Author: Lucien Wulsin


Summary of the Kaiser Family Foundation Survey of California’s Uninsured

The Kaiser Family Foundation has released a longitudinal survey of what has happened to California’s uninsured over a two-year period of ACA implementation. In 2013, 100% of those sampled were uninsured; in 2014 after the first open enrollment 58% were insured; and in 2015 after the second open enrollment 68% were insured.

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Of the newly insured, about half went into Medi-Cal, a quarter into Covered California and a quarter into employment-based coverage. Among uninsured Hispanics, 60% were enrolled, 17% were eligible but not enrolled and 14% were undocumented and not eligible. Among non-Hispanic whites, 79% enrolled and 21% were eligible by remained uninsured.

62% of those enrolled in Covered California reported being helped, and 20% reported being hurt; for the remaining 17%, there was no impact. 43% of those enrolled in Medi-Cal reported being helped, and 8% reported being hurt; for the remaining 46%, there was no impact. 10% of those enrolled in employer-sponsored coverage reported being helped, and 21% reported being hurt; for the remaining 59%, there was no impact.

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Most (63%) of the newly insured stayed with the same plan, while 17% changed to a different plan from 2014.

Most (62%) of the newly insured reported they were automatically re-enrolled and 35% reported having to take action to re-enroll.

Most said the costs were what they had expected or less; 20% reported that they were more than they expected, including 28% of those with Covered California and 31% of those with employment-based coverage.

76% said their experiences with their new plans were positive and 18% were negative. 80% of the newly insured had no problems getting a doctors; 16% experienced difficulties.

The remaining uninsured were 1/4th Medi-Cal eligible; 1/4th Covered California subsidy eligible, and 41% undocumented and ineligible. 1/4th of the remaining uninsured were between 26-34; 36% between 35 and 49, 1/4th 50-64, and 1/6th between 19 and 25.

Of the remaining uninsured, 2% were opposed to the ACA; 23% were not eligible, and 44% could not afford insurance. About 1/3rd have tried to enroll but were unsuccessful.

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84% of the remaining uninsured knew about the mandate, but only ½ knew about the Medi-Cal expansion or financial assistance through Covered California.

Half of the remaining uninsured Hispanics were concerned about the impacts on their immigration status or those of family members if they enrolled.

1/4th enrolled by phone, 1/3rd in person, 1/5th on the internet and 1/10th by mail. About 34th said the process was easy and 1/5th said it was difficult.

85-90% of the remaining uninsured had not visited the Covered California website or called the 800 number.

This summary of the Kaiser Family Foundation’s findings on California ‘s Uninsured is available for download.

Summary of Gallup Poll on State’s Progress in Reducing the Numbers of Uninsured

The latest Gallup Poll findings showed California ranked 6th in the nation by successfully reducing its rates of uninsured from 21.6% to 11.8%.

Arkansas led the nation with a reduction from 22.5% uninsured to 9.1% uninsured. Kentucky reduced its rates of uninsured from 20.4% to 9.0%. Oregon reduced its uninsured rate from 19.4% to 8,8%, Rhode Island reduced its uninsured rate from 13.3% to 2.7% and Washington cut its uninsured rates from 16,8% to 6.4%.

Six states now have uninsured rates of 5% or less – Rhode Island, Massachusetts, Vermont, Connecticut, Minnesota and Iowa.

Even in a state that have led the resistance to the ACA, such as Texas, the uninsured fell from 27.0% to 20.8%. In Florida, which is still badly divided on adopting the Medicaid expansion, the uninsured rate dropped from 22.1% to 15.2%.

The full poll findings may be accessed on the Gallup website.

This ITUP summary is available for download.

San Francisco, The Spirit Of The Pioneers: Taking Steps To Improve Both Healthy San Francisco And The ACA

San Francisco is pioneering yet again. It’s proposing to modernize the “City Option” by creating a new Bridge to Coverage and expanding its Healthy San Francisco program for the remaining uninsured. Most city businesses either offer coverage to their employees or help pay for their care through medical reimbursement accounts or Healthy San Francisco. This updates them to better coordinate with the Affordable Care Act (ACA).

