Monthly Archives

September 2016

Obama administration may use obscure fund to pay Billions to ACA insurers

By | Health Reform

The Obama administration is maneuvering to pay health insurers billions of dollars the government owes under the

Andy Slavitt, acting administrator of the Centers for Medicare and Medicaid Services, calls the ACA money owed insurers “an obligation of the federal government.”

Andy Slavitt, acting administrator of the Centers for Medicare and Medicaid Services, calls the ACA money owed insurers “an obligation of the federal government.”

Affordable Care Act, through a move that could circumvent Congress and help shore up the president’s signature legislative achievement before he leaves office.

Justice Department officials have privately told several health plans suing over the unpaid money that they are eager to negotiate a broad settlement, which could end up offering payments to about 175 health plans selling coverage on ACA marketplaces, according to insurance executives and lawyers familiar with the talks.

The payments most likely would draw from an obscure Treasury Department fund intended to cover federal legal claims, the executives and lawyers said. This approach would get around a recent congressional ban on the use of Health and Human Services money to pay the insurers.

The start of negotiations came amid an exodus of health plans from the insurance exchanges that are at the heart of the law. More than 10 million Americans have gained coverage through the marketplaces since they opened in 2014.

But many insurers are losing money on their new customers, who tend to be relatively sick and expensive to treat. As a result, some smaller plans have been driven out of business and a few major ones are defecting from exchanges for the coming year.

The administration’s efforts reflect the partisan thorns that still surround the sprawling law a half-dozen years after its passage. The payouts that officials want to salvage were part of an ACA strategy to help the marketplaces flourish early on. But Republican opponents in Congress branded them an insurance industry “bailout” and restricted the use of HHS funds.

A settlement probably would rely on Treasury’s Judgment Fund, a 1950s creation that is allowed as much money as it needs to satisfy valid claims against the government. The fund’s website shows that it has been used for a few hundred claims against HHS in the past decade. Taken together, they amounted to about $18 million — a fraction of what the insurers are owed.

In the administration’s waning months, officials are continuing their upbeat portrayal of all aspects of the law. Behind the scenes, they think that making these payments to insurers — $2.5 billion for 2014 and an as-yet-undisclosed sum for 2015 — is crucial to the exchanges’ well-being.

“It’s a legacy item for the White House,” said Dan Mendelson, president of the health consulting firm Avalere and an adviser on the payout effort. “It’s more than just a lawsuit. It’s really about the future . . . and stability of these markets.”

GOP lawmakers are already beginning to cry foul. “It’s an end run on the clear . . . intent of Congress,” said Rep. H. Morgan Griffith (Va.).

The money in question involves one of three strategies to help coax insurers into the marketplaces by promising to cushion them from unexpectedly high expenses for their new customers. This particular strategy, known as “risk corridors,” was for the marketplaces’ first three years, when it was unclear how many people would sign up and how much medical care they would use.

The idea, patterned after a similar arrangement for health plans that sell Medicare drug benefits, is to balance out insurers’ costs by requiring those with unexpectedly low expenses to pay into a fund that would be used to compensate companies with unexpectedly high expenses. The program originally was not supposed to pay for itself, but two years ago the Republican-led Congress restricted HHS from using any of its other money for that purpose.

The risk corridors started in 2014. The crunch became apparent last fall, when federal health officials announced that they faced an enormous gap because so many more health plans incurred high expenses for their ACA customers than low ones. For that reason, HHS made less than $400 million in 2014 risk-corridor payments — just 12.6 percent of $2.9 billion it owed overall.

Beyond the 175 insurers owed money for the first year, health officials have not said how many need to be paid for 2015, how much they are due or how much money is available. But in a five-paragraph memo this month, HHS’s Centers for Medicare and Medicaid Services said any money that is available will be put toward what the government still owes for 2014.

The risk corridor payments are “an obligation of the federal government,” acting administrator Andy Slavitt told a recent House hearing.

The shortfall has contributed to the collapse of most of the 23 nonprofit, consumer-oriented health plans created under the ACA, forcing several hundred thousand people to find new coverage. Just six co-ops remain. Four of them, including two that have closed, are among the seven insurers suing the government for lack of payment.

CMS spokesman Aaron Albright referred questions to the Justice Department. Justice spokeswoman Nicole Navas declined to confirm the settlement talks because the litigation is pending.

One health plan executive, whose attorney has spoken with Justice officials, said the department is trying to reach an agreement with suing insurers in the next two weeks on what percentage of the remaining $2.5 billion would be paid out. At that point, the same offer would be made to every other insurer owed money. A judge would need to approve the arrangement, according to the executive, who spoke about the pending litigation on the condition of anonymity.

Stephen Swedlow, a lawyer for Health Republic Insurance in Oregon, a co-op that was forced to close early this year, said he is preparing a settlement proposal to send to Justice. Said Health Republic chief executive Dawn Bonder: “I don’t think DOJ is making a secret that they would like [the lawsuits] to go away.”

Writtent by Amy Goldstein, a national reporter for The Washington Post, focusing on health-care policy.

