Friday, October 24, 2014

ACA/Obamacare: Same Zebra with the Same Stripes?

‘If there is one thing Republicans and Democrats agree on it’s this: Obamacare represents a radical change in the US health care system. Soon after its passage, some on the left declared that we had created a right to health care for the first time in our history. Some on the right predicted death panels and a march toward socialized medicine.

But what if they are all wrong?

Is it possible that we could spend $2 trillion over the next ten years, create hardship and anxiety for millions of families who already had health insurance they liked, cause buyer’s remorse for millions of newly insured, cause almost every business in America to change its employee benefits and at the end of the day accomplish not much of anything?

Yes that’s possible.

What brings this to mind is a new report by the inspector general at the Department of Health and Human Services. As summarized in The New York Times:

“… the Obama administration and state officials have done little to ensure that new beneficiaries have access to doctors after they get their Medicaid cards….”

“The report … says state standards for access to care vary widely and are rarely enforced. As a result, it says, Medicaid patients often find that they must wait for months or travel long distances to see a doctor.” ‘

‘The same problem arose under Romney Care. When he was governor, Mitt Romney told me that once people were insured, they would go to physicians’ offices rather than hospital emergency rooms. They would get less expensive care and more appropriate care as a result, he said.

There were two problems with that prediction. First, Romney Care didn’t create any new physicians’ offices. Second, the newly subsidized private insurance didn’t pay that much more than Medicaid. Bottom line: patients in Massachusetts are largely going to the same places they went before Romney Care. Emergency room traffic is higher than ever. The traffic to community health centers has changed very little. For reasons I don’t understand, those with newly subsidized private insurance have more difficulty seeing a doctor than patients on Medicaid. And waiting times in Massachusetts are the highest in the country. In Boston, the wait to see a new doctor is about two months!

Under Obamacare, things are likely to be even worse. Not only does the health reform law not create any new doctors, it will shrink the supply of doctor services as more physicians retire early (discouraged by a new raft of rules and regulations) and more of them become hospital employees (where they work nine to five and play golf on the weekends). At the same time the law will greatly expand the demand for care by the relatively healthy. Millions of senior citizens are now entitled to an annual wellness visit (of no medical value according to almost every expert) and everyone with private insurance will be entitled to a long list of preventive procedures (almost all of questionable medical value), with no copayment or deductible.

Giving preventive care to healthy patients is time consuming and it crowds out access by those who have genuine medical problems. In fact a Duke University study estimated that fulfilling the promise of preventive care to all Americans would consume almost the totality of the average doctor’s day.’ - What if Obamacare Doesn't Change Much Of Anything?, Forbes, 10/06/2014

Link to the entire article appears below:

Wednesday, October 22, 2014

ACA/Obamacare: Cancellations and Confusion in Colorado

“DENVER—The Colorado Division of Insurance announced Friday a surge in health-care policy cancellations in the wake of Obamacare, just what Democratic candidates in high-profile races didn’t need less than three weeks before Election Day.

In a letter to state Senate Republicans, Colorado insurance commissioner Marguerite Salazar said that more than 22,000 Coloradans received cancellation notices in the last month, and that 192,942 Coloradans will lose their policies at the end of 2015.

That would bring the total number of cancellations in Colorado to more than 550,000 by the time the Affordable Care Act has been fully implemented and non-compliant plans have been phased out. Ten Colorado carriers have opted to continue offering non-compliant plans through 2015, Ms. Salazar said.”

“A RAND Corporation report issued earlier this week found that there was “significant confusion and little understanding about Medicaid and private insurance subsidies through Connect for Health Colorado,” the state-run exchange.

