“Setting The Stage”: What The Health Law Will Bring In 2013
Most of the really big changes made by the 2010 health law don’t start for another year. That includes things like a ban on restricting pre-existing conditions, and required insurance coverage for most Americans. But Jan. 1, 2013, will nevertheless mark some major changes.
One of those changes that will affect everyone with private health insurance actually took effect last September. But most people won’t see it until they renew or apply for new health insurance. It’s called a summary of benefits and coverage. The idea is to help people actually understand what’s in their insurance policies.
“One of the big complaints of people in polls or focus groups is that they just … don’t understand either the coverage or the price,” said Jay Angoff, a former official at the U.S. Department of Health and Human Services who worked on implementing the health law.
But with the new document, he says, “there’s a standard format that allows people to compare benefits to make apples-to-apples comparisons, not just on price, but on benefits.”
Health plans will also have to provide consumers a glossary of insurance terms if they ask for it.
“It’s still harder than some people would want,” Angoff says. “It’s still a complicated area. But I think HHS has really done a very good job in making it as simple and as meaningful as possible.”
Later in 2013 will also bring a key launch date for the law, says Angoff: “Oct. 1, 2013, is when open enrollment begins.”
That’s when people can start signing up for their 2014 coverage through the new health exchanges, or marketplaces, that the states and federal government are creating. Angoff, who used to head the office that’s in charge of building those exchanges, says he’s confident that things will happen on time.
“HHS has met all statutory deadlines on this until this point, and I have confidence that HHS will continue to meet those deadlines,” he said.
But the majority of what happens on Jan. 1 is to pay for the changes in 2014. In other words, tax increases and cuts in tax deductions. For example, starting next year, people will only be able to put $2,500 pre-tax into Flexible Spending Accounts that they use to pay for items insurance doesn’t cover.
“For example if they buy eyeglasses, if they pay copays on drug benefits or to their physician, they can submit those claims and be reimbursed from the pretax dollars,” said Marilyn Moon of the American Institutes for Research.
Moon says that while the change may hurt some people with very high out-of-pocket spending not covered by insurance, lawmakers decided this was a fair way to raise some of the money needed to pay for the rest of the law.
“This is a benefit that largely accrues to higher-income individuals who can afford to set aside a certain amount of money every year, to pay towards their health care spending,” she said.
There’s another tax change coming next year for the wealthy. Individuals earning more than $200,000 a year and couples earning more than $250,000 will see a nearly 1 percentage point increase in their Medicare payroll tax. They’ll also have to pay a 3.8 percent Medicare tax on their non-wage income. Moon says that represents a big change.
“The payroll tax usually applies only to wages, and now this law will extend it to investment income as well,” she said.
Those who take deductions for medical expenses on their income taxes will also see a change starting in 2013. Right now, expenses in excess of 7.5 percent of adjusted gross income are deductible. That’s going up to 10 percent for all except the elderly.
It will affect some people who spend a lot on medical care, says Moon. But the new law should also reduce the number of people with those very large bills, “because if everyone has health insurance, many fewer people should have to pay large amounts out-of-pocket on health care. Ten percent will not affect very many people, one would hope, when they get better insurance coverage.”
Finally, there’s a key change made by the health law for 2013 that will affect only the poor. Starting Jan. 1, state Medicaid programs will be required to reimburse doctors who provide primary care at Medicare rates, which are substantially higher. The idea is to get more doctors into the Medicaid program, which will itself expand in 2014.
The Medicaid increase, however, is only for two years.
By:Julie Rovner, NPR, January 1, 2013
“2012, The Year Of Conservative Absolutism”: The Republican Party Embraces An Inflexible And Combative Conservative Ideology
Between now and New Year’s Day, I will occasionally post thoughts about the big political phenomena of 2012. The biggest was the decision made the Republican Party’s rank-and-file and leadership to embrace an unusually inflexible and combative conservative ideology as it sought to topple an incumbent Democratic president and regain control of the Senate. In my opinion, this counter-intuitive approach had more to do with the ultimate results than any other single factor, including the Obama campaign’s great strengths and Mitt Romney’s personal weaknesses, and the thousands of daily events on the campaign trail we all talked about. The only thing that perhaps rivaled the unforced error of the GOP’s basic messaging was the steady if unspectacular improvement in the objective condition of the country–from the economy to national security to the first positive benefits of Obamacare–which made it easier for Democrats to make the election a clear choice of future policy paths.
