The Affordable Care Act and the Smokers’ Penalty

Posted on May 5, 2013 by Maggie Mahar

Under the ACA smokers buying insurance in the Exchanges will have to pay a 50% “Premium Surcharge.” For a 55-year-old smoker, the penalty could reach nearly $4,250 a year. http://news.yahoo.com/penalty-could-keep-smokers-health-overhaul-205840155.html Does this mean that Americans who smoke won’t be able to afford coverage?

No. In the end, most smokers should be able to get health insurance without paying a stiff penalty.

For one, it’s up to individual states as to whether they want to let insurers charge smokers more. By early April of 2013, Rhode Island, Vermont, Massachusetts and D.C. had voted to eliminate smoking premiums in their health care exchanges: The American Cancer Society, which is opposed to the surcharge, is working to persuade other states to ban it. (The ACS explains: “We’re anti-smoking, not anti-smoker.”)

I agree with the ACS that the penalty is counter-productive. If it makes insurance unaffordable for some smokers, this means that they won’t have access to smoking cessation programs, nicotine patches and other drugs that could help them quit. Keep in mind that most smokers want to quit, and these programs have proved extremely successful.

The good news is that many Americans who are addicted to nicotine will be eligible for Medicaid. In the U.S. 39 percent of adult smokers live below the poverty level. . Many more live below 133 percent of the poverty level. As states expand Medicaid, they, too, will become eligible for the program. Since Medicaid charges no premiums, they will not pay a premium surcharge.

Meanwhile, new research by the George Washington University School of Public Health and Health Services indicates that including comprehensive tobacco cessation benefits in Medicaid insurance coverage can result in substantial savings for Medicaid. The study found that every dollar spent on tobacco cessation program costs resulted in an average program savings of $3.12, which represents a $2.12 return on investment.

Under the Affordable Care Act all state Medicaid programs are required to cover tobacco cessation medications, beginning in 2014.

Finally smokers who receive health benefits from their employer are likely to find that they don’t have to pay the premium if they join a smoking cessation program.

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Navigators: The Folks Who Will Help You Surf the New Insurance Exchanges

Posted on April 30, 2013 by Maggie Mahar

Over at Healthinsurance.org, I’ve addressed some “frequently asked questions” about the “navigators” who will help individuals and small business find the coverage they want in the new Exchanges.

– Who Will Become Navigators?

– Can Insurance Agents and Brokers Apply to Be Navigators? (Wouldn’t that create a conflict of interest?)

– Just How Will Navigators Help People Sort Out Their Options in the Exchanges?

– How Much Training Will They Receive?

–Finally, many people worry that the “navigators” just won’t be able to handle the heavy traffic. Giving the American public the information it will need about Obamacare is an enormous task. Will these navigators be up to it?

The answer to that last question is that the navigators will have help. Patient advocacy groups, the states, and county health agencies will pitch in. The federal government also is launching a marketing program, “Enroll America” that will urge mothers to nag their uninsured 20-something and 30-something sons. (Seriously– and I expect that in many cases, this will be effective.)

Meanwhile insurers will be eager to draw young, healthy customers into the Exchanges. This means that they will invest in marketing campaigns designed to let 20-somethings and 30-somethings know that the vast majority will be eligible for generous government subsidies.

Just one example: Blue Cross and Blue Shield of Illinois already has launched a “Be Covered Illinois” campaign. The campaign is being funded by the insurer, and carried out by various community groups:

Keep in mind that if insurers mislead customers about their offerings, those customers will have an opportunity to pick a different plan a year later. And under the ACA, they will have “navigators” to help them make a better choice.

Insurers know this. They also are well aware that under the new ACA rules that regulate them, a health insurance company will have to draw—and keep—a large share of the market’s customers in order to survive financially. For that reason, I suspect that savvy insurers will make a major effort to provide information about specific plans that will attract customers who will want to stick with those plans.

For my answers to the first four questions above, go to Health Insurance.org, click on the question and the answer will pop up.

