Health Care Public Policies

Watchdog Vigilance Home Page

The content of this web page is arranged under the following headings:
1. American Health Care Act (Trumpcare #1)
    1.A. Advocacy Group Position Statements
    1.B. Congressional Budget Office Cost Estimate
    1.C. Consequences of Significantly Lower Medicaid Enrollment
2. Better Care Reconciliation Act (Trumpcare #2)
    2.A. Congressional Budget Office Cost Estimate 
    2.B. Well-To-Do Welfare
    2.C. ACT NOW: Oppose BCRA
3. ACT NOW: Oppose Graham-Cassidy Bill
4. Affordable Care Act (Obamacare)
    4.A. Summary
    4.B. Health Care Improvements  
    4.C. ACT NOW: Oppose ACA Repeal 
5. Insurance Coverage Mandate
6. Preventive Care
7. Contraceptive Options
8. Essential Health Benefits
9. Medicaid Coverage
10. Self-Insured Coverage
11. Pertinent Historical Data
    11.A. National Health Expenditures
    11.B Federal Government Health Programs Spending
    11.C. National Debt History
12. Employee Health Benefits
13. Medicare Expansion (ME) single-payer health care proposal    

1. American Health Care Act (Trumpcare #1)

1.A. Advocacy Group Position Statements

Listed online at http://www.finplaneducation.net/AHCA_position_statements.htm are 53 advocacy groups that oppose – and 22 advocacy group that support – the version of the American Health Care Act that was passed by the United States House of Representatives on May 4, 2017. Please send an E-mail to taxless3@comcast.net if you know other advocacy groups that have taken a position on the American Health Care Act.

1.B. Congressional Budget Office Cost Estimate

On May 24, 2017, the Congressional Budget Office (CBO) issued a “Cost Estimate” for the American Health Care Act (AHCA) as passed by the United States House of Representatives on May 4, 2017: see https://www.cbo.gov/system/files/115th-congress-2017-2018/costestimate/hr1628aspassed.pdf. The CBO Cost Estimate conclusions are summarized online at http://www.finplaneducation.net/cbo_cost_estimate.htm.

1.C. Consequences of Significantly Lower Medicaid Enrollment

The Congressional Budget Office reports that the American Health Care Act (AHCA) passed by 217 Republicans in the U.S. House of Representatives on May 4 would lower Medicaid enrollment throughout the coming decade, culminating in 14 million fewer Medicaid enrollees by 2026: see http://www.finplaneducation.net/cbo_cost_estimate.htm.

The latest available Medicaid enrollment data at https://www.medicaid.gov/medicaid/program-information/medicaid-and-chip-enrollment-data/report-highlights/index.html reveals that Medicaid provides health coverage to 68,965,776 eligible low-income adults, children, pregnant women, elderly adults, and people with disabilities. The 68,965,776 individual Americans now enrolled in Medicaid is 21% of the total U.S. resident population of 326,626,000 – one in five of our family members, friends, and neighbors are now enrolled in Medicaid.

What happens to “those people” if there are 14 million fewer Medicaid enrollees in 2026? The Indiana answer to this question includes the medical options for the uninsured listed next.

Presumptive Eligibility (PE): see http://member.indianamedicaid.com/programs--benefits/medicaid-programs/presumptive-eligibility-(pe).aspx. PE is a process that offers short-term coverage of services. The goal of the program is to make sure patients have immediate access to health care. A patient must live in Indiana and the family income must be below a certain amount. This short-term coverage will end if a patient does not successfully complete a Medicaid application by the end of the next month. Patients who qualify as a Parent/Caretaker, Infant, Child, or Former Foster Child will be eligible for all services covered under Hoosier Healthwise Package A. Patients who qualify as a Pregnant Woman will be eligible for (a) doctor visits, tests, lab work, and other care for the pregnancy, (b) dental care, (c) prescription drugs, and (d) transportation services to doctor appointments – labor and delivery costs will not be covered. Patients who qualify for the Family Planning Eligibility Program will be eligible for family planning visits, laboratory tests, pap smears, condoms, and birth control. Patients who qualify as an Adult will be eligible for services covered under the Healthy Indiana Plan Basic Plan and will be required to pay copays for all services.

Charitable Care By Nonprofit Hospitals. Charitable care by nonprofit hospitals is mandated by Indiana Code sections 16-21-6-0.1 to 16-21-6-12 and 16-21-9-1 to 16-21-9-9. Under the state’s community benefits law, each nonprofit hospital must meet certain requirements for notifying patients about their free care policies and must file annual reports about their amount of free charity care and other community benefits. Nonprofit hospitals are also required to develop a community benefit plan that includes goals and objectives for providing charity care and government sponsored indigent health care. The State Department of Health oversees nonprofit hospital compliance with charitable care reporting requirements. Hospitals set their own eligibility guidelines for charity care and financial assistance.

County Hospitals. If there is one, patients can check with their local county hospital for programs that provide medical care at a low cost or sliding fee scale.

