Tag: obamacare repeal

‘Will the Feds Be Ready With the Fallback Insurance Exchanges by October 2013?’

That’s the title of Robert Laszewski’s latest blog post:

The White House just released a report saying that good progress is being made [toward creating health insurance Exchanges] in 28 states. That begs the question, what about the other 22?

Writing in Kaiser Health News, Julie Appleby recently reported that that HHS has let just two contracts toward building the federal fallback exchanges. One is for $69 million to build the data hub so that federal agencies can share data with the exchanges–the IRS for example. The other contract is more directly related to building federal fallback exchanges, a $94 million contract.

But in their progress report today, the administration said that they have already advanced $729 million to the states for exchange construction––17 of those states receiving $1 million, or less. So, more than $700 million has gone to 33 states–and that is just federal money to date.

If the feds are going to be ready to launch 10 or 20 federal fallback exchanges these numbers just don’t compute. It is going to take a lot more than the $94 million HHS has contracted for to launch that many federal exchanges in the states that refuse to do so.

HHS says they will be ready. But they have been awfully secret over just how they are going to have lots of exchanges ready to go in 20 months. It is hard to see how that $94 million contract is more than just a down payment…

Right now, the numbers don’t compute–the number of states that could well not be ready, the federal money being spent by states that say they will offer exchanges, and the much less money HHS admits to be spending for those that will not be ready.

Where’s the plan?

The administration’s claim that 28 states are taking “strong steps” toward creating Exchanges is questionable. For one thing, the administration should update their “good progress” count to reflect the fact that Wisconsin Gov. Scott Walker (R) just returned a $37 million ObamaCare grant and refused to create an Exchange. In that light, the administration’s announcement is reminiscent of a scene from Animal House:

The question of whether states create ObamaCare Exchanges is, of course, central to the survival of the law.

 

Oops, Maybe ObamaCare’s Cost Controls Won’t Work after All

One of ObamaCare’s big selling points was that it would launch lots of pilot programs so that Medicare bureaucrats could learn how to reduce health care costs and improve the quality of care. Yesterday, the Congressional Budget Office threw cold water on the idea.

In 2010, Peter Orszag and Ezekiel Emanuel explained the promise of ObamaCare’s pilot programs:

[The law’s] pilot programs involving bundled payments will provide physicians and hospitals with incentives to coordinate care for patients with chronic illnesses: keeping these patients healthy and preventing hospitalizations will be financially advantageous…And the secretary of health and human services (HHS) is empowered to expand successful pilot programs without the need for additional legislation.

Atul Gawande wrote even more glowingly:

The bill tests, for instance, a number of ways that federal insurers could pay for care. Medicare and Medicaid currently pay clinicians the same amount regardless of results. But there is a pilot program to increase payments for doctors who deliver high-quality care at lower cost, while reducing payments for those who deliver low-quality care at higher cost. There’s a program that would pay bonuses to hospitals that improve patient results after heart failure, pneumonia, and surgery. There’s a program that would impose financial penalties on institutions with high rates of infections transmitted by…

You get the idea.

The thing is, pilot programs in Medicare are not new.  And in a review of dozens of Medicare pilot programs released yesterday, the Congressional Budget Office revealed they aren’t very successful, either:

The disease management and care coordination demonstrations comprised 34 programs…

In nearly every program, spending was either unchanged or increased relative to the spending that would have occurred in the absence of the program, when the fees paid to the participating organizations were considered…

Only one of the four demonstrations of value-based payment has yielded significant savings for the Medicare program.

No big deal, you say. Startups fail all the time. What’s important is not that 37 startups failed, but that one succeeded.

That’s how things are supposed to work. But as Alain Enthoven explained to Gawande, the really perverse thing about Medicare pilot programs is that even the successful ones die:

Gawande got it wrong about pilots…The Medical Industrial Complex does not want such pilots and often strangles them in the crib. For example, nothing lasting and significant came of the pilot to reward people for getting their heart bypass surgery at regional centers of excellence. I don’t remember the details of how it died, but I believe it was tried and went nowhere.  No doubt every hospital thought it was a center of excellence and wanted to be so rewarded.

Another more recent example is durable medical equipment.  David Leonhardt had an excellent article in the New York Times on June 25, 2008 called “High Medicare Costs Courtesy of Congress.”  Someone had sold the good idea that prices of durable medical equipment should be determined by competition, and there was a provision in law for pilots to test competition. The industry lobbied hard to stop it and promulgated scare stories. “Grandma won’t get her oxygen.”  Leonhardt recounts how Democratic and Republican leaders got together and postponed the pilot— and, I suspect, postponed it forever.  There were proposals to test health plan competition, fought off by the industry of course.  So this is not a fertile political environment for pilots.  In fact, one of the most important lessons that has come out of the current “reform” process is the enormous power of the medical industrial complex and their large financial contributions and armies of lobbyists to block any significant cost containment.