Problems with Health Insurance? Under the Affordable Care Act You Will No Longer Be Alone

Posted on April 12, 2013 by Maggie Mahar

If you sent in your health insurance payment on time, and paid it the way you always have (as a direct withdrawal from you checking count), but made a mistake when you put the checking account number on your payment, would you expect that your insurer would drop you?

What if your insurer sent you an email a few days after you sent in your payment saying “Your payment has been received? Wouldn’t you assume that you were still insured?

Mike Holden did. He was wrong.

Yesterday, he sent an email explaining his story.

“On March 16, I paid my family’s monthly health insurance bill to United Healthcare (UHC) the same way I have for almost a year now. But I was using a new bank account that we set up after a recent move. Unfortunately, I entered the account number incorrectly. It turns out I left off three digits that are part of the account number but listed separately on the checks.”

Holden had no idea that he had made a mistake. On March 20, he received an email from UHC saying “Your payment has been received.”

Yet in April, when he went online to pay his family’s April bill, he was told his coverage had been terminated. He then talked to a customer service representative at UHC and received a letter explaining that he had until March 31 to correct his mistake.

Unfortunately, the letter, which was postmarked March 27, went to his old address. .

He appealed to UHC, explaining the problem and asking that his insurance be reinstated,

He then received a letter telling him that his appeal had been denied: “United Healthcare Benefit Services follows the guidelines for payments and grace periods defined by the Department of Labor. Your account has been reviewed and the termination remains, as payment was not received within the guidelines provided.”

How the Affordable Care Act Brings Us Together

Beginning in 2014, people like Mike Holden will no longer be alone, trying to stand up to insurance companies. Individuals and families who buy their own insurance will be able to purchase coverage in “Exchanges”—marketplaces where insures will be regulated and individuals and families who purchase their own insurance will become part of a large group. There, they will have far more clout than they do now.
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A Doctor Confides, “My Primary Doc is a Nurse”

Posted on April 3, 2013 by Maggie Mahar

Last week I interviewed a doctor who told me that his primary care doc is a “physician assistant” who has been trained to deliver primary care. He said it casually, dropping the fact into a long conversation.

Dr. David Kauff is an internist at Seattle’s Group Health Cooperative (GHC), an organization that has a fabulous reputation–both among patients and among physicians—for its primary care program. One reason is that at Group Health, doctors, physicians assistants and nurse practitioners work together in teams. “The success of our model is based on the fact that everyone in this together; we are corralled by a common purpose,” says Kauff, who also serves as GHC’s Medical Director for Practice and Leadership.

I’ll be writing more about Group Health Cooperative in a few days.

In this post, I would like to focus on the growing role of Nurse Practitioners (NPs) and Physician Assistants (PAs) as clinicians. NPs are registered nurses who have gone on to earn a master’s or a doctorate. Some specialize in areas such as anesthesiology, pediatrics (pediatric nurses) or Ob-Gyn (certified nurse-midwives). NP’s can run clinics; some run their own practices.

By contrast, physician assistants (PAs) don’t usually work alone. While physicians may not be on-site, typically doctors oversee their work.

PAs are formally trained to provide diagnostic, therapeutic, and preventive health care services. They take medical histories, examine and treat patients, order and interpret laboratory tests and X- rays, and make diagnoses. In many cases, they did not begin their careers as nurses. They may have been paramedics, respiratory therapists, or emergency care technicians (EMTs) before becoming PAs.

Currently, 17 states, plus the District of Columbia, let nurse practitioners operate independently. In 33 states regulations vary. As this map reveals, in some places NPs are not allowed to prescribe medication. In others, they may have to consult with a physician when treating patients.

It’s worth noting that NPs enjoy greater freedom in the Northwest, the Upper Middle West, and Northern New England (areas that some healthcare reformers refer to as “Canada South” because these states are in the vanguard of reform) as well as in the Southwest, where many NP’s started working in group practices, and they went out and established their own clinics. Nationwide, about 6,000 nurses operate independent primary-care practices.