Hospital Care for the Indigent Program (HCIP). HCIP for the uninsured indigent is authorized by Indiana Code sections 12-16-2.5 to 12-16-16.5-3. The Indiana Division of Family Resources administers HCIP. HCIP provides financial assistance for emergency hospital care. Funding for HCIP is included in the state budget – $29.5 million is currently budgeted for both Fiscal Years 2018 and 2019. Indiana residents are eligible HCIP if (a) they meet the appropriate income and resource requirements and (b) the absence of medical care would place the patient in risk of death or serious bodily harm. Indiana non-residents are eligible for HCIP provided that the onset of the medical condition occurred in Indiana. Patients determined to be eligible for the HCIP are not financially obligated for emergency services; for Indiana residents, services to treat conditions resulting from receiving emergency care are also covered. st1\\:*{behavior:url(#ieooui) } HCIP assistance to eligible hospital patients is not available until the onset of a medical condition which, in the absence of immediate medical attention, would probably result in (a) placing the patient's life in danger, (b) serious impairment to bodily functions, or (c) serious dysfunction of any bodily organ or part. Assistance is only available until the patient is medically stable and can be safely discharged. Notably, in-patient and out-patient physician services can be covered under HCIP as long as the treatment is a direct consequence of the emergency medical condition and the services are provided in the Emergency medical transportation costs can also be covered services. If covered services extend over more than one month, a separate eligibility determination is required for each month. Under the Hospital Financial Disclosure Law, hospitals must file patient information reports – including whether the patient was charged as a “charity care” patient – with the State Department of Health within 120 days of the close of each calendar quarter.

Indigent Drug Programs. Patients with low incomes who are not eligible for Medicaid or other prescription coverage may benefit from one of the indigent drug programs offered by drug manufacturers. Hospital social workers often help patients apply to indigent drug programs.

County and City Health Departments. Patients can check with their county health department and city health department (if there is one) for a reference to special programs, such as for immunizations.

Township Trustee. If patients are not eligible for Medicaid or any other medical program (or their application for such a program is pending), the patients may be eligible for trustee assistance. This assistance could include doctor’s fees, prescriptions, and many other medical needs. The township trustee must take a written application from a patient and provide a written decision about what help the patient will receive. Income and resource rules vary from township to township.

Veteran’s Healthcare. In order for a patient to be eligible for enrollment for Veteran’s healthcare, the patient must have (a) been discharged from active military service under honorable conditions, (b) served a minimum of 2 years if discharged after September 7, 1980 (prior to this date there is not a time limit), and (c) if the patient was a National Guardsman or Reservist, served the entire period for which the patient was called to active duty other than for training purposes only. The VA will determine a patient’s eligibility using 7 different categories for veterans. The categories have to do with whether the patient has a service-connected injury or illness and what type of injuries or illnesses were identified on the physical when the patient left the service. The amount of healthcare a patient can receive is based on the category the VA determines.

Doctor or Health Care Provider. Patients can talk with their doctor or health care provider to discuss options to pay for care.

Other Private Revenues. Other private revenues are commonly provided through philanthropy. Philanthropic support may be direct from individuals or may be obtained through philanthropic fund-raising organizations (such as the United Way) or other foundations or corporations. Philanthropic revenues may be spent directly for patient care or may be held in an endowment fund to produce income to cover current expenses. Nationwide in 2015, other private revenues covered $124.259 billion (or 3.88%) of the total national health expenditures of $3.205560 trillion. Other philanthropic private revenues cannot realistically be expected to make up for the annual uninsured national health care costs of about $83 billion that would result if 14 million enrollees lost their Medicaid insurance coverage.

American Health Care Act (AHCA) High-Risk Pools. Before the Affordable Care Act, 35 states had high-risk pools. The AHCA would allow states to opt out of the requirement for insurers to cover people with preexisting conditions and again set up high-risk pools for these people instead. High-risk pools are state health insurance plans that provide coverage if a person has been locked out of the individual insurance market because of a pre-existing condition. High-risk pool plans offer health insurance coverage that is subsidized by a state government. However, a person’s high-risk pool premium is typically somewhat more than what is paid by a healthy person for individual health insurance coverage. The historical problem with high-risk pools was that both premiums and other out-of-pocket costs remained too high for many people with preexisting health conditions to afford. Also, sometimes the pools got so expensive for states that they had to impose waiting lists for coverage. A late AHCA amendment to add $8 billion in additional funding over five years to help reduce high-risk pool premiums will do little to re-insure the 14 million enrollees who would loose their Medicaid insurance coverage.

This review of uninsured medical options clearly shows that there are insufficient, temporary, hit-or-miss, replacements for the comprehensive Medicaid health insurance that would be lost by the 14 million enrollees under the American Health Care Act. In particular, the uninsured medical options do not provide the quality preventive care included in Medicaid health insurance plans.

2. Better Care Reconciliation Act (Trumpcare #2)

2.A. Congressional Budget Office Cost Estimate

On June 26, 2017, the Congressional Budget Office (CBO) issued a “Cost Estimate” for the Better Care Reconciliation Act (BCRA) being considered by the United States Senate to change the nation’s health care delivery system: see https://www.cbo.gov/system/files/115th-congress-2017-2018/costestimate/52849-hr1628senate.pdf.

