What the ACA Intended ~16 Mil to Exchanges ~16 Mil to Medicaid 42 Million Uninsured
What Actually Happened as of January 1, 2016 9.1 M to Exchanges Only an estimated 5.4M 6.6M were previously uninsured 8.9 M to Medicaid 26 Million Uninsured Remaining http://www.forbes.com/sites/theapothecary/2015/10/15/flatlined-white-house-says-obamacare-exchange-enrollment-growth-to-collapse-in-2016/#27e950ef6eff http://www.bloombergview.com/quicktake/obamacare-assessed; http://acasignups.net/spreadsheet-med
Less Than 6 in 10 in Exchange Plans were Previously Uninsured Uninsured, 57% Covered by a different non-group plan, 16% Covered by Medicaid or other public program, 9% Covered by an Employer/COBRA, 14% Other/Don t Know/Refused, 4% Source: Kaiser Family Foundation Survey of non-group health insurance enrollees, conducted April 3 May 11, 2014
The Good of the ACA
17 million Americans enrolled as a result of the ACA (net total) Source: RAND, May 2015, http://www.rand.org/news/press/2015/05/06.html
Uninsured Rate at 11.9% - From a High of 18%
Some Employers are Increasing Coverage Extending it to Employees not Previously Eligible Source: Health Insurers Struggle to Profit From ACA Plans, Wall Street Journal, 11/1/15
Medicaid by the Numbers 59 million in Medicaid before ACA 72 million in Medicaid Today (more than 1 in 5 Americans) 31 States + DC participated in Medicaid Expansion 26 expanded via traditional Medicaid, 6 used alternative plan 2 additional States (Ala. & SD) are considering expansion http://kff.org/health-reform/issue-brief/medicaid-moving-forward/; http://kff.org/medicaid/issue-brief/how-is-the-aca-impacting-medicaid-enrollment/; http://kff.org/health-reform/state-indicator/total-monthly-medicaid-and-chip-enrollment/
10 States with the Largest Reductions in number of Uninsured States with both Medicaid Expansion AND state-run exchange fared best
Where the ACA Fell Short
Where the ACA Fell Short Gaps in coverage remain ACA failed to address cost High deductibles and increased outof-pocket costs Exchange plans not profitable marketplaces may not be sustainable
States that Opted Not to Expand Medicaid Have Higher % Uninsured Source: Kaiser Family Foundation, March 2016, http://kff.org/health-reform/slide/current-status-of-the-medicaid-expansion-decision/
South, Southwest & Mountain West = Highest Uninsured Rates Source: Gallup-Healthways Well-Being Index, http://www.well-beingindex.com/arkansas-kentucky-reduce-uninsured-rate
Regional Uninsured: AL, FL, GA, SC, TN Distribution of Nonelderly Eligibility for ACA Coverage Among Remaining Uninsured as of 2015 None of these states have expanded Medicaid All have GOP governors Source: KFF, January 2016, http://kff.org/uninsured/issue-brief/new-estimates-of-eligibility-for-aca-coverage-among-the-uninsured/
What to Expect: Medicaid Expansion 31 States + DC participated in Medicaid Expansion 2 additional States (Ala. & SD) considering expansion Prediction: 2-3 will expand over next 2 years Incentive to expand before federal subsidy declines to 90% by 2020 Whether additional states choose to expand will depend on who is elected President and how he/she handles ACA
What to Expect: Managing Medicaid Costs Move to MCOs: 39 states contract with managed care organizations (MCOs) to serve at least some Medicaid beneficiaries. Over 50% of Medicaid beneficiaries get their care through MCOs. Prediction: States will increasingly partner with MCOs to reduce costs as federal subsidy declines from 100% to 90% by 2020. First cut comes in 2018, declines to 95%.
The ACA has increased healthcare coverage. However, increased coverage access to quality care or reduction in healthcare costs.
Only a Few Years in, ACA Already Estimated to Cost $300 Billion More CBO 10-Year Cost Estimate for ACA = $1.2 Trillion PROMISED 10-YEAR COST $900 Billion CBO PROJECTED COST, 2016-2025 $1.2 Trillion 0 200 400 600 800 1000 1200 Billions Source: Insurance Coverage Provisions of the ACA CBO s March 2015 Baseline, Congressional Budget Office, https://www.cbo.gov/sites/default/files/51298-2015-03-aca.pdf
Expect ACA costs to continue to grow as Congress delays or repeals the revenue sources (taxes) in the Act Case in Point: The Cadillac Tax
The Cadillac Tax Congress passed a two-year delay of the tax from 2018 to 2020, as part of a Dec. 2015 budget deal But few on either side of the debate think the Cadillac tax will ever go into effect, with such a powerful bipartisan contingent opposing it (it s opposed by both the labor unions and the Chamber of Commerce) Even Hillary and Bernie have come out against it! Source: Are Democrats crippling Obamacare? Politico, 12/28/15
Access to Insurance Access to Care Not all providers take these new plans or traditional Medicaid The cost of Premiums is rising because of Minimum Coverage and the Cadillac tax Insurers cannot control costs by controlling who and what they insure, so cost-sharing has increased This results in higher deductibles. High deductibles can lead to care avoidance: Only Platinum and Gold Plans have deductibles under $2000 but these come with higher premiums
The Problem: High Deductibles & Increased Out-of-Pocket Costs Deductibles are as high as $5000 to $6000 As much as 40% of Americans cannot afford a $2000 out of pocket medical expense In addition to being uninsured, being underinsured is becoming a reality for many Americans
Catastrophic Only Insurance
Approximately 35% of Working-Age Americans Struggle with Medical Debt
Affordability will continue to be an issue on the individual marketplaces because insurers have been losing money on exchange plans, and have been raising rates or reducing coverage options to compensate
Health insurers lost a total of $2.5 billion, or on average $163 per consumer enrolled, in the individual market in 2014, McKinsey & Co. found in a new report. Now, a lot of insurers are recalibrating their approach for 2016. Source: Health Insurers Struggle to Profit From ACA Plans, Wall Street Journal, 11/1/15
Here in Tennessee, the state insurance commissioner approved a 36% rate increase for the largest health insurer in the state s individual marketplace, BlueCross BlueShield. BCBS lost $141 million in the first year of offering individual health plans through the ACA. Source: http://www.timesfreepress.com/news/local/story/2015/may/31/insurers-proposehefty-rate-increases/307112/
Are the ObamaCare Marketplaces Sustainable? Jan. 2016: AETNA the nation s 3 rd largest insurer said it had serious concerns about the sustainability of the public exchanges Dec. 2015: BCBS which is the leading provider in many state exchanges said The current risk pool is out of balance. A course correction is needed now or this unsustainable trend will only get worse in the future. Nov. 2015: United HealthCare the nation s largest insurer said that its losses on the ObamaCare marketplaces might cause it to drop out of that market altogether in 2017 Source: http://thehill.com/policy/healthcare/267740-aetna-serious-concerns-on-obamacare-sustainability Are Democrats crippling Obamacare? Politico, 12/28/15
What s next for the ACA? My Prediction for Washington
ObamaCare and the Next President All GOP: against the ACA. Trump would end individual mandate, create tax deduction for individuals insurance, and allow insurance to be sold across state lines. Cruz led efforts to defund and repeal the ACA in the Senate. In contrast, Kasich expanded Medicaid as Gov. of Ohio. Under a Dem president, the ACA is here to stay. Clinton has said the ACA is too important to turn the clock back. Suggested she s open to different ways of achieving the health law s goals, praising states like Arkansas that expanded Medicaid coverage using federal money to buy private insurance.
The Delegate Race
For the GOP, a Brokered Convention?
House: GOP Too Gerrymandered To Fail Source: Mehlman Castagnetti Rosen & Thomas, March 2016
Senate: Majority at Risk Source: Mehlman Castagnetti Rosen & Thomas, March 2016
Senate Outcome Likely Hinges on Presidency Source: Mehlman Castagnetti Rosen & Thomas, March 2016
What Changes Could a Dem Administration Make? 1. Repeal the Cadillac Tax (both Hillary and Bernie support repeal) 2. Create a public option to be offered on individual state exchanges under an ACA waiver goal would be to help address rising premium costs on exchanges and compete with private insurers 3. Offer a tax credit to offset cost of high deductibles for families 4. Provide the Medicaid expansion holdout states with more flexible options to qualify for the federal funds 5. Extend exchange plans to undocumented immigrants, potentially as a part of comprehensive immigration reform
What Changes Could a GOP Administration Make? 1. Repeal the Cadillac Tax (LIKELY) 2. Repeal the Individual Mandate and Subsidies 3. Replace with Refundable Tax Credit and an expansion of High-Deductible Health Savings Accounts 4. Permit the sale of health insurance across state lines 5. Promote re-establishing State High-Risk Pools for individuals with pre-existing conditions 6. Convert Medicaid to Block Grants Souce: http://healthaffairs.org/blog/2015/09/18/what-would-republicans-do-instead-of-the-affordable-care-act/
However, a Republican President or Congress would struggle with repealing these popular, entrenched provisions: Popular: Coverage for young adults up to age 26 Elimination of pre-existing condition exclusions Elimination of lifetime and annual benefit caps Medicaid expansion (in states where it s occurred) Entrenched: Insurance exchanges Premium and cost sharing subsidies Source: http://healthaffairs.org/blog/2015/09/18/what-would-republicans-do-instead-of-the-affordable-care-act/
For Now, ObamaCare is Here to Stay 17 million Americans have insurance through the exchanges and Medicaid expansion now Unclear how many of these were previously uninsured, but that is less important than that they now have this new product Republicans will continue to attempt a token repeal of the ACA, but it will fail Of Note: Speaker Ryan pledged to put forward repeal and replace legislation this year
Through the Crystal Ball: Future Trends in Healthcare Reform
Through the Crystal Ball: Future Trends in Healthcare Reform 1. Providers and Patients will demand transparency from insurance companies, hospitals and physicians. This will become an expectation for service and drive non-participants from the market.
PRICE will become a part of EVERY patient-provider interaction. This will require: Change in the Culture of Medicine Opportunity for new tools for Providers
Variation in Cost of Knee Surgery http://www.usatoday.com/story/news/2015/01/21/blue-cross-blue-shield-knee-hip-surgery-rates-vary-widely/21999929/
2. PATIENTS will take a more active role in lowering costs: RISE OF CONSUMERISM Through programs directed by insurance companies. Self-directed due to choice on how to spend deductible dollars
Case Study: : MDSave
How it Works: For the Consumer
Through the Crystal Ball: Future Trends in Healthcare Reform 3. We will see the rise of different service models that are inherently transparent and value-based
Telemedicine is Transparent and Value-Based Telemedicine revolutionizes how consumers use the healthcare system by delivering remote access to affordable, high quality care when, where, and how each patient chooses. Timely access Lower, upfront cost Quality care
A Case Study: Teladoc
Patients are Satisfied with Teladoc 92% PATIENT MEDICAL ISSUES RESOLVED 8% UNRESOLVED: Unresolved were: referred out of scope for telehealth seeking meds only sent to the ER
Through the Crystal Ball: Future Trends in Healthcare Reform 4. Value-Based Care will drive lower cost interventions to achieve better outcomes. Managed Care + Outcomes Measures
Transitioning to Value-Based Care: Government Showing Leadership toward Value January 2015: Secretary Burwell announced plan to transition Medicare from fee-for-service medicine to value-based care. By end of 2016: Goal to shift 30% of Medicare FFS payments to value-based care. By end of 2018: Goal to shift 50% of Medicare FFS payments to value-based care. This is an historic move for HHS.
The Take Home: ACA Reduced Uninsured, But Cost Problems Remain: The ACA has expanded coverage, but has not succeeded in reducing costs, or fully addressing access issues. Empower the Patient-Consumer: With healthcare costs continuing to rise, and patients paying more out of pocket, the consumer MUST be empowered to comparatively shop for lower-cost (higher value) care. This will require price and accessible outcome data. Change How We Pay & When/Where We Intervene: To bend the cost curve, we will change how we pay for care (value-based care, managed care). We also must aggressively address the key determinants of our health outcomes our health behaviors and the best settings to shape and change those behaviors. At 5 years, the ACA is here to stay. But regardless of the elections, success for America can be achieved with substantial modification with patient-centered, knowledge based, and value-driven principles. And that is our call to action! a