"Friends and foes of the Affordable Care Act (ACA) alike tend to
target the relative effectiveness of the (soon-to-be-repealed)
individual mandate as the key factor behind relatively higher levels of
insurance coverage since the law was enacted in 2010.
ACA supporters might wish that the mandate was much stronger, but
they still claim that its repeal will trigger rising premiums and leave
millions more Americans uninsured in the years ahead.
Many ACA foes often can’t decide whether repealing the mandate
remains the key to unraveling Obamacare or if it simply should be
eliminated as a matter of principle, regardless of the cost and coverage
consequences.
Spoiler alert: They were both wrong about the past. They are likely to remain mistaken about the future.
In reality, overall coverage gains under the ACA hit a modest, but relatively stable, plateau
well before last month’s tax-cutting budget reconciliation law decided
to eliminate further penalties under the individual mandate as of 2019.
Those initial reductions in the number of uninsured Americans were due primarily to expanded eligibility for Medicaid and, secondarily, to generous subsidies for lower-income enrollees in state-based health insurance exchanges.
The less-explored question involves why Obamacare’s overall
combination of taxpayer subsidies, expanded insurance programs, health
benefits requirements, AND coverage mandates had so much less of an
effect than the law’s architects envisioned.
It turns out that many of the nominally uninsured still have other
alternatives to health care than just through heavily-subsidized
Medicaid and exchange-based insurance. You might call such uncompensated
care either an option for “implicit insurance” or a hidden tax on acquiring more formal coverage.
Health policy researchers Amy Finkelstein, Neale Mahonem and Matthew Nolowidigdo unravel the puzzle in a recent National Bureau of Economic Research paper.
They explain why there is less “demand” than expected for the increased
“supply” of subsidized coverage for lower income individuals and more
limited take up of subsidized coverage than once predicted.
The bottom line is that the nominally uninsured (before and after
Obamacare’s implementation) pay only a small share (one-fifth to
one-third) of their medical expenses. Hence, they value formal health
insurance at substantially less than its full cost to insurers providing
such coverage.
Among the sources of other financing for care provided to the
uninsured are federal and state subsidies for uncompensated care, such
as Disproportionate Share Hospital (DSH) payments (reduced more
gradually and later than originally envisioned under the ACA), as well
as part-year insurance coverage, direct care programs, and private
donations.
The federal Emergency Medical Treatment and Active Labor Act
(EMTALA) also requires hospitals to provide “emergency care” to screen
and stabilize uninsured patients on credit. Nonprofit hospitals claim
provision of charity care as one of the primary ways to fulfill their
community benefit requirements for tax-exempt status. Retroactive
look-back coverage under Medicaid also has provided a further modest
financial cushion for some providers treating the nominally low-income
uninsured.
Keep in mind, too, that the accounting lines between charity care and
bad debt are far from clear cut, and they can be adjusted somewhat to
match the financial reporting needs of nonprofit versus for-profit
providers. Recovery rates for uncompensated care provided to low-income
uninsured individuals with few assets are limited (roughly 10-20 percent
at best) and further shielded by personal bankruptcy protections.
So, while financial and medical life for lower-income uninsured
individuals is far from comfortable or stable, Finkelstein, Mahonem,
and Nolowidigdo find that these various backup “options” do reduce the
willingness of low-income individuals to pay for the full --and in many
cases even the generously subsidized, out-of-pocket -- premium costs of
insurance coverage. For example, other research by Finkelstein estimates
that adults living below the Federal Poverty Level would be willing to
pay only 20 to 50 cents per each dollar of Medicare insurance coverage
spent on their “behalf,” and they would rather give up Medicaid than pay
the insurance costs of providing it." - The Real Hidden Tax on Increased Insurance Coverage, economics21.org, 01/25/2018
Link to the entire essay appears below:
https://economics21.org/html/real-hidden-tax-increased-insurance-coverage-2816.html
“Today, the Obama administration announced that it projected dramatically lower enrollment growth for Obamacare’s exchanges in 2016: only 1.3 million, compared to a prediction of 8 million when the law was passed five years ago.
The problem is fairly easy to understand. Obamacare imposed thousands of pages of new federal regulations on the market for private-sector health insurance purchased by individuals. These regulations mandated that all plans had to pay for a wide range of services, even if policyholders didn’t want them. They forced young people to pay double, and sometimes triple, what they had been paying before for coverage. And plans were required to provide higher financial payouts than they previously had to.
All of these bells and whistles cost money. And so, in 2014 alone, in the average U.S. county, Obamacare drove up the price of individually-purchased health insurance by 49 percent. In 2015 and 2016, additional double-digit rate hikes have been common throughout the country.