2.B. Well-To-Do Welfare

NOTE: The source documents for the data cited in this analysis include the following:
(a) Better Care Reconciliation Act (BCRA) Congressional Budget Office Cost Estimate at https://www.cbo.gov/system/files/115th-congress-2017-2018/costestimate/52849-hr1628senate.pdf,
(b) Fiscal Year 2018 U.S. Government Budget proposed by President Donald Trump can be found online at https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/budget/fy2018/budget.pdf,
(c) “Donald J. Trump’s Tax Plan” document at https://assets.donaldjtrump.com/trump-tax-reform.pdf,
(d) June 2015 Ball State University Report "The Myth and the Reality of Manufacturing in America" at http://conexus.cberdata.org/files/MfgReality.pdf.

The Better Care Reconciliation Act (BCRA) that is being considered by the United States Senate to change the nation’s health care delivery system, together with the proposed Fiscal Year 2018 U.S. Government Budget, include provisions that would provide “Welfare” in the form of generous tax cuts for the Well-To-Do (prosperous corporations and high-income individuals).

The BCRA includes the tax cuts listed next for Well-To-Do corporations and individuals.

(1) $172 billion total 2017-2026 to large employers from eliminating the penalties associated with the requirements that the large employers offer their employees health insurance coverage that meets specified standards (also called the employer mandate).

(2) $144.7 billion total 2018-2026 to health insurance companies from repealing the Health Insurance Tax.

(3) $66.0 billion total 2020-2026 to mostly health insurance companies (and some employers) from repealing the Tax on Employee Health Insurance Premiums and Health Plan Benefits for employer-sponsored health plans with aggregate values that exceed threshold values.

(4) $25.7 billion total 2018-2026 to pharmaceutical manufacturers from repealing the Tax on Prescription Medications.

(5) $19.6 billion total 2018-2026 to medical device sellers from repealing the Medical Device Excise Tax (2.3% excise tax on sales).

(6) $5 billion total 2017-2026 to health care providers from lowering the federal government limit on the amount of health care provider taxes that states can collect without incurring reductions in federal Medicaid payments (from 6 percent of a provider’s net revenues from services for patients to 5.8 percent in 2021 and further lowered by 0.2 percentage points annually until the threshold reached 5.0 percent).

(7) $1.8 billion total 2018-2026 to employers from repealing the Elimination of Tax Deduction for Expenses Allocable to Medicare Part D Retiree Drug Subsidy Payments.

(8) $172.2 billion total 2017-2026 to individual taxpayers earning over $200,000 and married couples filing jointly earning over $250,000 from repealing the Net Investment Tax of 3.8% on unearned income.

(9) $58.6 billion total 2022-2026 to individual taxpayers earning over $200,000 and married couples filing jointly earning over $250,000 from repealing the Medicare Tax Increase on earnings of 2.35% (from 1.45%).

In addition to the $434.8 billion in tax cuts for prosperous corporations and the $230.8 billion in tax cuts for high-income individuals, the BCRA would also provide $321 billion – primarily from $722 billion in reduced Medicaid spending – for tax cuts in the proposed Fiscal Year 2018 U.S. Government Budget. Some of these federal budget tax cuts would be enjoyed by prosperous American corporations in the form of a tax rate reduced to 15% of business income.

The corporate income tax cut would supposedly stimulate significant GDP growth in the economy, fuel job creation, and increase after-tax worker wages. In reality, the increased profits from the corporate income tax cut would first be used for other corporate priorities before any new higher-wage jobs are created.

(1) Corporate executives will first seek to increase their compensation if their corporate profits increase because of a corporate income tax cut. The AFL-CIO reports that, in 2016, CEOs of S&P 500 Index companies received an average of $13.1 million in total compensation. In contrast, production and nonsupervisory workers earned only an average of $37,632 – a CEO-to-worker pay ratio of 347 to 1.

(2) Corporate executives would next apply profits from a corporate income tax cut to stock buybacks, thereby increasing the stock price of the numerous shares of corporate stock that they own.

(3) The next use of corporate profits from an income tax cut would be to increase stock dividends – again increasing the stock price of the corporate shares owned by the corporate executives.

(4) Profits from a corporate income tax cut would be spent on automation before new workers are hired. The June 2015 Ball State University Report "The Myth and the Reality of Manufacturing in America" shows that most of the decline in U.S. manufacturing employment from 2000 to 2010 wasn’t due to trade, but productivity gains from automation. Productivity gains accounted for 87 percent of lost manufacturing jobs, while trade was responsible for just 13 percent.

(5) Hiring new workers at higher wages would be the last option for the use of increased profits from a corporate income tax cut.

The chances for significant economic growth, job creation, and worker wage increases from corporate income tax cuts are limited by today’s business realities.

Medicaid provides health coverage to 69 million Americans, including eligible children, pregnant women, low-income adults, elderly adults (including many in nursing homes), and people with disabilities. IF you believe that every U.S. resident should receive comprehensive and affordable health care irrespective of their social status, income, age, gender, race, pre-existing condition, or wealth – then it is poor public policy to slash Medicaid spending to provide Well-To-Do Welfare to prosperous corporations and high-income individuals in the form of tax cuts that cannot be expected to significantly increase economic growth, job creation, and worker wages.

