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Employers expected to keep some of health law's popular provisions, even if Obama loses

Published: Tuesday, November 06, 2012 @ 10:36 AM
Updated: Tuesday, November 06, 2012 @ 10:36 AM

No matter who wins the presidential election, most workers who get health insurance through their jobs won't see a lot of immediate changes in their health benefits.

Employers will continue looking for ways to cap expenses, moving toward higher deductible policies, or placing limits on how much they pay toward their workers’ premiums -- both trends that predate the federal health law, analysts say.

Many employers have also embraced some of the more popular rules in the federal health law, such as no copays for certain cancer screenings and preventive care, and allowing parents to keep their adult children on their policies until age 26.

Employers have "experimented with (those ideas) for the better part of a decade now," says Paul Fronstin of the Employee Benefit Research Institute in Washington D.C.  "There’s no going back."

Still, the law itself may be affected by whom the electorate chooses to send to the White House and Congress next year, in ways that could make big differences over time.

Republican nominee Mitt Romney has promised to repeal the law if elected, although it is uncertain he would have the congressional votes to do that, or how long such efforts might take. Some provisions, such as federal subsidies to help some people buy coverage in new insurance marketplaces, would likely fall by the wayside if major parts of the law were dismantled, for instance.

In contrast, the re-election of President Barack Obama would mean the major provisions of the law will likely go into effect as planned in 2014, including rules that require employers with more than 50 full-time workers to offer health insurance or face fines starting at $2,000 a worker if they get federal subsidies to help them buy coverage. Employers would also need to ensure their coverage meets affordability standards and give workers easy-to-understand descriptions of their benefits.

While a host of rules have already been issued, employers say they are still waiting for some, including final word on how to design employee wellness programs, how to report worker eligibility for coverage and whether all workers must be given the same benefits.  Tracy Watts, a senior consultant with Mercer, says employers "have a lot of questions to be addressed" and expects a flurry of regulations in the next few weeks, no matter who wins the election.

'Big Fear Is … Uncertainty'

Consultants say a Romney win would raise a host of questions among employers who have begun to prepare for the law. Would it be repealed entirely? Or, as many observers expect, would Congress attempt to amend it, and if so, which parts?

"The big fear is one of uncertainty, not knowing what would happen, how it would work," says Gretchen Young, senior vice president for health policy at the ERISA Industry Committee, which represents large employers.

One big focus for employers would be whether Congress would change rules already in effect that bar health insurers from setting lifetime limits on insurance policies. Previously, such limits were seen as one way to hold down premium costs, but also caused some people stricken with serious illness to suddenly find themselves cut off from coverage when they hit the limit. 

"If the law is repealed, we may see employers reintroducing annual limits or lifetime limits," says Fronstin.

The law includes other provisions affecting employers and employees that might be changed or eliminated under a Romney administration. Starting in 2014, individuals and small businesses are supposed to be able to shop for and enroll in coverage and determine eligibility for federal subsidies, through state-based marketplaces, called exchanges.

In addition to the online exchanges, the law provides tax credits to help some small businesses purchase coverage.  Individuals earning less than about $44,680 who don’t get coverage through their jobs could also qualify for sliding scale subsidies to help them buy through the exchanges.

Some small business groups, such as Small Business Majority, support the law, saying the exchanges could boost competition, potentially easing volatility in premiums, and providing workers with greater choice of insurance carriers.  Even so, rules setting essential health benefits and capping the amount small businesses can charge workers in annual deductibles could raise costs for some employers. Other groups, including the National Federation of Independent Business, oppose the law, saying its requirements are burdensome.

Success of the exchanges, however, will depend on how many people and businesses use them.  Too few enrollees could drive up premiums if those who choose to enroll are sicker or older than those who sit out.  

And subsidies will be key to getting people to enroll through the exchanges, experts say.  Such funding, however, is expected to be a target of the law’s opponents.

"I don’t think people are convinced that Romney would repeal the whole thing, but certainly huge swaths of funding could be taken out," says Young. "If you take out the subsidies, then the exchanges won’t gain a toehold and may well collapse."

Most Employers Expect Higher Costs

Premium costs will be another key factor in enrollment in the exchanges. The Congressional Budget Office has estimated that premiums for big employers will be a little lower under the law, while costs for small businesses will remain about the same. Individuals will see higher premiums, mainly because coverage will be more comprehensive. For some individuals, the CBO said the additional cost would be offset by subsidies.