Barriers to enrollment included “mistrust” of the system and “unfavorable attitudes toward the individual mandates,” despite the exchange’s $21 million marketing effort.” - Health care cancellation avalanche hits Colo. Democrats weeks before election, The Washington Times, 10/17/2014

Link to the entire article appears below:

Tuesday, October 14, 2014

ACA/Obamacare: The Affordable Care Act and the New Economics of Part-Time Work by Casey Mulligan

“Starting this year, the United States’ working population will face three major employment disincentives resulting from the very benefits the Affordable Care Act (ACA) provides: (1) an explicit tax on full-time work, (2) an implicit tax on full-time work for those who are ineligible for the ACA’s health insurance subsidies, and (3) an implicit tax that links the amount of available subsidies to workers’ incomes.

A new study published by the Mercatus Center at George Mason University advances the understanding of how much these ACA taxes will reduce overall employment, and why. It concludes that the reduction will be nearly double that projected by previous analyses. Labor markets ultimately will reduce weekly employment per person by about 3 percent—translating to roughly 4 million fewer full-time-equivalent workers.” - Mercatus Center, George Mason University, 10/07/2014

Link to the working paper by Casey Mulligan:

ACA/Obamacare: Covered California’s No-Bid Contracts

“California's health insurance exchange has awarded $184 million in contracts without the competitive bidding and oversight that is standard practice across state government, including deals that sent millions of dollars to a firm whose employees have long-standing ties to the agency's executive director.

Covered California's no-bid contracts were for a variety of services, ranging from public relations to paying for ergonomic adjustments to work stations, according to an Associated Press review of contracting records obtained through the state Public Records Act.

Several of those contracts worth a total of $4.2 million went to a consulting firm, The Tori Group, whose founder has strong professional ties to agency Executive Director Peter Lee, while others were awarded to a subsidiary of a health care company he once headed.”

“The founder of The Tori Group, Leesa Tori, worked under Lee when she was a senior executive at Pacific Health Advantage, a small business insurance exchange that failed in 2006. Lee was a longtime chief executive of Pacific Business Group on Health, which managed Pacific Health Advantage, and Tori also worked with him at the parent company.

Long before it opened its doors to the public last fall, Covered California awarded a small contract to Tori for her advice on designing a program to sell insurance to small companies. The $4,900 agreement in late 2011 was executed without rival bids.

The deal would mark the beginning of a lucrative and far-reaching partnership between the agency and the company Tori formed about two years ago, just as national health care reform took root across the U.S. An initial $150,000 contract with The Tori Group in March 2013 was executed by Lee, but later amendments that increased its value to $4.2 million were approved by Covered California's board, an agency statement indicated.

Nearly three years after her first, small contract went into effect, she and employees at her firm hold senior-level positions and work on issues ranging from enrollment to health plan design at Covered California.

At least five other people who are contracted to work at Covered California have ties to the now-defunct Pacific Health Advantage, four of them at The Tori Group, whose employees are paid through the consulting contracts. In all, nine people listed on the group's website, in addition to Tori, work at the exchange.

Yolanda Richardson, Covered California's chief deputy executive director who reports directly to Lee, was a vice president at Pacific Health Advantage. Before she was hired on staff, she received a 10-month, $176,500 no-bid consulting contract from the agency in 2011, about a month before Lee came on board, according to the records.” - AP Exclusive: California Gives No-Bid Health Pacts, 10/12/2014

Link to the entire article appears below:







Saturday, October 11, 2014

ACA/Obamacare: Schemes Tend to be Complicated and to Become More Complicate as Time Passes

Assume for a moment you are one of the many millions that have already procured an on-exchange health insurance policy through Yes, assume for a moment you were one of the persistent people that had the patience to pass through seventy six web-based pages of data collection on a highly glitch prone web site and acquired a health insurance policy. One would assume you weathered the storm, made a gallant effort and now there is nothing but blue skies ahead. Congratulations are in order, right? Maybe not so much. How so?