2.C. ACT NOW: Oppose BCRA

Below is a letter E-mailed to both Indiana U.S. Senators regarding the Better Care Reconciliation Act (BCRA) being considered by the United States Senate to change the nation’s health care delivery system. Everyone who has an opinion on the BCRA is urged to let their U.S. Senators know what they think. Contact information for your U.S. Senators can be accessed by using the “Find Your Senators” drop-down list at the upper left corner of the https://www.senate.gov/ website.

I insist that you Vote No against the Better Care Reconciliation Act (BCRA) being considered by the United States Senate to change the nation’s health care delivery system as long as the harmful provisions listed next remain in the bill.

The Congressional Budget Office reports that under the current ACA law the subsidies to purchase coverage, combined with the effects of the individual mandate (which requires most individuals to obtain insurance or pay a penalty) are anticipated to cause sufficient demand for insurance by enough people for the health insurance market to be stable in most areas. Nevertheless, a small number of people live in areas of the country that have limited participation by insurers in the nongroup market under the current ACA law because of a lack of profitability, substantial uncertainty about enforcement of the individual mandate, and uncertainty about future payments of the cost-sharing subsidies to reduce out-of-pocket payments for people who enroll in nongroup coverage through the ACA marketplaces. Therefore, I want you as my U.S. Senator to NOT repeal the ACA but to improve the ACA by making the ACA nongroup marketplaces more stable. One compelling proposal to stabilize the ACA nongroup marketplaces has been offered by Missouri Senator Claire McCaskill – uninsured people in counties throughout the nation with no nongroup health insurer would be allowed to obtain insurance through the national plans sold by the Washington DC based “Health Link” where most members of Congress and their staff purchase health insurance.

3. ACT NOW: Oppose Graham-Cassidy Bill

Please ACT NOW and contact both of your U.S. Senators to let them know that you want them to oppose the Graham-Cassidy bill that would severely disrupt the American Health Care System and, instead, return to “regular order” to pass a bill that IMPROVES the American Health Care System. Contact information for your U.S. Senators can be accessed by using the “Find Your Senators” drop-down list at the upper left corner of the https://www.senate.gov/ website.

The reasons for taking action now are included in the following eloquent statement that was issued today by U.S. Senator John McCain:

“As I have repeatedly stressed, health care reform legislation ought to be the product of regular order in the Senate. Committees of jurisdiction should mark up legislation with input from all committee members, and send their bill to the floor for debate and amendment. That is the only way we might achieve bipartisan consensus on lasting reform, without which a policy that affects one-fifth of our economy and every single American family will be subject to reversal with every change of administration and congressional majority.

“I would consider supporting legislation similar to that offered by my friends Senators Graham and Cassidy were it the product of extensive hearings, debate and amendment. But that has not been the case. Instead, the specter of September 30th budget reconciliation deadline has hung over this entire process.

“We should not be content to pass health care legislation on a party-line basis, as Democrats did when they rammed Obamacare through Congress in 2009. If we do so, our success could be as short-lived as theirs when the political winds shift, as they regularly do. The issue is too important, and too many lives are at risk, for us to leave the American people guessing from one election to the next whether and how they will acquire health insurance. A bill of this impact requires a bipartisan approach.

“Senators Alexander and Murray have been negotiating in good faith to fix some of the problems with Obamacare. But I fear that the prospect of one last attempt at a strictly Republican bill has left the impression that their efforts cannot succeed. I hope they will resume their work should this last attempt at a partisan solution fail.

“I cannot in good conscience vote for the Graham-Cassidy proposal. I believe we could do better working together, Republicans and Democrats, and have not yet really tried. Nor could I support it without knowing how much it will cost, how it will affect insurance premiums, and how many people will be helped or hurt by it. Without a full CBO score, which won’t be available by the end of the month, we won’t have reliable answers to any of those questions.

“I take no pleasure in announcing my opposition. Far from it. The bill’s authors are my dear friends, and I think the world of them. I know they are acting consistently with their beliefs and sense of what is best for the country. So am I.

“I hope that in the months ahead, we can join with colleagues on both sides of the aisle to arrive at a compromise solution that is acceptable to most of us, and serves the interests of Americans as best we can.”

4. Affordable Care Act (Obamacare)

4.A. Summary

A summary of the various Affordable Care Act provisions can be found online at http://www.finplaneducation.net/affordable_care_act.htm.

4.B. Health Care Improvements

Every U.S. resident should receive comprehensive and affordable health care irrespective of their social status, income, age, gender, race, pre-existing condition, or wealth. For-profit health insurance companies and employers did a poor job of providing comprehensive and affordable health care prior to the March 2010 passage of the Affordable Care Act (ACA).

Before the ACA, state regulators allowed inefficient health insurance companies and employer-sponsored group health insurance plans to maximize their profits at the expense of policy owners and employees by approving discriminatory practices such as those listed next.

A. Health insurance applicants could be denied coverage because of pre-existing conditions.

B. Persons denied health insurance coverage because of pre-existing conditions were eligible for high-risk pools. However, high-risk pool insurance premiums were so high that many persons with pre-existing conditions could not afford to purchase the health insurance coverage.