Why Physicians Object

Today, 14 states are debating whether NPs should be allowed to practice on their own. Many emphasize the difference in education and years of training. Though in truth, the length of training is not so different. Becoming a primary care doctor requires four years of medical school plus three years of residency. A nurse practitioner attends nursing school for four years, then spends two to three years in graduate school, depending on whether he or she is getting an M.A. or a Ph.D. (In 2015, all nurse practitioners will be required to earn a Ph.D.)

Most NPs also have nursing experience. At the University of Michigan, for instance, the average candidate admitted to the NP program has 7 years of hands-on experience as a nurse. But while the number of years spent training are not so different, as I explain below, traditionally ,the nature of that training has been very different.

Doctors say that they are worried about patient safety. “I see it as physicians being true to their oath “ Dr. Adris Hoven, president-elect of the American Medical Association recently told Marketplace Health Care’s Dan Gorenstein. Hoven insists that doctors are “not threatened” by NPs. “At the end of the day what they want to do is deliver the best healthcare possible.”

Dr. John Rowe, a professor of Health Policy and Management at Columbia’s School of Public Health, doesn’t buy the argument. As he points out, nurse practitioners are already working without primary care doctors: “The fact is this is going on in 16-17 states,” he told Gorenstein, “and there is no evidence that it’s not good for the patient.” A recent Health Policy Brief from Health Affairs and the Robert Wood Johnson Foundation backs him up: “studies comparing the quality of care provided by physicians and nurse practitioners have found that clinical outcomes are similar.”

At the same time, Rowe understands why doctors are uncomfortable. “The physicians feel they have something special to offer,” he explains. “And being told there are individuals who are less well trained can do it as well as they could is a very difficult lesson for them.”

When I last wrote about nurse practitioners, back in 2010, one physician/reader (“Sharon M.D.”) was exceptionally candid on this point:

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Who is Douglas Holtz-Eakin and why is he saying such terrible things about health reform?

Posted on March 15, 2013 by Maggie Mahar

Today, the House Energy and Commerce Committee’s Subcommittee on Health will hold a hearing entitled: Unaffordable: Impact of Obamacare on Americans’ Health Insurance. (Always nice to know that our elected representatives are keeping an open mind.)

Prominent on the list of witnesses: “Douglas Holtz-Eakin.” Even before reading his testimony, I knew what Holtz-Eakin would say: young, health Americans should brace for “sticker shock.” Conservatives like Holtz-Eakin tend to stay on script. However stale the rhetoric, they firmly believe that if you repeat a sound-bite often enough, people will believe it.

Who is Douglas Holtz-Eakin?

If you recognize the name, it’s probably because Holtz-Eakin has become a familiar figure in the mainstream media, quoted in the New York Times, writing Op-eds for Reuters and Politico.com, and appearing, not only on Fox Business News, but on CNN and the PBS’ Newshour.

Alternatively, “Holtz-Eakin” may ring a bell because he served as a member of George W. Bush’s Council of Economic Advisers (CEA), and as Director of Bush’s Congressional Budget Office (CBO.)

In a remarkably candid 2011 interview, Holtz Eakin recalled his tour in the Bush administration:

“Going into the summer of 2001, things were getting worse. . . When we first went in and talked to the President, Glenn [Hubbard] and Larry Lindsey said, ‘Mr. President . . . We’re probably not going to run a surplus on budget. We’re going to run a deficit.”

Bush’s reply: “We’re not going to run a deficit. If you come in here with a deficit, you’re both fired. Go fix it.’”

“We ended up running a budget surplus of one billion dollars,” Holtz-Eakin confided, “driven by gimmicks of remarkable proportions.”
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Why Is It That the Truth Never Goes Viral?–A Campaign of Misinformation Unites Conservative Activists and Insurers

Posted on March 1, 2013 by Maggie Mahar

The Post below originally appeared on Healthinsurance.org (mm)

Wild rumors, such as the one claiming Obamacare premiums will start at $20,000 a year for a family of five, are much jucier than the truth.

About a week ago, Investor Daily’s website published a “Fact-Check” post that illustrates how misinformation spreads.