Now it’s renewal time and the yellow brick road forks. Here are several items one will encounter at the fork in the road known as open enrollment renewal:

(a) as one approaches open enrollment renewal, the directional sign is blank at the fork in the road . One will not be able to know plan prices or plan availability until 11/15/2014 which is the first day of open enrollment (and a politically convenient date falling after the mid-term elections), (1)

(b) one’s current plan selected on-exchange at, for a multitude of reasons, may no longer be available. Yes, do not pass go, do not collect two hundred dollars and merely start all over again by searching for a plan, (2)

(c) your plan may still be available but the price has risen in a substantial manner. If the price rise is extreme, merely start all over again by searching for a plan, (3)

(d) if one was/is receiving a subsidy then income must be projected again in regards to subsidy eligibility. One must further consider the change in price of the second lowest silver plan price now available upon the exchange, which is a determinant of subsidy, and then considerer the new price of the second lowest silver plan in relation to the plan one considers selecting, (4)

(e) one might do nothing. Huh? That’s right, if you already have an on-exchange health insurance policy through, and if the plan is continued, and you do nothing you are automatically re-enrolled. Sweet! An easy way out! Nada. The plan may continue and yes one is re-enrolled, but the price has likely changed upward. If one is receiving a subsidy and since one did nothing, one’s income was not re-projected and the new price of the second lowest silver plan in relation to the new price of the old plan you selected (automatically re-enrolled) still holds as a determinant, so your subsidy likely remains the same while your plan’s price rises substantially and one ends this zero effort exercise with a nasty premium increase, (5)

(f) meanwhile the process outlined above needs initiated between 11/15/2014 and 12/15/2014. Renewal open enrollment is a thirty day window and is not the same as the open enrollment period for new comers which is 11/15/2014 to 02/15/2015. (6)

Happy holidays! One might consider that holiday shopping after 12/15/2014 and don’t be late for Thanksgiving dinner!



(1) Next edition of is unveiled,, 10/08/2014



(2) ACA/Obamacare: Why Your Old Plan Got Cancelled and Why Your New Plan Is Likely to be Cancelled Too.



(3) (4) How Automatic Renewal Could Cost Obamacare Enrollees, WJS, 07/02/2014


(5) (6) Next edition of is unveiled,, 10/08/2014









Thursday, October 9, 2014

ACA/Obamacare: California Proposition 45

"Californians are split over a high-profile voter initiative that opponents say could complicate the future of President Barack Obama ’s health-care law in one of the states that has gone furthest to embrace it.

Proposition 45 would grant California’s insurance commissioner new powers to veto health-insurance premium increases for individual and small-group policies, a popular sentiment in a state that has seen large rate jumps in the past, though they have recently moderated.

Some prominent Democrats, including Sens. Dianne Feinstein and Barbara Boxer, have endorsed the measure, which would also grant citizens and outside groups the power to delay health-insurance rate increases by requesting a government review.

The measure is strongly opposed by health insurers, who have donated tens of millions of dollars to defeat it. Opponents say the measure could hamper efforts to further implement the health-care law in California, which spent more time and money than any other state building its insurance exchange, Covered California. They say Covered California’s power to negotiate with insurers on behalf of consumers would be weakened, and that federal subsidies could be hard to price for many of the low-income people who dominate the exchange.

“It starts to raise very serious questions about the certainty of what Covered California will be able to negotiate with the insurance companies…and even whether some plans will be available,” said Rep. George Miller (D., Calif.), one of the Affordable Care Act’s co-authors. “The problem is Prop 45 was written before we got to the final stages here” of the ACA.

Prop 45 was originally drafted for the 2012 election, but the measure failed to qualify for the ballot in time. Since then, Covered California has become the most robust exchange in the country, signing up 1.4 million people during the last enrollment period.

The new powers under Prop 45 would broadly enhance the influence of Dave Jones, the Democratic state insurance commissioner. Since taking office in 2011, he has said that a missing piece of the health law was the lack of authority to reject insurance rate increases."

- Californians Split Over Letting Official Veto Insurers’ Rate Boosts, WSJ, 10/09/2014
Link to the entire article appears below: