lower private premiums while saving taxpayers billions on Medicare costs.

You probably have heard this before. From every Democrat in the House and Senate, (except maybe Corey Booker). But any attempts to rein in these costs is blocked by GOP legislators bought by Pharma. Using item 3 to pay for the increased ratios in Item 1 is a natural - because Seniors are the main consumers of prescription drugs. Are we getting the picture?

4. As an additional lure to get younger, healthier people into the insurance pool, insurance companies should be allowed to offer them an introductory 50 percent off for their first year of coverage.

Since Republicans find the insurance mandate so abhorrent, this is a logical compromise...and one they should think about. It still will not lead to 100% national coverage, but younger people have to be incentivized to participate in the health care system. Additional incentives would be welcome as well.

5. Five percent of Obamacare's 2.3 percent excise tax on medical devices (which was suspended in 2015 and should be reinstated) should be used for a massive marketing program aimed at enticing younger people into the pool. The ad campaign should also tout the mandate to buy insurance (which must be kept) as, in the Heritage Foundation's words, a matter of "individual responsibility." The more young people who enroll, the lower the premiums will be for everyone.

Those of you who read this blog know that I have complained about Paulsen and his crusade to rid us of the medical device tax are probably familiar with my complaints about this suspension. Medical Device companies are getting more than a 2.3% increase in business from the ACA - but they seek the extra profit - even after abandoning the US to merge with an Irish company to get lower tax rates anyway. It is shameful and the other taxes the GOP want to abandon for gutting Medicaid is doubly shameful. Notice the word "reinstated" applied to both the excise tax AND the mandate.

6. Medicare should finally be allowed to fully implement competitive bidding for medical equipment and devices. Believe it or not, Congress has restricted Medicare's ability even to negotiate the price of diabetes test strips to selected "pilot project" regions. Competitive bidding could save the government at least $50 billion over the next decade, which could be used to increase premium support for older Obamacare enrollees.

This is another pet peeve of mine. Diabetics have been made to suffer even more with Republican changes to health care. Diabetic test strips are a profit dream for manufacturers. It is obvious that these strips can be made very cheaply because when generic strips are allowed on the market they are 50-75% less in cost to the consumer. I am sure every diabetic has noticed the price of insulin skyrocketing. Again, it is not necessary for this to be endured. Negotiating insulin prices with Medicare and Medicaid would fix this in a hurry....because they are the main carrier of record for a large portion of Type II diabetics. This goes double for injectable devices.

7. Antitrust reform needs to be part of the new package, too. Hospitals are merging with abandon. Every study says that although they say they are doing it to save money by consolidating services, prices always go up instead. How are insurers supposed to keep premiums under control if they can negotiate with only one hospital system that controls all the area's hospital beds and most of the doctors and clinics?

I disagree with this one somewhat. Hospitals are merging because they are forced to...and I doubt that anti-trust laws will apply to them because the services they provide are so vital and merging groups especially in rural areas is a survival mechanism - not a price fixing method. The escalating costs are coming from the suppliers - not the hospitals. Still in large urban areas - some mergers should be scrutinized for competitive reasons.

8. The experiments in bundled payments (as opposed to paying for every episode of care) for knee and hip replacements or cardiac surgery, which Health and Human Services Secretary Tom Price has sharply curtailed, need to be restored and intensified.

Yes, this needs to be implemented again, but it also needs to be watched carefully. Too often, in health care, combinations that supposedly promote efficiency never lead to lower costs. So, we need to see what works and what really doesn't.

9. Finally, tort reform should be included. Abuse of malpractice suits is not as costly as Republicans claim, but it is a real issue because it provides a reason -- and an excuse -- for hospitals to over-treat and over-test. If tort reform shaved just half of one percent off of health-care costs, that would yield close to $200 billion over a decade. Democrats need to stand up to their trial lawyer patrons on this one.

Here again, I have serious disagreements with this change. I would contend that the legal malpractice industry may be over done, but it also leads to serious changes in safety standards for the better. And I also question whether extra tests are wasteful. In too many cases, it is really necessary as best practices to protect patients. Medical information is vital in diagnosing and treating patients....and additional tests may be the only way to find a mysterious illness cause. Some tort reform would be OK - but if it is just a GOP method of punishing trial lawyers for supporting Democrats; well, that is a different story and more of the real reason.

I would add one additional item. We need to restore the risk pool that allowed insurance carriers to have a back up when a patient pool would get out of balance.

And of course, my mantra of a public option would stabilize everything in a hurry. But you have heard that before.

Yes, Obamacare can be fixed. The above 9 changes are a big part of making it all work again. But as is becoming evident, the GOP sees too much of a tax cut opportunity to actually think about fixes.

They want the ACA to fail. And that is the simple truth.
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About That Gap In Coverage

Category: Health Care
Posted: 05/19/17 10:48

by Dave Mindeman

As the GOP publicly defends the GOP Congress version of health care, the biggest item to keep in mind is their "promise" to maintain the mandate about pre-existing conditions.

The Kaiser Foundation examined this concept and stated publicly that this is what we face:

Using the most recent National Health Interview Survey (NHIS), we estimate that 27.4 million non-elderly adults nationally had a gap in coverage of at least several months in 2015. This includes 6.3 million people (or 23% of everyone with at least a several-month gap) who have a pre-existing condition that would have led to a denial of insurance in the pre-ACA individual market and would lead to a substantial premium surcharge under AHCA community rating waiver."

The reason the "gap" in coverage is important is that under a law that Ted Kennedy passed years ago, if a person has had continuous coverage under some form of insurance, they cannot be denied coverage, or have surcharges, via an insurer. In the AHCA bill, an opt out by a state can grant the insurers an option of significant surcharges for pre-existing conditions, making the coverage completely unaffordable.

We all know how life intervenes. People get laid off. Bills get overwhelming and health premiums get lower priority. Jobs change and coverages change. Coverage gaps happen. It is a fact of life and people in lower wage jobs are the first victims.

The ACA (Obamacare) understood this and ended the issue of pre-existing conditions. With the Republican bill, it is has been brought back for the sake of insurance profitability.

No matter how Jason Lewis and his cohorts try to spin this, the loop hole is there. And it was placed there intentionally so that insurers can find ways to opt out of coverage for the people with the most need.

It is cynical politics and we have to keep fighting this.
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Pre-Existing Conditions

Category: Health Care
Posted: 05/05/17 18:46, Edited: 05/05/17 18:47

by Dave Mindeman

Here is another thing to consider as the AHCA GOP bill further weakens the protections on pre-existing conditions.

In the future you will probably find that health insurance companies will require you to take a DNA chromosome test. This will go onto your medical file and held confidential like all of your medical records.

But let's say that later on in life, you contract a debilitating illness. And let's also stipulate that it has genetic marker components.

Before you get your treatment covered, the health insurance company will point out that your chromosome test had a genetic marker that predicted a high probability that the disease you have was "always there".

Coverage denied.

Due to a pre-existing condition.

Does the AHCA protect you from that, should a state request a waiver?

No.

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