In the post, Jed Graham explains that when the IRS published a final rule about penalties under the Affordable Care Act (ACA), it included a few hypotheticals. For example, the IRS wrote, “The annual national average bronze plan premium for a family of 5 (2 adults, 3 children) is $20,000′ in 2016.”

The $20,000 figure was just an example, Graham explains. “The IRS always uses hypothetical numerical examples in its regulations to illustrate how the rules will work in practice and this was no different.”

Nevertheless, before long, the “conservative news site CNSNews.com began to blare out this shocking headline: ‘IRS: Cheapest Obama Care Plan Will Be $20,000 Per Family.’”

From there, “the ‘fact’ got picked up by countless media outlets and pundits” Graham reports, “most of them on the right,” including:

•Betsy McCaughey writing for the New York Post;

•Rush Limbaugh;

•Breitbart

•On the left, even Naked Capitalism (a well-researched blog,) reported the news bulletin from CNSNews.com.

This is the problem: Once a faux-fact gets out there, even reporters who have no axe to grind continue to repeat it. If you see the number often enough, you assume it must be true.

How could a reporter tell that $20,000 wasn’t an IRS estimate?

It should have been clear that this was a hypothetical, Graham points out, if you just looked at other hypotheticals in the IRS ruling. “For example: ‘the annual national average bronze plan premium for a family of 4 (1 adult, 3 children) is $18,000.’

“Both examples can’t be true,” he observes, “unless an adult’s premium is $2,000 and a child’s is $5,333.”
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Obama to Boehner: “John, I’m Getting Tired of Hearing You Say That”

Posted on February 26, 2013 by Maggie Mahar

This was President Obama’s reply, during fiscal cliff negotiations, when House Speaker John Boehner declared, for the umpteenth time, that “ The U.S. has a spending problem.”

I can understand the president’s irritation. How could anyone believe that we have a “spending problem?’

Look around. Consider the state of our bridges, our roads and our crumbling inner city public schools. Are we spending too much on the nation’s infrastructure?

Next, think about unemployment. During this recovery we have lost 750,000 public sector jobs. Republicans are intent on “starving the beast” (of government) and as a result Washington has not given states the financial support they need continue delivering public services. Across the nation, public school teachers have been laid off in droves, while class sizes increase at unprecedented rates. Does this sound like government spending run amuck?

One in five American children now lives in poverty. Seventeen million children find themselves in homes where they can’t be sure of getting enough to eat. (a.k.a. “food-insecure households.”) At the end of the month, many kids go to bed hungry because the government Food Stamps program (now known as Supplemental Nutrition Assistance Program, or SNAP) gives families less than $1.50 per person per meal. Are we being overly generous?

During the past two wars, we sent millions of American men and women to Iraq and Afghanistan –many went back for repeated tours. In some cases, their bodies were not broken–but their minds were. Now 1.3 million Vets seeking mental health services are told they must wait of 50 days before getting treatment. A recent government report suggests that 22 Vets die by suicide every day – about 20 percent of all Americans who kill themselves. Are we spending too much on healthcare for Veterans?

Let me suggest that we don’t have a spending problem. We have a revenue problem. Current federal revenue levels are at their lowest levels since the 1950s.

How Anti-Tax Pledges Have Weakened the Nation

In a recent post, Jared Bernstein, a senior fellow at the Center on Budget and Policy Priorities, nailed it: “The tax system doesn’t raise enough revenue. And that’s not just the recession; it’s also tax policy and anti-tax pledges . . . The system has become less progressive, with the largest declines in effective tax rates at the top of the income scale.

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Health Wonk Review Posts Investigate

Posted on February 19, 2013 by Maggie Mahar

Nursing Homes, Nurse-Practitioners Developing More Expertise, Efforts to Block Exchanges, How Patients Respond to Evidence that Some Tests are Unnecessary, and Whether Obamacare “Screws” Young Americans . . .