It didn’t have to be that way. In Mitt Romney the GOP had a presidential nominee who would have been perfectly happy to campaign as a different version of himself, among the many versions he has presented over the years. Republicans did not have to choose a list of Senate candidates so bad–many either open extremists or former “establishment” GOPers afraid to risk conservative criticism–that they managed to lose seats in a cycle when big gains should have been relatively easy. The party’s dreadful performance among younger and minority voters was largely self-inflicted. Nobody made them raise reproductive rights as an issue, particularly in a year when their own pundits and candidates constantly insisted–as though mumbling to themselves–that “social issues” were off the table.
Yet there they were, as prospects for winning the White House and the Senate slipped away, stuck not only with absolutist positions on abortion and LGBT rights that have become increasingly universal in recent years, but with equally absolutist and unpopular positions on tax rates for the wealthy, economic stimulus, health care, climate change, and “entitlement reform.” By the time Romney tried to pose as a “moderate” in the autumn, praying for media complicity in presenting yet another dishonest self-portrait, it was too late.
Yes, demographic trends played a big role in the outcome, but given economic conditions and what might have been a serious falloff in turnout for Obama’s 2008 coalition, a less ideologically rigid GOP would have had a decent chance to prevail.
This is all worth reiterating because there are scarce signs of any Republican reconsideration of basic ideological positioning following the election. Sure, they’ll move partway back to the George W. Bush positioning on immigration–though not without savage internal dissension–and will probably shut up about marriage equality in most parts of the country. Institutions associated with the Tea Party Movement, and some of its leaders, may decline in popularity–not that it much matters insofar as that movement’s point of view has now been largely internalized by the “Republican Establishment,” as Steve Kornacki notes at Salon today. But even as the image of an extremist party continues to sink in, and even as demographic trends make a party of old white people even less attractive to the entire electorate, the prospect of “better” candidates and shrunken midterm turnout patterns will almost certainly prevent any real internal change.
So those of us who thought Barack Obama deserved a second term, and who were horrified by what a Republican White House and Congress might have done–by now we’d be looking right down the barrel of the Ryan Budget being rammed through Congress via reconciliation–owe a lot to the many ideological enforcers of the GOP who made even modest accommodations to political necessity so difficult. And despite the frustrating inability or unwillingness of some in the Beltway media to grasp the basics of asymmetrical polarization, the conservative movement’s constant aggressions convinced enough self-conscious “centrists”–from Thomas Mann and Norm Ornstein to yours truly–that something unsavory was going on in the Elephant Party which had to be repudiated. This enabled Obama and his highly competent campaign to lead a united coalition through thick and thin, and–who knows?–may now help him govern despite all the obstacles he now faces.
By: Ed Kilgore, Contributing Writer, Washington Monthly Political Animal, December 27, 2012
“Rejecting Their Own Ideas”: Republicans Are Creating Needless Difficulties For Themselves And The Country
We know that the House of Representatives has been unable to reach a sensible deal to avoid unnecessary fiscal trouble at the first of the year because of right-wing Republicans’ aversion to tax increases.
But there is another issue on which conservatives are creating needless difficulties for themselves and the country: It’s harder and harder for politicians on the right to think straight about health care.
Conservatives once genuinely interested in finding market-based ways for the government to expand health insurance coverage have, since the rise of Obamacare, made choices that are dysfunctional, even from their own perspective.
Start with the decision of the vast majority of Republican governors to refuse to set up the state insurance exchanges required under the law. The mechanisms would allow more than 20 million Americans to buy coverage. They were originally a conservative idea for large, trustworthy marketplaces where individuals and families could buy plans of their choice.
Many liberals preferred a national exchange, in which the federal government could institute strong rules to protect consumers and offer broader options. This was the path the House took, but the final Senate-passed law went with state-level exchanges in deference to Republican sensibilities.