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The Bridge to Coverage will offer financial help with premium assistance under Covered California as well as with more affordable copays and deductibles. It will supplement the ACA’s refundable tax credits available in Covered California and help working San Franciscans better afford the premiums for coverage and the out of pocket for care. It limits out of pocket exposure to 5% of an individual’s income. It will extend financial assistance to workers and their families who are eligible for Covered California as long as their employer contributed to the “City Option” for their coverage rather than purchasing employment based coverage for them. This will be particularly important for the flex workforce and for the employees of smaller businesses – about 3,000 to 4,000 San Franciscans will be helped.

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The proposal will also align the Healthy San Francisco program with the ACA. Eligibility is extended to those with incomes up to 500% of FPL who are not eligible for any public programs and either cannot afford the Covered California premiums or are exempt from the individual mandate. We think that it is vital to parallel existing county health programs like Healthy San Francisco for the uninsured with the ACA’s coverage expansions. It will be far simpler to understand and administer for everyone involved “you are either eligible for the ACA or for Healthy San Francisco”, there is no overlap and everyone is covered. About 15,000 San Franciscans will qualify.

The proposal will also help to design and create a new Employee Wellness Fund to reimburse for employee wellness programs for those employers who have contributed to the “City Option”. In concert these programs should help the San Francisco residents to improved health status and better financial security. They will be considered by the Health Commission on Tuesday, August 4.

What a great way for a City to celebrate the 50th Birthday of Medicare and Medicaid.

Summary of Covered California Premiums for 2016

Covered California has announced its 2016 premiums. It reports that the over-all increase (weighted average, assuming purchasing patterns are the same as last year) is 4%. The average increase for the lowest priced bronze plans is 3.3%. The increase in premiums for the lowest priced silver plan is 1.5% and the second lowest cost priced silver will cost 1.8% more on average. If customers seek to buy the lowest cost plan, they would save 4.5% on their premiums.

You may read the full report summary here.

Gallup Poll Results – U.S. Uninsured Rate Falls to 11.4% in Second Quarter of 2015

The United States uninsured rate has fallen from 18% to 11.4% (a 36% decline) between the last quarter of 2013 and the second quarter of 2015 according to the recent Gallup and Healthways Tracking Poll. This is a phenomenal achievement in the face of sustained efforts to derail the ACA and some states’ unwillingness to adopt the Medicaid expansion, whose costs would be paid 100% by the federal government.

The uninsured rates for those earning less than $36,000 annually fell from 30.7% to 20.8% (a 33% decline) while the uninsured rates for those earning over $90,000 annually fell from 5.8% to 3.6% (a 38% decline) while for those in the middle with incomes between $36,000 and $90,000, the uninsured rates fell by 30%. As more states expand their Medicaid programs and more individuals become familiar and comfortable with the Exchanges and the tax credits to improve the affordability of coverage, the uninsured rates should decline further.

The Gallup poll indicates that coverage of Americans has increased across the board with more people reporting they are enrolling in long established programs such as Medicare and Veteran’s benefits as well as the new Exchanges and Medicaid expansions. Employer coverage, which has been in steady decline since the mid 70s, covers about 43.4% of all Americans – a decline of less than 2% since 2013.

 

 

Monopolistic Profiteering? Market Failures?

For the last 5 years since the passage of the Affordable Care Act, health care costs have been under control; per capita spending in Medicare has shown very slow growth, same with Medicaid and recently most private insurance. There have been debates about causation; some suggest the Great Recession and its aftermath; others credit the payment reforms in the ACA. The great debates on whether to regulate rates or to let the markets decide have been held in abeyance as the rates of health spending growth have moderated. But!!!

Recently, Health Affairs reported that some for profit hospitals are price gouging their uninsured patients and others by inflating their charges by up to 1000% above their costs. Ge Bai and Gerard Anderson, Extreme Markup: the Fifty US Hospitals with the Highest Charge to Cost Ratios, Health Affairs (June 2015).  While the worst actors were for profit hospitals associated with two hospital chains and many of the worst were based in Florida, inflated charges are the hospital industry norm, now averaging nearly 400% of costs here in California where three of the fifty were located.

There really is no good reason to continue the outdated fiction of hospital charges; Medicare does not pay them; Medi-Cal does not pay them; private insurance does not pay them and the uninsured are moving into coverage through Covered California and Medi-Cal at rapid rates so they don’t pay them. They are an anachronism whose time has passed and should be eliminated.

The Los Angeles Times and others have reported on the large for profit national health plans in acquisition frenzy mode to buy each other and their smaller competitors in order to achieve dominant national and state market shares.

