Will more be insured? Will we have the health professionals to meet their needs?
Last month’s column looked at how health insurance eligibility changed under ACA and explored the “coverage gap” in states choosing not to expand Medicaid. This week we’ll explore other implications of this revolutionary change in how health insurance is secured and paid for.
On balance, will the share uninsured go down?
Cutting the ranks of the uninsured is a key objective of ACA. Not all of the 8 million who signed up for new plans were previously uninsured: According to early surveys, two thirds to three quarters of these enrollees were changing plans. No surprise here. ACA offers subsidies that are significant for many, making the Marketplace plans very attractive for those who qualify. Others who didn’t qualify for subsidies still found the Marketplace plans a good deal. Competition spurred by the Marketplace drove down prices for nonemployer plans in some states, including New York.
Yet some will choose to pay the penalty for being uninsured instead of the premiums. Insurers are now required to cover a fixed set of preventative services at no extra cost to the consumer. The law also limits what consumers can be charged for care within a single year. Initially, ACA required that a 2014 policy must cover all costs above $6,350 for singles or $12,700 for families. That’s the “out-of-pocket maximum,” now delayed until 2015. (These deductibles are subsidized for individuals and families below 250% of the poverty line.) This shifts the financial burden of major illness from the insured to the insurer. Both changes make for better insurance—but they cost insurers more and premiums will rise. Read more »
Like most aging runners, my wife’s knees aren’t what they used to be. Fortunately, there is a solution to this problem—knee replacement has become nearly routine surgery. The Agency for Healthcare Research and Quality reports 718,000 hospital stays in 2011 were due to “knee arthroplasty” or total knee replacement. The rate per 10,000 population nearly doubled from 1997. Yes, the aging of the population has something to do with the increase—yet even among 65-84 year olds the rate increased by 59% (http://www.hcup-us.ahrq.gov/reports/statbriefs/sb165.jsp). And yes, the rising rate of obesity explains part, but not all, of the trend.
We needn’t look to sophisticated studies for the reason as joint replacement surgery can significantly improve quality of life. A 2011 “meta analysis” of over 100 studies concluded that nearly 90% of artificial knees were still doing the job 10 years after surgery. As these studies necessarily involved surgeries that took place before 2000, results have almost surely improved. For most patients, an artificial knee (or hip) can be expected to last 15-20 years. Recovery time is getting shorter, too. Many patients are back to driving in a month. If you can’t walk without pain, an implant would seem to be an easy choice. Provided you can convince your insurer to foot the bill.
Which brings us to the cost of artificial joints. Did you wonder why the medical device industry gets its very own tax under the Affordable Care Act? American health care’s dysfunction has enabled the medical device industry to earn very robust profits, thus making it a target for special treatment. Does this tax make sense? Read more »
New York isn’t alone in struggling with the financial viability of its public nursing homes. Across the country, public nursing home operators are weighing their options in an era of diminishing state and federal reimbursement. Many counties, especially those in the Northeast, are choosing to sell, or contract out management of the homes, in order to stem financial losses.
In New York, 92% of homes had operating deficits in 2010, as CGR detailed in our in-depth report, The Future of County Nursing Homes in New York State. Financial pressures have led 8 of the 33 remaining counties with homes to decide to sell them, and another 5 to actively consider it. If all those potential sales actually occurred, New York would be left with 20 counties with nursing homes, down from 40 just 15 years ago.
From 2005 to 2009, half of states had declines in the number of public nursing homes, compared to 28% that had increases (more recent data aren’t yet available).
Read more »
The health insurance mandate, probably the most visible outcome of the Patient Protection & Affordable Care Act (ACA or Obamacare), goes into effect in January. Enrollment in the health insurance exchanges opens October 1, so much attention has been focused on the premiums: Supporters of the law hope for lower rates; opponents have been widely predicting that rates would soar.