C. Health insurance companies were allowed to impose annual and lifetime limits on the dollar value of coverage. In other words, insurance company executive committees were allowed to be death panels by limiting the coverage for catastrophic illnesses and injuries.

D. Health insurance policies could be issued that provided limited coverage. The ACA requires, as a minimum, that insurance policies cover the following essential health benefits: (1) ambulatory patient services (outpatient care); (2) emergency services; (3) hospitalization (inpatient care); (4) maternity and newborn care; (5) mental health and substance use disorder services, including behavioral health treatment; (6) prescription drugs; (7) rehabilitative and habilitative services and devices; (8) laboratory services; (9) preventive and wellness services, including chronic disease management; and (10) pediatric services, including oral and vision care.

E. Health insurance premium rates could vary based on the sex of the policy owner. The ACA allows rating variation based only on age (limited to 3 to 1 ratio), premium rating area, family composition, and tobacco use (limited to 1.5. to 1 ratio).

F. Health insurance companies were allowed to rescind coverage.

For-profit health insurance companies and employers also had little incentive to control runaway health care costs because they could easily pass along the increasing costs in the form of premium and deductible increases.

It would be easy to implement a single-payer system similar to Medicare to provide comprehensive and affordable health care to all U.S. residents WITHOUT adding to the federal debt. Every individual income tax payer could pay their “fair share” of 2.094719 times the amount of the Individual Income Tax they pay to cover all of today’s health care costs except for Workers Compensation and investments in research, structures, and equipment. See the Medicare Expansion (ME) proposal at http://www.finplaneducation.net/medicare_expansion.htm.

There was not sufficient political will – or sufficient common decency – to adopt a single-payer system when the ACA was passed. In order to appease the health insurance lobbyists, the ACA had to implement a Rube Goldberg-type of health care system to entice everyone (especially healthy young people) to enroll in health insurance at a fair price. The provisions of the ACA legislation are summarized at http://www.finplaneducation.net/affordable_care_act.htm under the following headings:
1. Individual Mandate
2. Employer Requirements
3. Expansion of Medicaid
4. Expansion of Children’s Health Insurance Program (CHIP)
5. Premium and Cost-Sharing Subsidies to Individuals
6. Premium Subsidies to Employers
7. Tax Changes Related to Health Insurance
8. Tax Changes Related to Financing Health Reform
9. Health Insurance Exchanges
10. Essential Benefits Package
11. Temporary High Risk Pool
12. Changes to Private Insurance
13. State Role
14. Medicare and Medicaid Cost Containment
15. Other Cost Containment
16. Improving Quality/Health System Performance
17. Prevention/Wellness
18. Long-Term Care
19. Medicare Improvements
20. Healthcare Workforce Training and Development Improvements
21. Other Program Investments

In spite of some of the complexities that could be eliminated with a single-payer system, the ACA is a significant improvement to help reach the goal of providing comprehensive and affordable health care to every U.S. resident irrespective of their social status, income, age, gender, race, pre-existing condition, or wealth. Repealing the Affordable Care Act and letting for-profit health insurance companies and employers resume their pre-ACA discriminatory practices would be a travesty.

4.C. ACT NOW: Oppose ACA Repeal

Republicans in the U.S. Senate propose that H.R. 3762, the Restoring Americans’ Healthcare Freedom Reconciliation Act of 2015 (which was vetoed by President Obama), be once again passed to repeal portions of the Affordable Care Act (ACA).

H.R. 3762 would make two primary sets of changes that would affect insurance coverage and premiums. First, upon enactment, the bill would eliminate penalties associated with the requirements that most people obtain health insurance (also known as the individual mandate) and that large employers offer their employees health insurance that meets specified standards (also known as the employer mandate). Second, beginning roughly two years after enactment, the bill would also eliminate the ACA’s expansion of Medicaid eligibility and the subsidies available to people who purchase health insurance through a marketplace established by the ACA.

H.R. 3762 would also leave in place a number of rules established by the ACA that require insurers who sell plans either through the marketplaces or directly to consumers to provide specific benefits and amounts of coverage; not deny coverage or vary premiums because of an enrollee’s health status or limit coverage because of preexisting medical conditions; and vary premiums only on the basis of age, tobacco use, and geographic location. Leaving these ACA market reforms in place would limit insurers’ ability to use strategies that were common before the ACA was enacted. For example, insurers would not be able to vary premiums to reflect an individual’s health care costs or offer health insurance plans that exclude coverage of preexisting conditions, plans that do not cover certain types of benefits (such as maternity care), or plans with very high deductibles or very low actuarial value (plans paying a very low share of costs for covered services).

Some other H.R. 3762 provisions include the following: (a) repealing the federal excise tax imposed on some health insurance plans with high premiums; (b) repealing the Hospital Insurance payroll tax rate for high-income taxpayers, (c) repealing a surtax on the net investment income of high-income taxpayers; (d) repealing annual fees on health insurers; (e) repealing reductions to state allotments for Medicaid payments to hospitals that treat a disproportionate share of uninsured or low income patients; (f) eliminating the Prevention and Public Health Fund and rescinding any unobligated balances of the fund; (g) terminating the enhanced federal matching rate for personal care attendant services and supports provided under the Community First Choice Act beginning in calendar year 2018; (h) increasing the amount of funding authorized and appropriated to the Community Health Center Fund and for grants to states to address substance abuse; (i) prohibiting federal Medicaid funds from being made available, for one year, to Planned Parenthood; and (j) repealing a portion of the Medicaid funding provided to U.S. territories.