This time around Peggy Salvatore hosts a Valentine’s Day Edition of Health Wonk Review –over at Healthcare Talent Transformation . Her round-up of some of the best of recent HealthCare posts includes:

– A piece on Health Affairs Blog by David Rothman investigating how Americans respond to “evidence that certain medical tests and screenings might be unnecessary, harmful, and not worth the money.” How do they react to research showing that some drugs are harmful? To find out, you’ll have to read the post. (You will find the link to this post, and all of the posts discussed below, here )

– Good news from Louise at Colorado Health Insurance Insider: A bill that would have repealed the 2011 law that created Colorado’s health insurance exchange/ marketplace, died in committee in a 9-2 vote. “Republicans and Democrats on the Committee on the committee rejected his portrayal of the Exchange– which has already made a lot of progress towards an opening date this fall.”

Louise adds: “Given the progress that Colorado has made over the past two years in creating the state’s marketplace and implementing various other healthcare reforms (both state-based, like maternity coverage and gender-neutral premiums, and ACA-related, including the recent push to expand Medicaid), I would say that Colorado is on track to greatly improve its overall healthcare outcomes.

She also includes a useful map showing the states that have defaulted on setting up Exchanges. As she notes “this doesn’t mean they will get a pass on Obamacare.” By law, the federal government will set up Exchanges for them.

– A post by Disease Management Care Blog’s Dr. Jaan Sidorov pointing out that non-physician professionals and lay-persons are managing to achieve a remarkable degree of medical expertise. This is, as Peggy notes, a controversial subject.

– A report that asks “do non-profit nursing homes really provide better care than their for-profit counterparts”? Over at Healthcare Economist Jason Shafrin analyzes a study that suggests the answer is “Yes.” How do they arrive at that conclusion? Again, you’ll have to read the post.

– A post that takes on “a recent infamous article on Buzzhead ” claiming that Obamacare “screws” young Americans. Over at California Access Health’s Anthony Wright observes: “there are some obvious and non-obvious reasons why Obamacare is a boon to young adults. “ The non-obvious reasons are worth thinking about.

These are just a few of the treats in this Valentine’s Day Edition. I recommend that you read the entire Review here.

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Obama’s Proposals For Medicare — Do They Go Far Enough? Will They Become Law?

Posted on February 18, 2013 by Maggie Mahar

Not long ago, I wrote about the Center for American Progress’ (CAP’s) “Senior Protection Plan” —a report that aims to rein in Medicare “by $385 billion over ten years without harming beneficiaries.” In that post, I suggested that CAP’s proposals might well give us a preview of the “modest adjustments” that President Obama had said he would be willing to make to Medicare. At the time, I highlighted three of CAP’s recommendations:

– increase premiums for the wealthiest 10% of Medicare beneficiaries (raising $25 billion);

– insist that drug-makers extend Medicaid rebates to low-income Medicare beneficiaries (saving $137.4 billion);

– prohibit “pay for delay” agreements that let “brand-name drug manufacturers pay generic drug manufacturers to keep generics off the market” (saving $5 billion).

Last week, in his State of the Union address, President Obama embraced the first two: “Already, the Affordable Care Act is helping to slow the growth of health care costs,” he noted. “The reforms I’m proposing go even further. We’ll reduce taxpayer subsidies to prescription drug companies and ask more from the wealthiest seniors.” (In time, I suspect that the administration also will call for a ban on those decidedly seamy “pay for delay” deals.)

“On Medicare,” he added, “I’m prepared to enact reforms that will achieve the same amount of health care savings by the beginning of the next decade as the reforms proposed by the bipartisan Simpson-Bowles commission.” The commission called for reducing Medicare spending by roughly $350 billion over 10 years– a sum that is not far from CAP’s $385 billion target.

Are These “Adjustments” Too Modest ?

These may seem like small numbers. But keep in mind that this is on top of the $950 billion that the Affordable Care Act (ACA) saves by squeezing waste out of health care spending, while simultaneously raising new revenues. Of that $950 billion, some $350 billion comes in the form of Medicare savings achieved by:

– Pruning over-payments to private sector Medicare Advantage insurers– $132 billion

– Containing Medicare inflation by shaving annual “updates” in payments to hospitals and other large facilities by 1% a year for ten years, beginning in 2014– $196 billion

– Cutting disproportionate share hospital payments to hospitals that care for a disproportionate share of poor and uninsured patients over 10 years beginning in 2014 – $22 billion.