To ensure that governors could not just prevent their residents from having access to the new marketplaces, the bill required the federal government to run them if states defaulted. So, irony of ironies, in declining to set up state exchanges, conservative governors are undermining states’ rights and giving liberals something far closer to the national system they hoped for. As Robert Laszewski, an industry critic of Obamacare, told The Post’s N.C. Aizenman, conservative governors are engaging in “cut-off-your-nose-to-spite-your-face” behavior.
This is one of many forms of conservative health-care unreason. The “fiscal cliff” debate has been distorted because the problems confronting federal finances are consistently misdescribed. We do not have “an entitlement problem.” We have a giant health-care cost problem.
Our major non-military fiscal challenges lie in Medicare and Medicaid. In principle, conservatives should seek to find ways of holding down health-care inflation in both the private and public sectors. In practice, they see most efforts to take on this issue system-wide as examples of big government run wild. They seem to have a vague idea that markets can yet solve a problem that markets have not been very good at solving.
The result is that conservatives would either let government get bigger, or they’d save money by throwing ever more risk onto individuals by undercutting core government guarantees.
Their most outrageous move was the big lie that the original health-care bill included “death panels.” This would have been laughable if it had not been so pernicious. The provision in question would simply have paid for consultations by terminally ill patients — if they wanted them — with their physicians on their best options for their care. Few things are more important to the future of health care than thinking straight about the costs and benefits (to patients and not just the system) of end-of-life treatments. For those of us who oppose physician-assisted suicide, it’s urgent to promote, rather than block, serious, moral and compassionate discussions of the difficult issues raised by high-tech medicine.
Or take the health-care law’s creation of the Independent Payment Advisory Board, known as IPAB. It’s a 15-member body charged with finding ways of cutting the costs of treatment under Medicare. Congress would have the final say, but through a fast-track process. Yet the ink was barely dry on Obama’s signature of the Affordable Care Act (ACA) when a group of Republican senators introduced what they called the Health Care Bureaucrats Elimination Act, to get rid of IPAB. Thus did an innovative effort to save money meet with a slap in the face. Conservatives barely acknowledge other cost-saving experiments in the ACA.
Is it any wonder that our fiscal politics are so dysfunctional? Yes, we liberals are very reluctant to cut access to various government health-insurance programs. With so many Americans still uninsured, we are wary of depriving more people of coverage. But we fully accept the need to contain government health spending.
Yet given the conservatives’ habit of walking away even from their own ideas (the exchanges, for example) and of rejecting progressive efforts to save money, is it any wonder that liberals suspect them of greater interest in dismantling programs than in making them more efficient? We won’t find genuine common ground on deficits until we resolve this dilemma.
By: E. J. Dionne, Jr., Opinion Writer, The Washington Post, December 26, 2012
“Another Anti-Obamacare Headline”: Beware The Great Health Insurance Scam Of 2014
The anti-Obamacare world is atwitter over comments made last week by Aetna CEO, Mark Bertolini, who predicts that some insurance markets will “go up as much as much as 100 percent” when Obamacare takes hold in 2014—with the average increases running between 25 percent and 50 percent in the small group and individual segments of the business.
Mr. Bertolini has dubbed this phenomenon “premium shock”.
To be sure, this is a great headline for those who remain committed to defeating the Affordable Care Act with nothing better to suggest in its place. However, the facts reveal that Bertolini’s comments—while just maybe true for a very few participants buying coverage on the exchanges in the individual markets—are completely misleading with respect to the individual markets and likely completely untrue as applied to the small group market.
So, how is Mr. Bertolini arriving at his dire predictions?
Apparently, it’s all about (a) the new tax placed on health insurance company sales, (b) the community rating requirements that now prohibit older participants in a health insurance pool to be charged more than 3 times what is paid by younger members and (c) the new minimum standard of benefits that will need to be provided to those who purchase health coverage on the exchanges.
Pretty scary, yes?
The problem with Mr. Bertolini’s prediction is that it is completely and utterly at odds with not only the Congressional Budget Office (“CBO”) projections but with American Health Insurance Plans (AHIP) —the very lobbying organization that represents Aetna and was an active and hugely important supporter of Obamacare.