How might this impact California? We do have smaller national for profits in Health Net and Molina based in California; they could become acquisition targets for the big national for profit plans. In California, the commercial markets are dominated by four plans: Kaiser, Anthem Blue Cross, Blue Shield and Health Net – only one of which is a large, national for profit; they have 85% of the small group market, 81% of the individual market, and 90% of the individual market. In the county Medi-Cal managed care markets, local government organized plans typically dominate their markets (about 2/3rds of total enrollment) with commercial competition from Health Net, Anthem Blue Cross, Molina and now Blue Shield/Care 1st. Health Net has about a 14% market share statewide. Kaiser participates in the Medi-Cal managed care markets in San Diego, Sacramento and as a subcontractor in Los Angeles, but is a much smaller participant than either Health Net or Anthem Blue Cross and does not compete directly with the government organized plans. In California, nearly 38% of Medicare beneficiaries participate voluntarily in managed care plans. While the Medicare Advantage Plans market includes greater participation by the national non-profits, such as Humana, United and Aetna, Kaiser, nevertheless, has nearly a 45% market share in California, followed by United at 16% and then California-based Health Net and SCAN with between 7 and 8% of the market each.

 

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Physicians specializing in the care of cancer patients are organizing a backlash to the astronomical pricing of life saving cancer drugs. The criticisms are coming from doctors close to the drug companies, who have helped develop and test drugs for the pharmaceutical industry.

Hepatitis C blockbuster drugs (Solvadi) are priced at $1,000 a pill, projected to add $200-300 per year to every Americans’ health premium for the next five years. Sovaldi is scheduled for $10 billion in sales in 2014, making it the largest selling drug in the world. Company profits were up nearly 500% from 50¢ a share to $2.36 a share in one year.

What can be done? What needs to be done? The Covered California Board capped the amount of these soaring specialty drug costs that can be passed on to patients.  The California legislature capped hospitals’ ability to pass on their inflated charges to their low, moderate and middle-income patients.  The Health Affairs analysis of California’s Hospital Fair Pricing Act is available here.

While important, these caps do not address the fundamental question because it still leaves entities with near monopoly powers the freedom to pass on their highly inflated prices to others.

Should society regulate the monopoly pricing policies of health care purveyors for scarce and life saving treatments? My opinion is an unqualified “yes”, and it needs to get started. The state and federal governments can use the justice system, the legislative and oversight process, the administrative process, anti trust enforcement or their contracting authority, but they need to send a clear and strong message on profiteering and monopoly pricing in the health care industry. In my opinion this is not a question of free markets or competition versus state regulation, but rather of profiteering in life saving care.

Supreme Court Upholds the Refundable Tax Credits/Premium Subsidies For Federal Exchanges

In a 6-3 decision authored by Chief Justice Roberts, the Supreme Court upheld the premium assistance provisions of the Affordable Care Act for federally operated Exchanges. The court introduced the issues at stake as follows: “the Patient Protection and Affordable Care Act adopts a series of interlocking reforms to expand coverage in the individual health insurance market. First, the Act bars insurers from taking a person’s health into account when deciding whether to sell health insurance or how much to charge. Second, the Act generally requires each person to maintain insurance coverage or make a payment to the Internal Revenue Service. And third, the Act gives tax credits to certain people to make health insurance more affordable…. This case is about whether the Act’s interlocking reforms apply equally in each state no matter who establishes the State’s Exchange” and concluded “Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them. If at all possible we must interpret the Act in a way that is consistent with the former and avoids the latter. Section 36B (refundable tax credits in federal Exchanges) can fairly be read consistent with what we see as Congress’ plan and that is the reading we adopt.” 576 US — (2015)

Document-1-page001In dissent, Justice Scalia was outraged and characterized the majority’s opinion among other things as “apple sauce” and “jiggery pokery” and concluded “perhaps the Patient Protection and Affordable Care Act will attain the enduring status of the Social Security Act and the Taft Hartley Act; perhaps not… the cases will publish forever the discouraging truth that the Supreme Court favors some laws over others and is prepared to do whatever it takes to uphold and assist its favorites.”