The January 2017 Congressional Budget Office (CBO) document “How Repealing Portions of the Affordable Care Act Would Affect Health Insurance Coverage and Premiums” presents the changes that are summarized next in health insurance coverage and premiums that would result from passing H.R. 3762: see https://www.cbo.gov/system/files/115th-congress-2017-2018/reports/52371-coverageandpremiums.pdf and https://www.cbo.gov/publication/52371.

A. Health Insurance Coverage Effects.

A.1. The number of people who are uninsured would increase by 18 million in the first new plan year following enactment of H.R. 3762. This increase in the uninsured population would consist of about 10 million fewer people with coverage obtained in the nongroup market, roughly 5 million fewer people with coverage under Medicaid, and about 3 million fewer people with employment-based coverage. Most of those reductions in coverage would stem from repealing the penalties associated with the individual mandate. However, health insurers in some areas would leave the nongroup market in the first new plan year following enactment in anticipation of further reductions in enrollment and higher average health care costs among enrollees who remained after the subsidies for insurance purchased through the marketplaces were eliminated. As a consequence, roughly 10 percent of the U.S. population would be living in an area that has no insurer participating in the nongroup market.

A.2. Later, after the elimination of the ACA’s expansion of Medicaid eligibility and of subsidies for insurance purchased through the ACA marketplaces, the number of uninsured people would increase to 27 million, and then would continue to increase each subsequent year to 32 million in 2026 (relative to the number of uninsured people expected under the current ACA law). The estimated increase of 32 million people without coverage in 2026 is the net result of roughly 23 million fewer with coverage in the nongroup market and 19 million fewer with coverage under Medicaid, partially offset by an increase of about 11 million people covered by employment-based insurance.

A.3. By 2026, 59 million people under age 65 would be uninsured in 2026 (compared with 28 million under the current ACA law) – 21 percent of people under age 65 would be uninsured.

A.4. By 2026, fewer than 2 million people would be enrolled in the nongroup market.

A.5. The ACA’s changes to the rules governing the nongroup health insurance market work in conjunction with the mandates and the subsidies to increase participation in the market and encourage enrollment among people of different ages and health statuses. But eliminating the penalty for not having health insurance would reduce enrollment and raise premiums in the nongroup market. Eliminating subsidies for health insurance purchased through the marketplaces would have the same effects because it would result in a large price increase for many people. Not only would enrollment decline, but the people who would be most likely to remain enrolled would tend to be less healthy (and therefore more willing to pay higher premiums). Thus, average health care costs among the people retaining coverage would be higher, and health insurers would have to raise premiums in the nongroup market to cover those higher costs.

A.6. About half of the nation’s population would live in areas that would have no health insurer participating in the nongroup market in the first year after the repeal of the marketplace subsidies took effect, and that share would continue to increase, extending to about three-quarters of the population by 2026. That contraction of the market would most directly affect people without access to employment-based coverage or public health insurance.

B. Health Insurance Premiums Effects.

B.1. Premiums in the nongroup market (for individual policies purchased through the marketplaces or directly from insurers) would increase by 20 percent to 25 percent – relative to projections under the current ACA law – in the first new health insurance plan year following the enactment of H.R. 3762. The majority of this premium increase would stem from repealing the penalties associated with the individual mandate. Doing so would both reduce the number of people purchasing health insurance and change the mix of people with insurance – tending to cause smaller reductions in coverage among older and less healthy people with high health care costs and larger reductions among younger and healthier people with low health care costs. Thus, average health care costs among the people retaining coverage would be higher, and insurers would have to raise premiums in the nongroup market to cover those higher costs. Lower participation by insurers in the nongroup market would place further upward pressure on premiums because the market would be less competitive.

B.2. The effects of H.R. 3762 on insurance premiums would be greater once the repeal of the Medicaid expansion and the subsidies for insurance purchased through the marketplaces took effect, roughly two years after enactment. The increase would reach about 50 percent (relative to projections under the current ACA law) in the year following the elimination of the Medicaid expansion and the marketplace subsidies, and premiums would continue to increase each subsequent year to about double by 2026.

IN CONCLUSION – if you believe that every U.S. resident should receive comprehensive and affordable health care irrespective of their social status, income, age, gender, race, pre-existing condition, or wealth – then using the provisions in H.R. 3762 to repeal portions of the Affordable Care Act is poor public policy because so many U.S. residents will lose their health insurance coverage or suffer huge health insurance premium increases.