In 2009, the CBO projected that the Affordable Care Act will have little impact on small and large group policies. This is notable given the expectation that, by 2016, the small group market will represent 13 percent of the total insurance market while large groups will provide coverage for a full 70 percent of Americans with health insurance coverage. Do the math and you find that, according to the CBO, 83 percent of all covered Americans will experience little to no change in premium rates beyond normal increases that would occur had Obamacare never become the law of the land.
As for the individual markets, which will comprise 17 percent of the overall insurance market in 2016, premium rates are predicted to rise about 10 to 13 percent by 2016—considerably lower than the doubling Mr. Bertolini has suggested will take place in 2014.
What’s more, approximately half of those gaining coverage in the individual market will qualify for the government subsidies, thereby reducing the price of their insurance premiums below where they currently exist.
Of course, it is not uncommon for people to discount CBO projections and proclaim them to be biased when the projections fail to meet a desired political narrative.
So, let’s see what Aetna’s own trade association, AHIP, has to say.
A review of the AHIP website reveals that the sales tax imposed on the health insurance companies—and sure to be passed along to consumers—will account for a premium increase averaging 1.9 percent to 2.3 percent by 2014 and 2.8 percent to 3.7 percent by 2023.
Now, you may object to this potential increase—but it is a long way from the increases Mr. Bertolini is predicting.
On the subject of community rating—where insurance companies will now be prohibited from charging older participants in their health insurance pools as much as 10 times more than what they charge younger members even if the elder participants have no pre-existing health problems—AHIP indicates that limiting the rates for the older participants to only 3 times the rate charged the young will result in some younger insurance customers paying as much as 45 percent more in premium payments while older participants will pay 13 percent less.
No doubt, this is a large part of what Aetna’s Bertolini is relying on when trying to freak out the public.
The problem with Bertolini’s prediction is that even this large percentage increase, should it prove to be actuarially accurate, would not apply in the small and large group markets- it would apply only to a very limited number of people purchasing their health insurance on the exchanges who are (a) very young and (b) not qualified for subsidies.
The number is also misleading in its severity.
According to AHIP, the average premium paid by a 24 year old in the individual marketplace is $1200 a year. Using AHIP’s numbers, the price of making the cost of heath insurance more equitable for a 60 year old will potentially cost that 24 year old, on average, an extra $45 a month.
While I don’t mean to minimize this increase, as I recognize that every dollar counts when one is young and getting started, it is important to keep the actual price tag in perspective and weigh the equities when considering that those at the older age range have been overcharged for many years.
The reality is that the young have been paying unreasonably low premium rates for for a very long time—it being in the health insurance company’s profit interest to bring in as many young and healthy people as possible in the door by charging artificially low rates. The problem is that they make up for it by charging artificially high rates to the older people the insurance company would rather not have in the first place. What the ACA seeks to do is correct this situation so that 60 year olds are not precluded from gaining health insurance coverage by being priced out of the market.
Note that this problem could have been averted for younger Americans had we lowered the Medicare age to 55 however this was not acceptable to the Congressional GOP.
And that brings us to the topic of minimum benefits that must now be including in insurance policies offered on the health care exchanges, another area where large increases can be found in the effort to alarm the public.
According to AHIP, the additional costs attributable to health insurance companies actually having to provide a meaningful benefit ranges for as little as a tenth of a percentage point in Rhode Island to 33 percent in Maine where, apparently, health insurance policies do not provide much in the way of actual coverage. And, again, these numbers apply only to the individual marketplace on the exchange.
Thus, if you are one of the 8.5 percent of Americans who will be buying your coverage on the exchange in the state of Maine (making for a very, very tiny percentage) you may now have to pay more to actually get some health care coverage in exchange for what you pay.
So, what does all this tell us?
Gary Klaxon, Vice President of the Kaiser Family Foundation—one of the few health care think- tanks that just about everyone agrees is completely non-partisan and objective, had this to say about Mr. Bertolini’s predictions:
“That just seems silly. I can’t imagine anything going on in the small-group market that would change the average premium that much. On the individual market, there’s arguments for things changing, but those magnitudes seem high.”
