Geographic disparities and HR2300

HR2300 is the incoming Secretary of Health and Human Services, Rep. Price (R-GA), PPACA replacement bill. It does lots of things. One of those things is it replaces income based subsidies with age based subsidies.

Sec. 101. Refundable Tax Credit for Health Insurance Coverage
 Provides for refundable, age adjusted tax credits with amounts tied to average insurance on individual
market adjusted for inflation.1
o $1,200 for those between 18 to 35 years of age
o $2,100 for those between 35 and 50 years of age
o $3,000 for those who are 50 years and older
o $900 per child up to age 18

Besides being grossly inadequate in size, there is another problem with these subsidies. These subsidies will have massive geographic disparities. Individuals who live in low cost medical markets with large and healthy risk pools will see their subsidy cover a far higher percentage of their premium costs for a given actuarial value. Individuals who live in high cost medical markets will pay a lot more out of pocket for their premiums. Below is a map of every county on Healthcare.gov excluding Alaska. The pricing is the least expensive Silver plan with no subsidies for a forty year non-smoker. The range is significant. The least expensive Silver in the data set is thirteen counties in Texas at $199.28 per month. The most expensive non-Alaska coverage is three counties in Arizona at $754.74.

least-expensive-silver-2017

The subsidy in the price plan will let the Texas 40 year olds buy 70% AV coverage for less than $20 a month out of pocket. Given quite a few other moving parts in HR0-2300 I can’t get a firm estimate but this is a good ballpark estimate. However the subsidy for the three Arizona counties for a forty year old would be sufficient to buy 25% AV coverage and the individual is paying $500 out of pocket every month.

We’ve talked about county level inequities within PPACA through Silver Gapping and Silver Hacking

More importantly, people in Perry County who are getting subsidized will see the ACA working really well. They have good, cheap health insurance. However their cousins across the state are getting a raw deal compared to the great deal that they get in Perry County. This is especially true as we move up the income scale which means moving up the likely voter scale and influence scale.

The people in the cheap Texas counties will see the Price plan as a great deal, especially higher up the income scale as the current subsidies fade out and then fall off a cliff. The people who make under 400% FPL in Arizona will be getting a raw deal.



Congratulations, West Virginia

You screwed yourself good this time:

But that drop, it turns out, is even more pronounced among poor whites. Gallup-Healthways tells me that among whites without a college degree who have household incomes of under $36,000, the uninsured rate has dropped from 25 percent in 2013 to 15 percent now — a drop of 10 percentage points. It’s often noted that the law has disproportionately expanded coverage among African Americans and Latinos. That is correct, but it has also disproportionately expanded coverage among poor white people.

Now, it’s hard to know how many people we’re talking about here. But other evidence supports the idea that a lot of red state voters have gained coverage from the law. In some parts of rural Kentucky, the Medicaid expansion has greatly expanded coverage. And CBS News recently reported that even some Republican officials in the GOP-led states that expanded Medicaid are not prepared to see that evaporate. Gallup-Healthways numbers also show that the drop in the uninsured rate has outpaced the national average in some red states that have expanded Medicaid, like Kentucky, Arkansas, and West Virginia.

Did people benefiting from Obamacare who voted for Trump really expect repeal to happen? I think we need more reporting on this question. Yes, Trump did repeatedly say he would repeal Obamacare. But he also said he would replace it with “something terrific.” And he explicitly went out of his way to create the impression that he does not agree ideologically with Republicans who are hostile to government efforts to supply health care to those who can’t afford it.

Now, it’s always possible that many voters backed Trump in the full knowledge that their Obamacare might be repealed, for other reasons — because, for instance, he’ll supposedly bring manufacturing and coal jobs roaring back. Before long, those voters will learn whether their bet was a well-placed one. It’s also possible that Trump will surprise us all and insist on some kind of replacement that somehow preserves much of Obamacare’s coverage expansion. And a kick-the-can-down-the-road scenario which keeps deferring the harshest fallout from repeal is also a possibility.