Subsidies might become available to buy ANY health insurance plan

By | Health Insurance, Health Reform

Republican Senators push for more affordable insurance options under ACA

U.S. Sen. Lamar Alexander

U.S. Sen. Lamar Alexander

WASHINGTON – Concerned by skyrocketing premiums and fewer coverage options, U.S. Sen. Lamar Alexander and other Senate Republicans are pushing to give more choices to Americans who

buy health insurance through one of the marketplaces set up under the Affordable Care Act.

Their legislation wouldn’t permanently fix what’s ailing the 2010 law, informally known as Obamacare, Alexander said. But it could provide temporary relief for millions of Americans who in November will begin buying their insurance for next year.

“If the market is collapsing in our face, we need a solution for the year 2017,” said Alexander, a Maryville Republican and chairman of the Senate committee that oversees health-care issues. “This is a solution for that.”

The bill, introduced last Wednesday by Alexander and seven other Republicans, would give states authority to temporarily let residents use their Obamacare subsidies to buy a health plan of their choice for 2017, even if it’s available outside an Affordable Care Act marketplace.

States that exercise that authority would receive a one-year exemption from an Obamacare provision requiring people to buy a specific plan or pay a fine of up to $2,000 per year.

Alexander says such steps are necessary given the turbulence in the health-insurance market.

Just last month, insurance giant Aetna announced that next year it will pull out of the federal online marketplace — HealthCare.gov — in most states where the exchange operates.

Around the same time, Tennessee Insurance Commissioner Julie Mix McPeak declared the federal exchange in the state “very near collapse” and signed off on large premium increases that she said were necessary to keep it in business.

Cigna was given permission to boost its rates an average 46.3 percent. Blue Cross and Blue Shield of Tennessee was granted an average 62 percent increase.

The problem stretches far beyond Tennessee, Alexander said. Come November, nearly one-third of the nation’s counties will have only one insurer to choose from on state-based exchanges created under the Affordable Care Act, he said.

“This is an immediate problem in our state and the whole country,” Alexander said. “Premiums are skyrocketing. Insurance companies are leaving, and families are being left with one choice for insurance.”

President Barack Obama’s administration argues that Tennesseans are actually benefiting from the Affordable Care Act.

New census data shows that just 10.3 percent of Tennesseans went uninsured in 2015, down from 14.4 percent in 2010. That means that 266,000 more Tennesseans had health coverage in 2015, according to the U.S. Department of Health and Human Services.

The average family premium in Tennessee was $2,100 lower in 2015 than it would have been had premiums grown at the same rate they did in the decade before the Affordable Care Act, the White House Council of Economic Advisers says.

What’s more, hospital re-admissions for Tennessee Medicare beneficiaries dropped 8.7 percent between 2010 and 2015, according to the Centers for Medicare and Medicaid Services. That drop translates into 2,905 times Tennessee Medicare beneficiaries avoided an unnecessary return to the hospital, the agency said.

“Affordability, access and quality are how we measure success in our health care system,” Health and Human Services Secretary Sylvia Mathews Burwell said in a recent news release. “Tennessee is making progress on all three under the Affordable Care Act.”

Making the case that Obamacare is working requires “a vivid imagination,” Alexander said.

But getting his legislation passed in time to help Americans buying next year’s health insurance will take some ingenuity.

Congress will be in recess all through October and won’t be back in session until after the November election, right around the time most Americans will begin shopping for insurance for 2017.

Passing the bill in that time frame “will be hard to do,” Alexander said. “But that doesn’t mean we shouldn’t try.”

Article written by Michael Collins, The Tennessean’s Washington correspondent.

Opt out of Obamacare – We took all the pages out of the playbook and make it easy for you….

By | Health Insurance, Health Reform

There’s a right way to opt out of Obamacare.

But first, here’s the wrong way.  This would be declining to buy health insurance, failing to make other arrangements to pay for catastrophic medical expenses, not shopping for care and paying the ‘list’ price for doctor’s visits and prescription drugs, and simply relying on the emergency room to get needed care in the event of a major injury or illness.

This approach leaves people who opt out vulnerable to sky-high medical expenses at inflated ‘list’ rates, and can result in an inability to obtain needed care because of cost.

Now for the right way(s) to opt out of Obamacare…according to your own personal needs and preferences.

First up, protection from major medical bills and getting needed funds to pay for care. Here are a couple of the best options:

  1. Join a health care sharing ministry. These are voluntary, charitable membership organizations that agree to share medical bills among the membership. They function similar to insurance, and are probably the best alternative to conventional health insurance. There are four of them, at least that I know of. Three are open only to practicing Christians (Samaritan Ministries, Christian Healthcare Ministries, and Christian Care Ministry) while a fourth, Liberty HealthShare, is open to anyone who agrees with their ethical commitment to religious liberty. They operate entirely outside of Obamacare’s regulations, and typically offer benefits for about half the cost of similar health insurance. Members are also exempt from having to pay the tax for being uninsured.
  2. Buy a short-term health insurance policy. These policies usually last between 1 and 12 months and are not regulated under Obamacare, and therefore don’t offer the same high level of benefits that can drive up costs. Deductibles are available that are higher than what is allowed with Obamacare-compliant health insurance, leading to further savings. They can typically be renewed at the end of the policy, although it is a new policy that won’t cover any conditions that occurred under the previous short-term policy. Another limitation is that they often can’t be renewed over and over again, it looks like 3 years of coverage is about the maximum. But they are much less expensive than conventional health insurance, and can be a good option for covering major medical expenses.
  3. Buy alternative insurance products like fixed-benefit, critical illness, or accident insurance. These policies pay cash in the event you are diagnosed with cancer, spend a night in the hospital, or need some other medical treatment. They cost a fraction of what health insurance costs under Obamacare, and by giving you cash directly you aren’t locked in to any particular provider network. Another thing to do is to max out your medical and uninsured/underinsured driver coverage amounts under your auto insurance policy, which can pay medical bills if you are hurt in a car accident.

We make opting out of Obamacare simple.  Our Family Protection Grid brings all of the best ways to opt out and be protected under one roof.

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There are a handful of other options for funding major medical expenses, things like charity care, medical fundraising, or personal savings, retirement accounts and home equity loans. But none of these should be anyone’s first choice unless they’re a multi-millionaire who doesn’t mind dipping into their bank account to pay for needed treatment.

Once somebody opting out of Obamacare has gotten their alternative coverage arranged, it’s time to shop for health care providers and medical treatment in the event you need it. The first thing to remember is that nearly every price in health care is essentially fake. Insurance companies don’t pay ‘list’ prices, and neither should the self-pay patient. Here are the leading ways to find affordable health care at real prices:

  1. For primary care, visit cash-only doctorsand retail health clinics. These offer up-front pricing that is usually the same or even less than the discounted rates that insurers pay when their customers visit the doctor. If you expect to need to visit a doctor more than a few times a year, you might want to consider joining a direct primary care practice, which for a modest monthly fee will give you nearly unlimited access to a primary care physician.
  2. Sign up for a telemedicine service. These are low-cost options that provide doctors who can treat relatively simple medical needs by talking with patients over the phone, exchanging e-mails, or visiting via a video connection. They are great for common injuries, conditions, and illnesses, providing convenient care at a low cost.
  3. For prescription drugs, use generics whenever you can, and be sure to compare prices between different pharmacies. Several of the large chain pharmacies (Walmart, CVS, Target) offer 1-month supplies for $4 for thousands of common generic drugs, and a couple of online sites (com, WeRx.org) allow you to see which pharmacy in your area offers the best deals for your medications.
  4. For more significant medical needs, such as surgical care, go to a facility that provides up-front ‘package’ pricing for patients paying in cash, like the Surgery Center of Oklahomaand Regency Healthcare. These facilities offer real prices that are typically much less than what most hospitals charge. You can also use a service like MediBid, where doctors bid on providing your treatment.
  5. In the event you need to go to your local hospital for an emergency or a scheduled treatment, work with a medical bill negotiation serviceto get the best price possible. Hospitals typically charge wildly inflated ‘chargemaster’ prices to people without conventional health insurance, usually between three and five times more than what an insurer would pay for the exact same service. You can also try to negotiate on your own by using a service like Healthcare Blue Book or Pricing Healthcare to find out what insurers are paying, but be prepared to put a lot of time and effort into it if you do.

There is also the matter of the tax for being uninsured. Two things to keep in mind: there are a couple of exemptions you may qualify for, and the tax is for many people going to be less than the cost of paying premiums for conventional health insurance.

The first exemption, mentioned briefly above, is for members of health care sharing organizations. Even though they aren’t technically insurance, they do provide coverage and Congress chose to exempt members from having to pay the tax for being uninsured.

There’s also an exemption for people who find that premiums are unaffordable, at least by the government’s definition. If the least-expensive Bronze plan in your area costs more than 8% of your adjusted gross income, you’re exempt from the tax.

Otherwise, you’ll be taxed 1 2.5% in 2016. So someone with an $80,000 income in 2014 will owe an $800 tax, even if they have a fixed-benefit policy, short-term policy, or some other alternative that isn’t membership in a health care sharing organization.

One caveat, however: the IRS can only collect the tax by reducing your tax refund. So, no refund equals no tax. I’m not necessarily suggesting this as a tax strategy (irritating the IRS just seems like a bad idea on a number of levels), and it won’t surprise me at all to see Congress one day try to ‘fix’ this little loophole. But as the law stands right now, and as the IRS itself has posted, the only way they have to collect the tax is by taking it from your refund, so if you don’t have a refund coming back to you there is no way the IRS can force you to pay the tax.

Deciding to opt out of Obamacare is a fairly serious decision. But there’s another decision that people who want to opt out need to make, and that is whether they want to do it the right way by doing a little planning and knowing their options, or the wrong way which would be just to opt out and not give the matter any more thought until they’re on the way to the hospital with a busted leg or notice a lump in their breast.

 

Based on the Sean Parnell which appeared in The Federalist