NOTE: A small number of people live in areas of the country that have limited participation by insurers in the nongroup market under the current ACA law because of a lack of profitability, substantial uncertainty about enforcement of the individual mandate, and uncertainty about future payments of the cost-sharing subsidies to reduce out-of-pocket payments for people who enroll in nongroup coverage through the ACA marketplaces. Our U.S. Senators should NOT repeal the ACA but improve the ACA by making the ACA nongroup marketplaces more stable. One compelling proposal to stabilize the ACA nongroup marketplaces has been offered by Missouri Senator Claire McCaskill – uninsured people in counties throughout the nation with no nongroup health insurer would be allowed to obtain insurance through the national plans sold by the Washington DC based “Health Link” where most members of Congress and their staff purchase health insurance.

5. Insurance Coverage Mandate

Companies and individuals are mandated to buy insurance under the Affordable Care Act (ACA). The U.S. Department of Health and Human Services (HHS) is granted "really broad authority" to exempt persons from the mandate as well as to decide who can buy insurance on the federal and state exchanges outside of open-enrollment periods. Currently, "hardship exemptions" are available to persons for whom insurance would be too costly for a variety of reasons. The Centers for Medicare and Medicaid Services reduced the types of life circumstances (such as a move or marriage) that can trigger "special enrollment periods," but the agency could make it even more stringent. Rather than subjecting companies to fines if they do not offer insurance to employees, HHS could also allow them to put money into health reimbursement accounts so workers could then use the money to buy insurance on the ACA exchanges. (Source: Article in the USA Today section of The Indianapolis Star on January 22, 2017.)

Catastrophic insurance plans, which typically had lower premiums and were mostly insurance against the costliest diseases or accidents, were grandfathered in the Affordable Care Act (ACA) for a couple years but are no longer an option to meet the insurance mandate. Young people under age 30 can get catastrophic plans on the exchanges and people older than 30 can also buy these plans if they get a hardship exemption - so can those whose ACA plans are cancelled because they don't comply with the law. (Source: Article in the USA Today section of The Indianapolis Star on November 21, 2016.)

6. Preventive Care

The Affordable Care Act covers preventive care in full, such as physicals and mammograms. However, the U.S. Department of Health and Human Services has considerable leeway in how it defines "preventive care." (Source: Article in the USA Today section of The Indianapolis Star on January 22, 2017.)

7. Contraceptive Options

Under the Affordable Care Act, many insurers offer coverage for a wide range of contraceptive options from birth control pills and diaphragms to long-acting reversible contraception that can last up to 12 years. Insurers often place limits on how frequently patients can access their medical services, such as having an IUD replaced. Planned Parenthood offers programs to provide contraceptive options for free or at a reduced price for patients who don't have insurance or whose insurance doesn't cover them. The possibility of repealing the Affordable care Act raises concerns among some women that they will have to pay out of pocket for contraception. (Source: Article on Page 1A of The Indianapolis Star on November 29, 2016.)

Contraceptive coverage with no out-of-pocket costs is an administrative rule of the Affordable Care Act that is expected to be changed by the U.S. Department of Health and Human Services. (Source: Article in the USA Today section of The Indianapolis Star on January 22, 2017.)

8. Essential Health Benefits

NOTE: The Affordable Care Act requires that the following essential health benefits be covered: (1) ambulatory patient services (outpatient care); (2) emergency services; (3) hospitalization (inpatient care); (4) maternity and newborn care; (5) mental health and substance use disorder services, including behavioral health treatment; (6) prescription drugs; (7) rehabilitative and habilitative services and devices; (8) laboratory services; (9) preventive and wellness services, including chronic disease management; and (10) pediatric services, including oral and vision care. Some regulatory actions could make it possible for insurers to put limits on the number of days for hospital stays or that prescriptions have to be covered. (Source: Article in the USA Today section of The Indianapolis Star on January 22, 2017.)

The Better Care Reconciliation Act (BCRA) that was revised on July 13, 2017, is being considered by the United States Senate to change the nation’s health care delivery system. The revised BCRA would still provide funding to states to develop applications that would allow the states to meet fewer criteria to waive the current Affordable Care Act (ACA) requirement establishing the ten essential health benefits. Also, the ACA ban on annual and lifetime limits on covered benefits would no longer apply to health benefits not defined as essential in a state.

The Congressional Budget Office concludes that the BCRA would result in insurance covering certain services becoming more expensive – in some cases, extremely expensive – in some areas because the scope of the essential health benefits would be narrowed through waivers affecting close to half the population. For example, if the extended health benefits were modified to drop coverage of services that have high costs and are used by few people, coverage for maternity care, mental health care, rehabilitative and habilitative treatment, and certain very expensive drugs could be at risk. Also, people who used services or benefits no longer included in the extended health benefits would experience substantial increases in supplemental premiums or out-of-pocket spending on health care, or would choose to forgo the services. Furthermore, for some benefits that might be removed from a state’s definition of extended health benefits (but not be excluded from insurance coverage altogether), some enrollees could see large increases in out-of-pocket spending because annual or lifetime limits would be allowed.

A June 14. 2017, Kaiser Family Foundation (KFF) report shows how insurers might respond if states waive for close to half the U.S. population the current ACA requirement for essential health benefits: see http://www.kff.org/health-reform/issue-brief/would-states-eliminate-key-benefits-if-ahca-waivers-are-enacted/.