ACA enthusiasts disputed the significance of this problem, arguing that taxpayer-funded subsidies would compensate for the higher premiums. But there were always several flaws with that argument. First, subsidies don’t fall from the sky; they’re paid for by imposing additional costs on taxpayers. Second, the subsidies are only large enough for people whose incomes are near the poverty line. Those in the lower-middle class and above don’t receive subsidies that are large enough to compensate for Obamacare-induced rate shock.
In March, Caroline Pearson of Avalere Health published an analysis examining Obamacare enrollment relative to the number of people actually eligible for the law’s insurance subsidies. In a report entitled “Exchanges Struggle to Enroll Consumers as Income Increases,” she observed what should have been obvious in 2010: that those who are more exposed to Obamacare’s rate hikes—by being eligible for fewer subsidies—were not signing up.” - Flatlined: White House Says Obamacare Exchange Enrollment Growth To Collapse In 2016, Forbes, 10/15/2015
Link to the entire article appears below:
http://www.forbes.com/sites/theapothecary/2015/10/15/flatlined-white-house-says-obamacare-exchange-enrollment-growth-to-collapse-in-2016/
‘"Many of the non-poor formerly uninsured are estimated to be worse off," than without insurance, according to a September-dated working paper from the National Bureau of Economic Research titled "The Price of Responsibility: The Impact Of Health Reform On Non-Poor Uninsured."
How so? The subsidies are not large enough to offset the cost of the insurance premiums and the fact that many previously uninsured will now have to pay part of the cost to see a doctor, the report explains. The authors reached that conclusion after reviewing data for the uninsured prior to Obamacare, including age, gender, earnings and location. Then, they married that information with health-care expenditures for the group and used it to make estimates of out-of-pocket costs before and after the law went into effect.
The group of people whom the authors highlight are the non-poor, or those ineligible for Medicaid but who maybe eligible for various subsidies for premiums or cost-sharing, depending on their income level. It turns out that the more someone earns the worse off they'll be.’ - Obamacare is actually not so affordable -- unless you're broke. MSN news, 10/01/2015
Link to the entire article appears below:
http://www.msn.com/en-us/news/money/obamacare-is-actually-not-so-affordable-unless-youre-broke/ar-AAf0EKn?li=AAa0dzB
‘Some people who signed up for healthcare through ObamaCare may not have been qualified for the benefits they received, according to a government audit released Monday.
For several months after the rollout of HealthCare.gov, the government’s website was unable to verify important parts of a customer’s application, such as household income, citizenship status and family size.
The audit, which was completed by the Department of Health and Human Services’s inspector general, tracked sample applicants to determine weaknesses with the system's internal controls.’
‘“The Federal marketplace did not always maintain applicant data that were complete, accurate, and up to date in the eligibility and enrollment system and did not always maintain documentation supporting resolution of inconsistencies,” the 50-page report said.’ - Audit: Not all healthcare customers fully vetted by HealthCare.gov, the hill.com, 08/10/2015
Link to the entire article appears below:
http://thehill.com/policy/healthcare/250736-audit-not-all-healthcare-customers-fully-vetted-by-healthcaregov
‘Low- and middle-income consumers who use the marketplaces often are able to qualify for tax subsidies to offset the cost of monthly premiums and help them afford care. But while the Department of Health and Human Services has touted low premiums averaging $100 a month for the majority of Americans who use exchanges, that message only tells part of the story, leaving out details about copays, deductibles and provider costs that may be out of reach.
"There is a lot of evidence to suggest consumers are learning as they go, and I'm sure it's not without a lot of painful experiences," says Paul Lambdin, insurance exchanges and retail practice leader for health plans at Deloitte Consulting. The Deloitte Center for Health Solutions, a research arm of Deloitte, has been polling consumer attitudes about health insurance and the health care system since 2008.
For this report, researchers surveyed 3,887 people, 406 of whom used online marketplaces to buy health insurance. The analysis did not distinguish between people who used state exchanges and those who used the federal website, HealthCare.gov.
Despite having insurance coverage that some may not have had before, the survey revealed costs are still a major concern for exchange customers. Results showed only 24 percent felt they could get affordable care when they needed it, and just 16 percent felt financially prepared to handle future health care costs. And 1 in 3 reported they had difficulty paying for out-of-pocket expenses when enrolled in a marketplace plan for a full year.’ - Obamacare Exchange Customers: Health Care Still Costs Too Much, US News and World Report, 08/03/2015
Link to the entire article appears below:
http://www.usnews.com/news/blogs/data-mine/2015/08/03/obamacare-exchange-customers-health-care-still-costs-too-much