Phillip Bump, writing in today’s Washington Post notes “Whether or not Republican politicians consider Thursday’s Supreme Court ruling a negative for them is open to interpretation. The 2016 candidates have railed against it in their press releases, but deep down inside, it’s hard to believe that they wanted to deal with the fallout of the nuclear detonation that a ruling against ObamaCare would have been. They still have their political cudgel and they don’t have to clean up a mess. Win-win. And for Republican voters the win is even clearer…. About 1.8 million people in federal exchanges live in counties that voted for Obama. About 4.5 million live in counties that voted for Mitt Romney”.

Lena Sun and Robert Gebelhoff writing in today’s Washington Post interviewed consumers enrolled in federal Exchanges. “Ida Sievers (of South Dakota) who was diagnosed with leukemia last fall, had been praying that she wouldn’t lose the $620 a month government subsidy for her health insurance, so she was delighted Thursday … ‘thank God, Hallelujah, that is so awesome – Oh man! I’m so happy. I’ve been so stressed about it and worried, just every day. I’ve been talking to my husband what are we going to do honey? And he just says have faith honey, it’s going to be okay. ’”

“Mary Kitchens, who lives near San Antonio Texas is paying less than $100 a month for her subsidized coverage. She began crying when informed of the decision. ‘I don’t even have words’ said Kitchens who was diagnosed with multiple sclerosis in 2009. ‘It’s amazing, it’s amazing.’

“Kitchens, who works in marketing for a real estate firm is a single mom with four children. The decision ‘means that I’ll have options in obtaining medication and treatment…. It means I won’t be a burden to my children. Without it, I felt so doomed. Without insurance, you succumb to the disease. And I don’t want to do that.’ Without it, her bill would have jumped to $500 to $600 a month.”

“Atlanta resident Ted Souris, 62, describes himself as an ‘archconservative’ who initially opposed the health law. He said her had mixed feelings about the ruling. He gets what he calls ‘a pretty hefty subsidy’ to buy insurance – he gets $460 and pays $115 for insurance. ‘I’m so against Obama and I hate that he has any kind of victory, but it’s nice that I don’t have to worry about affording health coverage.’”

“Tom Clark, of Waunakee Wis., who retired from his long time job at Canadian national Railway called the decision ‘a huge weight off my chest, a huge relief.’ In the months before coverage was available under the health law, he was cashing in on his pension fund to pay the $2,000 monthly premium for a plan that covered his wife, a diabetic who works as a clerk in a liquor store, and one of his two college-age sons. After the family signed up for coverage in December 2013, a subsidy reduced his monthly premium to about $580…. ‘If I had lost the subsidies, I don’t know what I would have done.”

Karen Tumulty interviewed strategists from both parties on the political impacts of the court’s decision for her article in today’s Washington Post. “Rick Wilson, a Florida based strategist for Republican candidates said he was relieved by the decisions which has given his party a reprieve from having to navigate these straits. ‘I’ve been telling clients for about a month now, listen, this is probably going to get passed, they’ll approve it, and you should not be freaked out by it, because otherwise you’re going to spend the next year and a half getting ads run against you where a weeping Hispanic woman looks at the camera and says ‘they took away my son’s health care. Now he’s dead.’ What I don’t want is a political environment where the next year and a half we’re in a ditch with people asking ‘what is your exact health care plan and then when we present one, it gets torn apart’… Anyone who thinks that’s a great political frame to put yourself in for 2016 hasn’t ever done an election.”

 

For ITUP’s analysis of King vs. Burwell click here.

Congratulations to Governor Brown, Senator Ricardo Lara and the State’s Legislative Leadership

Governor Jerry Brown signs $167 billion state budget with significantly increased funding for schools and $40 million for Medi-Cal coverage for immigrant children beginning by May 2016. Up to 170,000 children may qualify and the state will achieve near universal children’s coverage. Congratulations to Governor Brown, Senator Ricardo Lara and the state’s legislative leadership

 

 

ITUP Summary of Findings from the National Health Insurance Survey

The Centers for Disease Control, National Center for Health Statistics released its 2014 survey results on health insurance status for the nation.

Thirty-six million (11.5% of the nation’s residents) were uninsured at the time of their interview. The nation’s rate of uninsurance for adults fell from 22.3% in 2010 to 16.3% in 2014. The rate of uninsurance for young adults (19-25) fell from 33.9% in 2010 to 20.0% in 2014. The numbers of uninsured nationally fell from 48.6 million in 2010 to 36 million in 2014.