Rather than a reason for more government interference in health care, the death of these pilots is a consequence of government interference. If the federal Medicare program weren’t such an enormous player in the U.S. health care sector, industry lobbyists (and their servants in Congress) wouldn’t have so many ways to protect themselves from competition by more efficient providers.

Enthoven summed up ObamaCare’s approach to cost control best:

The American people are being deceived. We are being told that health expenditure must be curbed, therefore “reform is necessary.”  But the bills in Congress, as Gawande acknowledges, do little or nothing to curb the expenditures.  When the American people come to understand that “reform” was not followed by improvement, they are likely to be disappointed.  Our anguish is only intensified by the fact that the Republicans are no better at fiscal responsibility, probably worse as they demagogue reasonable attempts to limit expenditures.

Congress is sending the world an unmistakable signal that it is unable or unwilling to control health expenditures and the fiscal deficit.  That is not going to make it easier to sell Treasury bonds on international markets. I fear this will lead to higher interest rates.

FYI, Enthoven wrote those words in 2009.

‘They’d Rather Be Caught Sacrificing to Satan Than Voting for Obamacare’

Michigan has become the latest to repudiate Obamacare:

In an action with major implications for health reform in Michigan, the state House has voted to turn down—at least for now—nearly $10 million in federal funds to create a statewide health exchange by 2014 to sell more affordable, standardized health insurance to consumers and small businesses.

The Michigan House’s action is consistent with what everyone from the American Legislative Exchange Council to the Heritage Foundation to the Cato Institute has recommended that states do: refuse to create an Exchange and send the money back to Washington.

Our friend Jack McHugh of the Mackinac Center for Public Policy writes:

Under the Michigan Constitution, no money can be spent by the state—including federal grant money—unless the Legislature passes an appropriation bill authorizing the spending…

House Republicans have shown no eagerness [to create a state Obamacare exchange], and that reluctance extended to this appropriation bill. In the colorful words of House Appropriations Chair Chuck Moss, R-Birmingham, to MIRS News, “They’d rather be caught sacrificing to Satan than voting for Obamacare, so that’s the way it is.”

Jonathan Adler and I explain in this Wall Street Journal oped how Michigan officials can protect Michigan employers (including the state government itself) from penalties under Obamacare’s employer mandate—and even help bring down the entire law—by refusing to create an Exchange.

Va. Gov. McDonnell (Sort of) Takes My Advice, Defers Creating ObamaCare Exchange

In June, I testified in Richmond before Virginia’s Joint Commission on Health Care that Virginia should refuse to create one of ObamaCare’s health insurance “exchanges”:

[ObamaCare’s] health insurance “Exchanges” are scheduled to become operational in 2014.  These new government bureaucracies would enforce the law’s regulations that will drive up health insurance premiums, and would distribute hundreds of billions of taxpayer dollars to private health insurance companies, thereby driving up the national debt…

Neither the Commonwealth nor the federal government has money to waste on new government agencies that might be repealed or overturned tomorrow…

At a minimum, Virginia should defer the question of creating an Exchange until the courts dispose of the constitutional challenges brought against this law.  Legal scholars expect the U.S. Supreme Court to rule on this law in the summer of 2012…If the Court voids the law, Virginia will be glad she waited.

Virginia Gov. Bob McDonnell (R) has inexplicably been gung-ho to create an ObamaCare Exchange. According to the Richmond Times-Dispatch, however, McDonnell may be modulating his tune:

McDonnell said he does not want to create an exchange legislatively until after the court makes its decision on the mandate’s constitutionality. The court will hear arguments in the case in March and possibly rule in July, just after a federal deadline for states to seek grant money to set up exchanges.

“Any major expense prior to the court decision is irresponsible and a waste of money,” the governor said at a luncheon meeting with members of the Capitol press corps.

Unfortunately, McDonnell is still laboring under the misapprehension that creating her own Exchange will let Virginia retain a measure of control over her health insurance markets:

McDonnell said he hopes the Supreme Court will strike down the law’s individual mandate, rendering an exchange unnecessary, but he made clear he wants Virginia to operate the exchange if the law stands.

“If we have to do it, I clearly want to have a state-based exchange,” he said.

To read about why Virginia doesn’t “have to do it,” and why there is no defensible rationale whatsoever for an ObamaCare opponent such as McDonnell to create an Exchange, read my Missouri testimony.

To learn how McDonnell may end up saving ObamaCare from repeal by creating an Exchange, read this Wall Street Journal oped by Jonathan Adler and me.

