The Changing Federal Landscape and the Impact on Coverage
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1 The Changing Federal Landscape and the Impact on Coverage HFMA Reimbursement Summit Christian L. Soura
2 Agenda Look back at 2017 s healthcare and tax proposals What did they do? What was the public perception? Revisit the individual mandate and other features of the ACA Take a look at the federal deficit and debt load Think about what this all suggests for the future
3 Recent History
4 November 8, 2016
5 November 8, 2016
6 Transition None of us really understands what s going on with all these numbers. -- David Stockman, OMB Director, 1981
7 Even harder with no game plan?
8 When in doubt, go with the one what brung ya
9 The Rise and Fall of the Individual Mandate
10 Brief refresher on the individual mandate
11 Brief refresher on the individual mandate
12 The medicine that makes ACA s sugar possible
13 The individual mandate, without singing [S]imply barring insurance companies from relying on an applicant s medical history would not work in practice. Without the individual mandate guaranteed-issue and community rating requirements would trigger an adverse-selection death-spiral in the health-insurance market: Insurance premiums would skyrocket, the number of uninsured would increase, and insurance companies would exit the market. When complemented by an insurance mandate, on the other hand, guaranteed issue and community rating would work as intended, increasing access to insurance and reducing uncompensated care. -- NFIB v. Sebelius, 567 U.S. 519 (Ginsburg/Sotomayor)
14 A package deal Individual Mandate 3:1 Age rating No lifetime limits Prevent services w/o co-pay No pre-ex Under 26 No annual limits
15 The individual mandate, reconsidered I am for people, individuals -- exactly like automobile insurance -- individuals having health insurance and being required to have health insurance. And I am prepared to vote for a voucher system which will give individuals, on a sliding scale, a government subsidy so we insure that everyone as individuals have health insurance. -- Newt Gingrich, 1993 I am completely opposed to the Obamacare mandate on individuals. I fought it for two and half years at the Center for Health Transformation. You can see all the things we did to stop it at HealthTransformation.net. I am for the repeal of Obamacare and I am against any effort to impose a federal mandate on anyone because it is fundamentally wrong and I believe unconstitutional. -- Newt Gingrich, 2011
16 At least changing positions is bipartisan "Hillary Clinton's attacking, but what's she not telling you about her health care plan?" the narrator in a Barack Obama campaign ad asks. It forces everyone to buy insurance, even if you can't afford it, and you pay a penalty if you don t. -- Obama campaign ad, April 2008 During the campaign I was opposed to this idea because my general attitude was the reason people don't have health insurance is not because they don't want it, it's because they can't afford it. And if you make it affordable, then they'll come. I am now in favor of some sort of individual mandate as long as there's a hardship exemption. -- Barack Obama, July
17 Repealed (sort of) CBO: 13M lose coverage by 2026, premiums rise 10%, $338B in federal savings
18 The Rest of the ACA
19 November 2016 polling on ACA components % with favorable opinion TOTAL D I R Under 26 on parents plans 85% 90% 85% 82% Preventive services without co-pay 83% 89% 83% 77% Close Medicare drug donut hole 81% 86% 89% 69% Insurance exchanges 80% 90% 80% 72% Subsidies for low/moderate income 80% 91% 81% 67% Optional Medicaid expansion 80% 90% 79% 67% Guaranteed issue / pre-existing conditions 69% 75% 65% 63% Medicare surtax for high-income earners 69% 82% 63% 63% Employer mandate 60% 83% 60% 45% Individual mandate 35% 57% 30% 21% Kaiser Health Tracking Poll: November 2016
20 Baby, bathwater? Obamacare should be repealed, root and branch. Many of us are here because we pledged to cast this very vote: to repeal and replace Obamacare.
21 Baby, bathwater? Obamacare should be repealed, root and branch. Many of us are here because we pledged to cast this very vote: to repeal and replace Obamacare.
22 Towards a GOP health care plan?
23 Common elements of GOP proposals in 2017 Eliminate the individual and employer mandates (35%, 60%) Change/reduce the purchasing power of marketplace subsidies (80%) Phase-out the Medicaid expansion (80%) Convert Medicaid to a per-capita budget Repeal most/all of ACA s taxes and divert savings (69%) Give states limited funding for reinsurance, etc. Weaken protections for pre-existing conditions (69%)
24 Common elements of GOP proposals in 2017 Eliminate the individual and employer mandates (35%, 60%) Change/reduce the purchasing power of marketplace subsidies (80%) Phase-out the Medicaid expansion (80%) Convert Medicaid to a per-capita budget Repeal most/all of ACA s taxes and divert savings (69%) Give states limited funding for reinsurance, etc. Weaken protections for pre-existing conditions (69%)
25 10-Year impact on U.S. health care spending CBO scores: 52486, 52516, 52752, 52849, 52941, 52939
26 10-Year impact on coverage (more uninsured)
27 10-Year deficit reduction ($ for other tax cuts)
28 The Public Reaction
29 Recent health care plans, in context Average Approval Clinton (1993), 40% ACA (2009), 44% GOP (2017), 23%
30 Health plan: Most underwater bill since
31 Recent tax bills (net favorable)
32 Tax bill: 2 nd most underwater bill since 1990 Tax cuts Tax hikes
33 But opinions are fickle?
34 And not necessarily well-informed?
35 And memories are short?
36 Budgetpocalypse Now
37 Federal debt now over $20T Source: Bipartisan Policy Center BPC projects reinstatement around $22T in March 2019, with extraordinary measures running into summer/fall.
38 The road ahead? (pre-tax bill, budget deal)
39 A lot more red ink since last year
40 Even worse if temporary provisions aren t
41 Divergence?
42 Squeeze Play
43 Step 1: CHIP reauthorization ~ $2B Source: CRS R43949
44 Step 2: Per-capita budgets for Medicaid?
45 Step 3: Graham-Cassidy?
46 Step 3: Graham-Cassidy?
47 Mixed Signals
48 Coverage programs are popular
49 And healthcare is important to voters (?)
50 Especially coverage issues
51 Where do we go from here? Individual mandate penalties disappear after 2018 Sets a new political and fiscal baseline for Graham-Cassidy, etc. The tax bill and budget deal will exacerbate the deficit and be used as the basis for further attacks against the safety net Commitments to stabilize the individual market are far from ironclad New regulations will undermine further AHPs, S/T limited plans, etc. Past promises to restart CSR payments haven t been worth much Broader interest in reinsurance but Hyde Amendment is the price? Medicaid work requirements, drug tests, lifetime limits?
52 What are the prospects for divided gov t? Chance of House majority Share of twoparty vote D R 53.6% 46.4% 54.2% 45.8% Seats
53 It s filing season!
54 The Changing Federal Landscape and the Impact on Coverage HFMA Reimbursement Summit Christian L. Soura
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