The percentages of uninsured ranged from highs of 21.5% in Texas and Oklahoma and 21.2% in Alaska to lows of 2.5% in Hawaii, 3.2% in Massachusetts and 3.3% in Washington D.C. California, which used to be competing with states like Texas and New Mexico for the highest uninsured rates, is now at 13.4%, just about the national average. Its uninsured rates for adults 18-64 fell from 24.4% in 2012 to 16.7% in 2014. Its uninsured rates for children fell from 6.7% in 2012 to 5.0% in 2014.

California’s rate of private insurance is 60.6%, below the national average of 63.6% and far below leading states like New Jersey (74.4%), Hawaii (72.8%) and Massachusetts (72.2%). Thirty-seven percent of those with private insurance are enrolled in high deductible health plans – a percentage that is increasing.

California’s rate of public insurance is 26.8%, a bit above the national average of 24.5% and far below the leaders such as Kentucky (36%), New Mexico (37.4%) and Washington DC (32.4%).

Between 2013 and 2014 as the ACA was implemented, the rates of uninsurance fell precipitously for the poor (39.3% to 32.3%) and near poor (28.5% to 30.9%), falling as well as for the non-poor (11.4% to 8.9%).

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States with state-based Exchanges like California had a sharper reduction in their uninsured rates between 2013 and 2014 than did those states with federal Exchanges, and they had strong growth in their rates of private insurance.

States with Medicaid expansions like California achieved sharper reductions in their uninsured rates (18.4% to 13.3%) between 2013 and 2014 than did those states, which refused to expand Medicaid (22.7% to 19.6%).

The results are that states which have resisted ACA implementation like Texas and Oklahoma have maintained their very high rates of uninsured while states like California and New Mexico (21% uninsured in 2012 to 14% uninsured in 2014) that have enthusiastically implemented it have seen large reductions in their rates of uninsured.

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ITUP’s Summary of “Coverage Expansions and the Remaining Uninsured”

Coverage Expansions and the Remaining Uninsured: a Look at California During Year One of ACA Implementation (Kaiser Family Foundation, May 2015) is an excellent overview of the impacts of the Medicaid (Medi-Cal) and Covered California expansions. This is the report on Year 1.

The highlights are as follows:

  • The newly insured and the remaining uninsured resemble each other in age, income and health status. They differ primarily on the basis of their immigration status.
  • The Medi-Cal and Covered California enrolled populations are far more ethnically diverse than those with private insurance.
  • Covered California provides a significant source of coverage for working families not offered coverage at the workplace – 75% are workers and families.
  • One fifth of the newly insured reported changing their source of care, primarily for convenience – closer to home or work.
  • The newly insured are now far more likely to have a regular source of care than the uninsured, but still less so than the previously insured.
  • Both Medi-Cal and Covered California enrollees use clinics as a source of care, but far higher percentages (44%) of Coverage California enrollees use private doctors. Fifty-seven percent of those with Medi-Cal use clinics; 32% of those with Covered California use clinics, and 15% of those with other private insurance.
  • For the uninsured, the principal reason for choosing their source of care was affordability; for the newly insured it was convenience, and for the previously insured it was pre-existing relationship with their doctor.
  • Providers were more likely to refuse to treat Covered California enrollees (13%) than either Medi-Cal (8%) or other privately insured (3%) patients.
  • Price was the most important determinant (37%) for Covered California enrollees in selecting a plan.
  • Thirty-five percent of the newly insured had a hard time understanding their plan’s coverage as compared to 20% of the already insured.
  • Forty-four percent of newly insured Covered California enrollees reported difficulty paying their premiums as opposed to 1/4th of adults with other coverage (i.e. employers), but they reported far lower rates of difficulty paying their medical bills and less worry about their ability to access and pay for their medical care than did the uninsured.
  • Most (64%) of the remaining uninsured did not try to apply for coverage because they believed it would be too expensive. A third did apply but were told they were ineligible (38%) or decided it was too expensive (21%).
  • Forty-four percent of the remaining uninsured identified cost as the reason they were uninsured; 3% said it was because they opposed the ACA or preferred to pay the penalty.
  • Half of the remaining uninsured indicated that they planned to get coverage in 2015, — through work (7%), through Covered California (3%) or Medi-Cal (8%), but most (28%) simply weren’t sure.
  • The remaining uninsured are less likely to report they have an ongoing condition, less likely to be taking medication, but more likely to report that they are in fair to poor health than the newly insured or already insured.

This summary can be downloaded here.