A survey by consulting group Mercer released in August found that 60 percent of the 1,200 responding employers expected some cost increase from the law in 2014.  Watts says those costs are mainly related to having to cover more workers – including those employed at least 30 hours a week --  or from higher employer payments toward the benefit packages.

"The law does figure out how to provide access to benefits for 30 million Americans who don’t have it," says Watts. "Beyond that, there’s not a whole lot in there that helps manage costs for employers. You could argue that will be a byproduct of the law, but there’s no certainty around that. Time will tell."

No matter the outcome Tuesday, she and other consultants say the trend toward private insurance exchanges will continue. Employers like the concept because the private marketplaces make it easier for them to set caps on the amount they pay toward premiums, allowing employees to choose more expensive plans if they pay the difference. 

If premiums rise faster than the caps set by employers, workers would pay more, picking up a growing share of costs. Proponents expect a tempering effect on premiums, however, through competition among insurers that sign up to offer coverage through the private exchanges.

A number of private exchanges, run by consulting firms and insurers, are already capitalizing on the trend, offering an alternative to the future state-based marketplaces.

Benefit consultant Aon Hewitt, for example, has a private exchange for its workers andrecently signed deals with Darden Restaurants and retailer Sears, which will send tens of thousands of their workers to the exchange starting in January.

UnitedHealth Group, one of the nation’s largest insurers, has purchased Connextions, a firm that helps form exchanges. The Blues plans, through Wellpoint and Blue Cross Blue Shield of Michigan, have bought into Bloom Health, which runs an employer exchange.

"On the employer side, private exchanges are the main action under either an Obama or Romney administration," says Joel Ario, a consultant at Manatt Health Solutions and former Obama administration official in charge of exchange planning.

He says state-based exchanges, like the one already operating in Massachusetts, work well for individuals, but have not caught on as fast with employers. "A lot of employers will be saying they like the exchange idea, but may not want to be in the public exchange, unless they can get a tax credit."

After CBO, what’s next on GOP health care plan in Congress

Published: Thursday, May 25, 2017 @ 4:15 AM
Updated: Thursday, May 25, 2017 @ 4:15 AM

Now that the Congressional Budget Office has weighed in on a House-passed GOP health care bill, Republicans must still do a lot of work to not only forge a plan in the Senate, but also figure out how to get it to the President’s desk for his signature.

The CBO report found the revised GOP plan, which was approved earlier this month, would save $119 billion over ten years, and would result in 23 million fewer people having health insurance by 2026, than under Obamacare.

The report also raised questions about coverage for those with pre-existing conditions, and found that low income Americans between ages 50 to 64 would be hit with large price hikes.

Here’s where we stand on GOP efforts to overhaul the Obama health law:

1. Senate Republicans still searching for a deal. The CBO score didn’t change anything for Republicans, as Senate Majority Leader Mitch McConnell said on Wednesday that he’s still looking for fifty votes to advance a health care plan in the Senate. GOP Senators have been talking regularly behind closed doors, floating a variety of plans, but they don’t seem to be near an agreement. Complicating matters is that Republicans can only lose two votes and keep things on track.

2. For now, it’s only Republicans at the table. While there have been some bipartisan meetings, the official GOP effort is not reaching across the aisle on health care. Senate Majority Leader McConnell has made that clear that he is not interested in bringing Democrats aboard to cut a health care deal, arguing that they won’t even acknowledge the problems that exist in Obamacare right now. Again, with such a small margin for error, not having any Democratic votes make life difficult for the GOP.

3. There still is the option of not passing anything. Senate GOP leaders have indicated to reporters that a vote will occur in coming months, even if that plan gets rejected by the Senate. That could result in something that President Trump had floated months ago, just letting troubles mount in the Obamacare system until it creates enough blowback from the public to force action in the Congress. Sen. Lindsay Graham (R-SC) yesterday raised that as a possibility.

4. It’s easier to be against than for something on health care. Democrats have been much more organized in recent weeks in terms of arguing against GOP plans, while Republicans have struggled to forge a unified public message for their health care overhaul effort. It is the exact opposite of where we were for the last seven years, when Republicans were the ones taking pot shots at the Obama health law, and Democrats were acting skittish. And even the poll numbers have flipped as well – this is a Fox News poll:

5. $1,000 a month for maternity coverage? In its report, the Congressional Budget Office said if states decide to allow for lower cost plans that have less coverage, then people should expect extras, like maternity coverage, would not be cheap. “Insurers would expect most purchasers to use the benefits and would therefore price that rider at close to the average cost of maternity coverage, which could be more than $1,000 per month,” the CBO wrote. Let’s just say that example didn’t play too well with female Democrats in the Congress

6. Who are the 23 million more who won’t have coverage?This is an interesting figure from the CBO, because it is immediately challenged by opponents of Obamacare, who argue that people should have the right to *not* buy health insurance, and that most of those going without insurance will fall into that category. But that’s not what the CBO found. The report says 14 million people who are currently covered by Medicaid would go uninsured – presumably because they couldn’t afford insurance. Another six million would stop having coverage with changes in the state and federal exchanges.

7. Will health care derail a GOP seat in Montana? A few hours after the CBO report was issued on the House-passed health plan, the story turned into a WWE event, as a reporter claimed a Montana Republican candidate for Congress body slammed him after being asked about the CBO numbers. We’ll see if the dispute causes any aftershocks at the polls in the Big Sky State tonight.

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23 million would lose insurance under new health care bill, CBO says

Published: Wednesday, May 24, 2017 @ 5:29 PM

23 million would lose insurance under new health care bill, CBO says

The House Republican plan to replace Obamacare would reduce deficits by $119 billion over the next decade, but increase the number of Americans without health insurance by 23 million over the same period, according to a report released Wednesday by the nonpartisan Congressional Budget Office.

The report, done with the Joint Committee on Taxation, also found that in states that receive a waiver from market regulations, the price for those who become ill or who have preexisting conditions could skyrocket to the point that they would ultimately be priced out of the market.

RELATED: Democrats reach out to GOP senators to come up with deal

In short: Those that are healthy will still be able to buy health insurance with lower premiums, but those that are not will not. The report also found that while premiums would be about the same or lower for young people with lower income, premiums for older people with lower income would be “much larger than under current law” on average.

And the report cautioned that the narrower scope of benefits covered in many plans might cause “substantial” increases in out-of-pocket health care costs for everything from mental health care to maternity leave care to pediatric dental care.

The score was released 20 days after the House narrowly passed a bill that aimed to make sweeping changes to the 2010 health care law known as Obamacare. Since then, the Trump Administration has moved forward on a budget proposal that assumed the passage of the House bill.

Rep. Pat Tiberi, R-Genoa Township, said the bill was “just the start,” and is needed to help stop skyrocketing costs caused by Obamacare.

“House Republicans and the Administration will continue to focus on additional steps we can take to restore the free market, increase choices and lower costs so that Americans can afford the plans they want and need,” he said.

By contrast, Rep. Tim Ryan, D-Niles, said the GOP bill “takes away health care from 23 million Americans, reduces the deficit even less than the first version and gets there by throwing people with pre-existing conditions under the bus.

“This legislation is offensively bad, and will destroy the health care system Americans have come to rely on,” he said.

The House bill faces an uncertain future in the Senate. Senate Majority Leader Mitch McConnell told Reuters Wednesday that he does not yet now how the Senate gets to 50 votes on the bill.

Sen. Rob Portman, R-Ohio, earlier this month indicated that he doesn’t support the House bill as it stands “because I continue to have concerns that this bill does not do enough to protect Ohio’s Medicaid expansion population, especially those who are receiving treatment for heroin and prescription drug abuse.” Emily Benavides, a Portman spokeswoman, said Portman had not shifted on that position since then. "We will review the new analysis as we work on a different approach here in the Senate," she said.

RELATED: Dayton congressman among those who voted no on health care bill

Sen. Sherrod Brown, D-Ohio, called the House GOP bill “a bad deal.”

“The House bill will drive up costs, kick Ohioans off their insurance, and leave folks who have asthma or cancer unable to even purchase a plan,” he said. “Instead of moving forward with this bill, we need to work together to reduce costs and improve care for those we serve.”

Failing to repeal and replace Obamacare would be a political embarrassment for Republicans who made that promise a centerpiece of last year’s campaign. An earlier attempt to pass a bill to repeal and replace the 2010 law officially known as the Affordable Care Act failed to muster enough votes, and House leadership chose to pull the bill rather than see it fail on the floor.

The bill passed in May came after an earlier effort failed to muster the votes for passage. That GOP plan would’ve boosted the number of uninsured to 24 million by 2026 but would have cut the deficit by $150 billion, according to a CBO report on that plan.

The report released Wednesday found “average premiums for insurance purchased individually — that is, non-group insurance — would be lower, in part because the insurance, on average, would pay for a smaller proportion of health care costs. In addition … some people would use the tax credits authorized by the act to purchase policies that would not cover major medical risks and that are not counted as insurance in this cost estimate.”

The largest savings resulted from cutbacks in Medicaid.

The 2010 Affordable Care Act — also known as Obamacare — extended health-care coverage by offering middle-class people federally subsidized insurance policies in the individual market, and by expanding eligibility for low-income people to be covered by Medicaid, a joint federal and state program which provides health care for the poor.

The nonpartisan Congressional Budget Office is tasked with determining the impact of bills. The current head of the office was selected by Republican lawmakers.

CBO: GOP health bill saves $119 billion, 23 million fewer would be insured

Published: Wednesday, May 24, 2017 @ 4:59 PM
Updated: Wednesday, May 24, 2017 @ 4:59 PM

A review of a Republican health care overhaul plan which passed the House earlier this month found it would result in 23 million fewer people having health insurance over the next ten years, as the Congressional Budget Office questioned whether some GOP changes might promote instability in state health insurance markets.

The most important figure from the CBO review was that the plan would reduce the budget deficit by $119 billion over ten years, ending any concerns that the measured would be derailed by strict budget rules used in the Senate.

The CBO review was slightly better than one on an earlier version of the House bill when it comes to the number of people who would not have health insurance – 23 million by 2026, compared to 24 million before changes were made to win enough votes for passage in the House.

But the report raised some concerns with a pivotal change made by Republicans, which allows states to get waivers from certain key provisions of the Obama health law – allowing states to peel back certain “Essential Health Benefits,” and changes in how insurance companies can set premiums based on someone’s health status, something known as “community rating.”

“As a result, the nongroup markets in those states would become unstable for people with higher-than-average expected health care costs,” the CBO report stated.

“That instability would cause some people who would have been insured in the nongroup market under current law to be uninsured,” the report added.

The release of the CBO numbers came as Senate Republicans continued to work behind closed doors on their own health care plan.

“We have to have the goal of lowering premiums for Americans,” said Sen. Bill Cassidy (R-LA). “And it has to be credible coverage.”

As of now, GOP Senators are only working with each other, and not trying to gain the votes of any Democrats.

It’s a very small margin for error for the GOP, which can only afford to lose two of their 52 members – and then would have to rely on the tie breaking vote of Vice President Mike Pence.

At this point, the health care bill approved by the House on May 4 still has not been sent to the Senate, as Republicans try to figure out their next step.

The House and Senate are not in legislative session next week, meaning any action by Republicans will be pushed into June.

The longer it takes to resolve health care legislation, the longer it will take to deal with the 2018 budget and President Trump’s plans on tax reform.

Ex-CIA Director worried by 2016 contacts between Russia and certain U.S. persons

Published: Tuesday, May 23, 2017 @ 12:15 PM
Updated: Tuesday, May 23, 2017 @ 12:15 PM

Former CIA Director John Brennan told Congress on Tuesday that he was so concerned about intelligence that showed contacts between Russian officials and people linked to the campaign of President Donald Trump, that he warned key members of Congress and other intelligence agencies about the Russian actions, and sent that information on to the FBI for further investigation.

It became very clear to me last summer, that Russia was engaged in a very aggressive and wide ranging effort to interfere,” Brennan said, revealing that he had brought in experts from around the U.S. Intelligence Community to try to figure out what the Kremlin was doing.

“I encountered and am aware of information and intelligence that revealed contacts and interactions between Russian officials and US Persons involved in the Trump campaign,” Brennan told the House Intelligence Committee, as part of its review of Russian interference in the 2016 U.S. elections.

At a hearing, Brennan refused to identify anyone by name, or give any indication as to whether the Russians had been successful in getting the “witting or unwitting” help of any Americans, to further the Kremlin’s 2016 efforts.

Pressed by several GOP lawmakers, Brennan acknowledged that he did not know of any evidence of collusion between the Trump Campaign and the Kremlin – but Brennan said that was for the FBI to investigate, not the CIA.

“I don’t know whether or not such collusion – and that’s your term – such collusion existed, I don’t know,” Brennan said.

Brennan also denied that he had made last minute requests to unmask names of any U.S. Persons – possibly linked to the Trump Campaign – before the former CIA Director left the agency as President Trump was sworn into office on January 20, 2017.

The Russia investigation was also grabbing the attention of Senators at the same time, as Director of National Intelligence Dan Coats refused to say whether he had been pressured by the President – or by White House officials – to try to get the FBI to drop its investigation into the Russia matter.

“I don’t feel it’s appropriate to characterize conversations with the President,” Coats said.

A former Senator, Coats seemed ill at ease as he sidestepped the queries of some of his former colleagues.