In July, premiums for New York State’s Health Insurance Marketplace were released and revealed two notable facts: First, premiums in the individual market are far below current rates. Second, Rochester has the lowest rates in the state. Read more »
Our nation’s fiscal house is held together with duct tape and Crazy Glue. The porch roof is teetering—left unrepaired, it may collapse onto our economy at the end of the year. And our home’s foundation has a crack in it. While this structural gap between revenue and spending—largely caused by Baby Boom retirements—won’t be dramatically worse next year, the crack will get larger and larger until we make major repairs.
A wide array of tax cuts are due to expire at the end of 2012. As the Bush White House couldn’t muster the 60 votes required for a permanent tax change, the 2001 tax cuts were passed using the Senate’s arcane “reconciliation” procedure, which forced a 10 year “sunset” provision. (The vote was 50-50 with Vice President Dick Cheney casting the tie-breaker.) Unable to reach consensus on much of anything in 2010, the President & Congress kicked the can down the road another 2 years. In February, the 2 percentage point reduction in the payroll tax rate originally passed in 2010 was extended to the end of the year.
So, what happens if Congress & the President don’t do a deal? Read more »
Public Union Impact: Past and Future
Recent and ongoing work by CGR in several counties throughout New York has placed a spotlight on public employee unions and their impact on the cost of governmental services. In particular, the future status of county-owned nursing homes is directly affected by high labor costs and especially high benefit levels that have historically been negotiated with public unions, to the benefit of public employees and at the expense of taxpayers. County nursing home benefit levels, including retirement pensions and health insurance costs, are typically at least double the corresponding level in non-public facilities.
In decades past, county nursing homes were providers of last resort for the poor. While county homes continue to accept some residents that other facilities are reluctant to admit, as Medicaid has become a source of support for the long-term-care needs of both the poor and the middle class, nearly all nursing homes, both private and public, depend on Medicaid funding for a substantial share of revenue. Where county-owned homes are no longer the only facilities caring for the poor, they compete more directly with privately-owned homes. In this more competitive context, counties are questioning how much longer they can ask their taxpayers to cover the employee cost differential created by collective bargaining agreements—especially as counties face increasing fiscal stress, and as nursing homes face the prospects of probable declines in reimbursements looming in the near future. Read more »
In this column, we address the challenge of expanding health insurance coverage. First, we explore why our employer-based system leaves gaps in coverage, even for people with jobs. Second, we discuss the challenge of relying on the individual insurance market, which has to fill these gaps.
Read more »
In April, Kent wrote of a woman who had signed up for a “consumer-directed health plan.” While the plan saved her money, she yearned for days when she didn’t have to think about the cost of a doctor’s visit or a prescription.
Traditional health insurance insulates us from the visit-by-visit, script-by-script cost of care. That’s a problem. Facing only a fixed co-pay (or not even that), we don’t look at the “right side of the menu.” In our health care “restaurant,” the menu doesn’t tell us that the Lobster Thermidor costs twice as much as the Chicken Piccata. And we don’t care, because “insurance” will pay for it.
Last week we explored regulatory approaches to slowing health care spending growth. Today we discuss changing the incentives for consumers, providers and insurance markets.
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There is a speechwriter in Washington who smiles each time someone says “bending the cost curve.” “Cutting health care costs” may be unattainable but “bending the curve” is essential.
To summarize our first two columns: Cost lies at the heart of the health care problem. Health care insurance masks the price signals that guide buyers and sellers. Providers are paid to do more and consumers have little incentive to refuse (go to www.cgr.org and click on the Policy Wonk link to read the first two).
In this column and the next, we look at ways to tame cost growth.
Read more »
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Tempted? We’ll be attempting a similar feat over the next four weeks. Jim Fatula and Kent Gardner will be offering a “back to basics” look at the debate over health care reform. Two core issues—health care cost and health insurance coverage—occupy center stage.
Visiting Washington this summer, Kent watched a session of the Senate and listened to a member’s passionate speech on this subject. Yet he spoke to an empty chamber. Only one other senator was present. Oh, and C-SPAN’s camera, focused only on him. It seemed a metaphor for what has been a sorry debate, filled with speeches but few discussions. Radicals on both ends of the spectrum are driven more by ideology than by thoughtful differences in policy. This is a war between different faiths, a bitter competition between tribes in which winning is the only goal.
Read more »