Podcast: How States Can Shut Down ObamaCare

Here’s a podcast on how states can shut down ObamaCare.

And here are links to additional material, including an op-ed that provides an overview, a blog post about Sen. Orrin Hatch (R-UT) getting involved, a blog post on how presidential candidates could get involved, and finally a blog post on what the Obama administration has to say about all this.

You Can’t Make a Silk Purse out of ObamaCare’s Poll Numbers

The Kaiser Family Foundation’s November 2011 poll results on ObamaCare (“the ACA”) are now available.  The gist:

After taking a negative turn in October, the public’s overall views on the ACA returned to a more mixed status this month. Still, Americans remain somewhat more likely to have an unfavorable view of the law (44%) than a favorable one (37%).

The survey also finds that individual elements of the law are viewed favorably by a majority of the public. The law’s most popular element, viewed favorably by more than eight in ten (84%) and “very” favorably by six in ten, is the requirement that health plans provide easy-to-understand benefit summaries. Also extremely popular are provisions that would award tax credits for small businesses (80% favorable, including 45% very favorable) and provide subsidies to help some individuals buy coverage (75% favorable, including 44% very favorable), as well as the provision that would gradually close the Medicare doughnut hole (74% favorable, including 46% very favorable) and the “guaranteed issue” requirement that prohibits health plans from denying coverage based on pre-existing conditions (67% favorable, including 47% “very” favorable)…

Far and away the least popular element of the health reform law is the individual mandate, the requirement that individuals obtain health insurance or pay a fine. More than six in ten (63%) Americans view this provision unfavorably, including more than four in ten (43%) who have a “very” unfavorable view.

I’ve written about such spin-heavy polls before, including here:

Rather than confront their own errors of judgment, [ObamaCare supporters] self-soothe: The public just doesn’t understand the law. The more they learn about it, the more they’ll like it…

This denial takes its most sophisticated form in the periodic surveys that purport to show how those silly voters still don’t understand the law. (In the mind of the ObamaCare zombie, no one really understands the law until they support it.) A prominent health care journalist had just filed her umpteenth story on such surveys when I asked her, “At what point do you start to question whether ObamaCare supporters are just kidding themselves?”

Her response? “Soon…”

And here:

Asking people whether they support the law’s pre-existing conditions provisions is like asking whether they want sick people to pay less for medical care.  Of course they will say yes.  If anything, it’s amazing that as many as 36 percent of the public are so economically literate as to know that these government price controls will actually harm people with pre-existing conditions.  Also amazing is that among people with pre-existing conditions, equal numbers believe these provisions will be useless or harmful as think they will help…

[T]he pre-existing conditions provisions cannot exist without the wildly unpopular individual mandate because on their own, the pre-existing conditions provisions would cause the entire health insurance market to implode.

If the pre-existing conditions provisions are a (supposed) benefit of the law, then the individual mandate is the cost of those provisions. If voters don’t like the individual mandate–if they aren’t willing to pay the cost of the law’s purported benefits–then the “popular” provisions aren’t popular, either.

Or, as Firedoglake’s Jon Walker puts it, ObamaCare is about as popular as pepperoni and broken glass pizza.

See you again next month.

North Dakota Rejects ObamaCare ‘Exchange’

Here’s the story, from the Bismarck Tribune:

Angered by a federal health care law that most of them despise, North Dakota House Republicans defeated legislation Thursday to give state officials authority over a health insurance marketing agency that the law requires states to establish.

(Correction: ObamaCare does not require states to create an Exchange.)

They said endorsing state administration of the agency, which is called a health insurance exchange, would be tantamount to approving the federal health reform law itself.

“I certainly am not going to legitimize Obamacare with my vote,” said Rep. Wes Belter, R-Fargo. “We, as a state of North Dakota, need to follow some of the other states who have said no… It is the law, but the fight should not be over.”

Supporters … said Thursday’s vote was the state’s last realistic chance for running its own exchange, since deadlines are looming and the Legislature does not meet again until January 2013…

After a debate that lasted almost two hours, representatives voted 64-30 late Thursday to reject the legislation. All but 10 of the House’s 69 Republicans voted against the bill, while 20 of its 25 Democrats supported it…

Opponents of the bill said they resented the pressure, which they said was caused by unrealistic deadlines in the federal health care law.

Rep. Keith Kempenich, R-Bowman, compared the situation to high-pressure sales tactics in a used car lot.

“If the federal government was really sincere on trying to reform health care, they wouldn’t have put these artificial dates in,” Kempenich said. “Whenever I’ve seen things that get rushed like this, or they get where you’re pressured like this, usually, they’re full of it, and that’s what this is starting to look like.”

Kudos to the North Dakota Policy Council’s Brett Narloch.