The KFF report reveals what percent of non-group insurance plans did not cover the benefits listed next prior to the current ACA law. This is an indication of how states could respond to the essential health benefits waiver authority included in the BCRA.

(1) Delivery and Inpatient Care for Maternity Care NOT covered by 75% of non-group insurance plans prior to the ACA. Among the relatively few plans that provided coverage for delivery and inpatient maternity care, a small share (3%) applied separate deductibles of at least $5,000 for maternity services and some plans (6%) applied a separate waiting period of at least year before benefits were available. A few plans restricted benefits to enrollees enrolled in family coverage or required that the enrollee’s spouse also be enrolled.

(2) Outpatient Substance Abuse Disorder Services NOT covered by 45% of non-group insurance plans prior to the ACA. For plans covering outpatient substance abuse disorder services, 22% limited the benefit to fewer than 30 visits or sessions and 12% limited it to 12 or fewer. In many of these plans, visits for either mental health or substance abuse care were combined to apply toward the same limit.

(3) Inpatient Substance Abuse Disorder Services NOT covered by 45% of non-group insurance plans prior to the ACA.

(4) Outpatient Mental/Behavioral Health Services NOT covered by 38% of non-group insurance plans prior to the ACA. Among plans with coverage for outpatient mental/behavioral health services, 23% limited benefits for some or all mental/behavioral services to fewer than 30 visits or sessions over a defined period (often a year) and 12% limited it to 12 or fewer. A small share (about 5%) of plans providing coverage for outpatient mental/behavioral health services provided benefits only for conditions defined as severe mental disorders or biologically-based illnesses or applied limits (such as visit limits) if the illness was not defined as severe or biologically based. The definitions of these terms varied by state.

(5) Inpatient Mental/Behavioral Health Services NOT covered by 38% of non-group insurance plans prior to the ACA.

(6) Non-Preferred Brand Drugs NOT covered by 17% of non-group insurance plans prior to the ACA.

(7) Specialty Drugs NOT covered by 13% of non-group insurance plans prior to the ACA.

(8) Preferred Brand Drugs NOT covered by 11% of non-group insurance plans prior to the ACA.

(9) Generic Drugs NOT covered by 6% of non-group insurance plans prior to the ACA.

The BCRA presents state policymakers with a dilemma: they can reduce the essential health benefits to allow less expensive insurance options for their residents, but doing so would eliminate access to certain benefits for people who want and need them.

9. Medicaid Coverage

About 6.4 million low-income persons can't enroll in Medicaid or buy insurance on the exchange and get subsidies because their states did not expand Medicaid. The U.S. Department of Health and Human Services could delay the Affordable Care Act penalty for these persons when they remain uninsured. (Source: Article in the USA Today section of The Indianapolis Star on January 22, 2017.)

The Obama administration granted several states waivers from some of the rules governing their Medicaid programs if they expanded it to all adults under the federal poverty limit. They were not nearly as permissive as the Trump administration is likely to be. The flexibility for states could include requirements that even the lowest-income persons have to be working to get benefits. (Source: Article in the USA Today section of The Indianapolis Star on January 22, 2017.)

10. Self-Insured Coverage

Most major employers are "self-insured" so instead of insurance companies covering their workers' claims, they pay them. Even after the Affordable Care Act, these employers had a lot of flexibility in what they covered, and some did not even cover hospitalization. This was tightened through regulatory actions that could be reversed. (Source: Article in the USA Today section of The Indianapolis Star on January 22, 2017.)

In the employer-sponsored market, a health plan that was in place when the Affordable Care Act (ACA) was enacted March 2010 can be a grandfathered health plan if the employer does not significantly change cost sharing, benefits, employer contributions, or access to coverage. New employees can enroll in a grandfathered plan as long as the employer has maintained consecutive enrollment in the plan. Grandfathered plans are exempted from many of the ACA’s new requirements, but still must comply with other provisions, including: (1) provide a uniform explanation of coverage, (2) report medical loss ratios and provide premium rebates if medical loss ratios are not met, (3) prohibit lifetime and annual limits on essential health benefits, (4) extend dependent coverage to age 26, (5) prohibit health plan rescissions, (6) prohibit waiting periods greater than 90 days, and (7) prohibit coverage exclusions for pre-existing health conditions. Employers must decide whether to grandfather their insurance plans, which limits the changes they can make to their plans, or whether to comply with the full set of new health reform requirements. In 2015, 35% of firms offering health benefits offer at least one grandfathered health plan, and 25% of covered workers are enrolled in a grandfathered plan.

11. Pertinent Historical Data

11.A. National Health Expenditures

See http://www.finplaneducation.net/national_health_expenditures.htm.

11.B. Federal Government Health Programs Spending

See http://www.finplaneducation.net/federal_government_health.htm.

11.C. National Debt History

See http://www.finplaneducation.net/national_debt_history.htm.

12. Employee Health Benefits

See http://www.finplaneducation.net/employee_health_benefits.htm.

13. Medicare Expansion (ME)

Details regarding the Watchdog Vigilance Medicare Expansion (ME) single-payer health care proposal can be found online at http://www.finplaneducation.net/medicare_expansion.htm.

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This page was last updated on 01/24/18.