Silly, indeed.
There is, of course, more to this than what the anti-Obamacare folks are choosing to report.
That would be the part where Bertolini noted in his ‘premium shock’ comments that this huge, one-time jump in premium rates to be expected in 2014 also includes increases in costs that would come even without the health care reform law.
Translation—health insurance companies have been trying to raise rates at a ridiculous pace ever since the word ‘Obamacare’ first entered the American lexicon, always seeking to blame these increases on the law even before the law became the law. So, when 2014 arrives, you can be certain that they will do everything in their power to grab as large an increase as they can get away with in order to preserve their profits.
Mr. Bertolini is merely laying the groundwork for that effort as Obamacare has provided the health insurance industry with a wonderful scapegoat, perfectly suited and even more perfectly timed to cover the inescapable truth of health insurance—it is a business model whose time has passed.
The sooner the American public realizes that private health insurance companies no longer work, the sooner we can get busy with the solutions that, while politically uncomfortable, can actually solve the nation’s health care challenges.
In the meantime, if you are a part of a large or small business health insurance group, there is no reason to expect that there should be significant—if any— increases in your premium charges in 2014. If you are an individual who will be shopping for health insurance on the exchanges, the 50 percent of you that will qualify for subsidies should experience premium costs at a lower rate than what you are currently paying, If you are in that other half, you may, indeed, see some increase in your rate—but nowhere near the ‘doubling’ the insurance industry would like you to believe is in your future.
By: Rick Ungar, Op-Ed Contributor, Forbes, December 20, 2012
“Robert Bork’s Legacy”: The Prototype For Republican Entrenchment And Obstruction
Judge Robert Bork has died. But the tradition started by his failed 1987 nomination to the U.S. Supreme Court has sadly become entrenched.
Bork was a conservative hero and a threat to liberals. His nomination to the high court was thwarted not because of his intellectual fitness for the bench, but for his views and lower-court rulings on issues ranging from civil rights to abortion. In a famous address, the late Sen. Edward M. Kennedy warned of the specter of “Robert Bork’s America,” a world in which civil rights and women’s rights were imperiled.
Kennedy was not wrong in his assessment of Bork; nor was he wrong in opposing the nomination of a man who threatened to roll back hard-won advancements in social policy. The senator was criticized for politicizing a Supreme Court nomination, but the same charge could have been made against President Reagan for nominating someone with such a clearly conservative agenda. The trouble is that since then, an ideological witch-hunt has been imposed on a slew of nominees—even those for much less prestigious positions and nonlifetime appointments. The nomination of Donald Berwick, a widely respected physician and health policy maven, was stymied by Senate Republicans who said Berwick shouldn’t head the Centers for Medicare and Medicaid Services because he believed in some version of socialized medicine. The evidence for that was sketchy, based on comments Berwick made praising Britain’s National Health Service. In reality, conservatives just wanted to slow down the implementation of Obamacare while they fought it (unsuccessfully) in court.
Then there was Peter Diamond, who ultimately withdrew his nomination to the Federal Reserve amid threats of a filibuster by GOP Sen. Richard Shelby. Shelby expressed concerns that Diamond’s economic background was not the right sort for the Fed. The Nobel Prize committee had disagreed, awarding Diamond its prize in Economics.
Now, senators are sending subtle threats about putting a former colleague, Chuck Hagel, through the wringer if President Obama nominates him to be Defense Secretary. Hagel is a respected former Nebraska senator, a two-time Purple Heart winner, and was known as an expert on military affairs when he was in office. It’s also a gesture of bipartisanship for Obama to consider someone from the other party to be in his cabinet. But to some lawmakers, Hagel has not been sufficiently toady-like in his allegiance to Israel—actually, his allegiance to the Israeli lobby. The fact that Hagel served his own country in Vietnam and in the Senate seems to have taken a back seat.
Bork may well have been a poor addition to the Supreme Court. But thwarting nominations for the sake of frustrating a sitting president in the other party is the worst legacy his nomination has left.
By: Susan Milligan, U. S. News and World Report, December 19, 2012
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