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IRS ruling a ‘disaster for Obamacare?’ Not quite. Ruling may be ‘unfortunate,’ but it won’t leave ‘millions’ uninsured

Posted on February 6, 2013 by Maggie Mahar

Under the Affordable Care Act, Americans who are not offered “affordable” insurance at work can purchase coverage in the ACA’s health insurance exchanges, where many will be eligible for generous subsidies.

The law defines “affordable” as insurance that costs less than 9.6 percent of income. But the ACA doesn’t specify whether it is referring to individual coverage or family coverage, which is always far more expensive. The wording is ambiguous, an “oversight,” say many legislators.

Now the Internal Revenue Service (IRS) has ruled that the government will look at the cost of coverage for an individual – not a family – when deciding if a plan is “affordable.”

A disaster for Obamacare?

Earlier this week, Forbes ran a story about the rule under a headline that blared, “IRS Ruling to Create Millions of Uninsured Americans as It Undermines the Very Intent of Obamacare.”

Forbes’ take plays right into the conservative claim that Obamacare is a disaster. “We are now entering the crucial phase of the law’s enactment,” crows blogger Dwight L. Schwab, “and many critics are saying, ‘I told you so.’”

Whoa! Let’s look at Forbes’ argument, and the numbers.

Fear-mongering vs. facts

Forbes observes that, according to the Kaiser Family Foundation’s 2012 survey of employee benefits, on average, workers contribute $951 annually for an individual plan. But those buying family coverage fork over $4,316, “a number well in excess of the 9.5% of earnings for someone making just $35,000 a year.” Yet, under the IRS decision, “only the portion of the contribution attributable to the individual employee” can be “considered for the purpose of determining what is affordable – not the entire contribution.”

Forbes’ contributor Rick Ungar offers an example: If an employee who earns $35,000 and “is the sole breadwinner in the family” pays less than $3,325 annually for his own insurance … “nobody in the family qualifies for participation on the healthcare exchanges and nobody can qualify for the intended government subsidies.” If the employee signs up for a family plan with his employer it would cost “over 12 percent of their annual income … a crushing amount.”

“The result,” Ungar says, “will be millions of spouses and children left to go uninsured.”

Millions uninsured???

Let’s begin with that last sentence. Just how many children would be shut out? Bruce Lesley, president of First Focus, a children’s advocacy group, estimates that 500,000 children could remain uninsured.

A U.S. Government Accountability Office (GAO) report offers a similar estimate … that “460,000 children may be left uninsured if states stop funding the Children’s Health Insurance Program (CHIP) beyond 2015.” (Funding ends in 2015 because legislators assumed the ACA would protect kids.) “Federal funding could be extended,” the GAO notes. (My guess is that, if necessary, Congress would expand CHIP funding.)

But what about the mothers? If 500,000 children might be affected, that means that, at most, 500,000 mothers would be left uninsured. But in most of these cases, parents may well have have two children, sometimes more. Let’s assume that, on average, they have two children. That means 250,000 mothers (half of 500,000) might find themselves uninsured because of the IRS rule. Add those 250,000 mothers to a maximum of 500,000 children, and 750,000 people wind up “going naked” as insurers put it.

Married couples who don’t have children also should be counted. If only one spouse works, and they cannot afford the family plan his employer offers, another adult could be left out. But, these days, few married women under 65 who don’t have children stay at home. We’re still far from “millions.”

Forbes’ example

Forbes’ example of a single-breadwinner family is the exception, not the rule. Among families earning $25,000 to $60,000, 67 percent of mothers and 85 percent of fathers work.In these cases, couldn’t each parent purchase insurance through their employer?

Note: The post originally appeared on Healthinsurance.org To find the answer to that question, and why the Forbes Op-ed represents “fear-mongering, pure and simple”, please click here. If you like, come back here to comment.

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