About those jobs:

After campaigning as a champion of coal miners, Donald Trump is reportedly close to choosing for commerce secretary a New York billionaire who owned a West Virginia mine where a dozen miners were killed in 2006. Trump’s favored candidate, Wilbur Ross, also engineered buyouts that cost workers their benefits and their jobs. It’s a striking choice, considering Trump’s promises to improve the lives of coal miners and other working-class Americans.

Ross made his money collecting “distressed assets”—failing steel and textile mills in the Midwest and South, and coal mines in Appalachia. Dubbed the “the King of Bankruptcy,” Ross cut jobs, wages, pensions, and health benefits at the companies he acquired, and reaped the profits. In the early 2000s, Ross’s foray into the steel industry netted him a $267 million personal windfall, but stripped health-care benefits from more than 150,000 retired steelworkers. Then he moved on to the coal industry, at one point controlling as much as $1.2 billion in coal assets through his company, the International Coal Group.

I’m sure he has miners best interests at heart. Oh, about those miners:

Again and again, President-elect Donald Trump presented himself as the coal miners’ candidate. During the campaign, he promised to bring coal back into the economy, and jobs back into struggling Appalachian towns.

But now some in coal country are worried that instead of helping, Trump’s first actions will deprive miners — and their widows and children — of the compensation they can receive if they are disabled by respiratory problems linked to breathing coal mine dust.

That’s because buried in the Affordable Care Act are three sentences that made it much easier to access these benefits. If Trump repeals Obamacare — as he vowed to do before the election — and does not keep that section on the books, the miners will be back to where they were in 2009, when it was exceedingly difficult to be awarded compensation for “black lung” disease.

And just how many people fucked themselves? Kthug runs the numbers:

As Greg Sargent points out, the choice of Tom Price for HHS probably means the death of Obamacare. Never mind the supposed replacement; it will be a bust. So here’s the question: how many people just shot themselves in the face?
My first pass answer is, between 3.5 and 4 million. But someone who’s better at trawling through Census data can no doubt do better.

Here’s my calculation: we start with the Census-measured decline in uninsurance among non-Hispanic whites, which was 6 million between 2013 and 2015. Essentially all of those gains will be lost if Price gets his way.

How many of those white insurance-losers voted for Trump? Whites in general gave him 57 percent of their votes. Whites without a college degree — much more likely to have been uninsured pre-Obama — gave him 66 percent. Apportioning the insurance-losers using these numbers gives us 3.42 million if we use the overall vote share, or 3.96 million if we use the non-college vote share.

There are various ways this calculation could be off, in either direction. Also, maybe we should add a million Latinos who, if we believe the exit polls, also voted to lose coverage. But it’s likely to be in the ballpark. And it’s pretty awesome.

Just give dad some robitussin and a Make America Great Again hat, you stupid, stupid people. I mean I feel horrible, but they voted for it. Not just for Trump. All of Appalachia is red, red, red and they’ve been voting this way for a while. There are no Democrats save Joe Manchin left to blame.

And they are still coming for you social security, you stupid bastards.

disabilitymap

1. West Virginia
> Pct. of working age population with benefits: 9.0%
> Pct. with recurring neck and back pain: 39.0% (the highest)
> 2011 labor force participation rate: 54.1% (the lowest)
> 2011 unemployment rate: 7.8% (23rd lowest)

No state had a higher percentage of working age people receiving SSDI benefits than West Virginia. In addition, the benefits received from by the federal government were more generous compared to most states. The average monthly benefit of more than $1,140 in 2011 was the 10th highest of all states. Almost 21% of recipients received monthly benefits of at least $1,600, a higher percentage than all but three states. Like most states on this list, West Virginia is among the less-educated states in the country. Just 18.5% of the adult population had a bachelor’s degree, the lowest percentage of all states. Also, few residents in the state had jobs. Just 54.1% of residents were considered part of the labor force in 2011, by far the lowest percentage of any state in the nation.

And those who aren’t on disability are just plain elderly and receiving social security benefits:

elderly

On top of all of this, some lady had some idea about revitalizing the region:

Hillary Clinton is committed to meeting the climate change challenge as President and making the United States a clean energy superpower. At the same time, she will not allow coal communities to be left behind—or left out of our economic future. That’s why Clinton announced a $30 billion plan to ensure that coal miners and their families get the benefits they’ve earned and respect they deserve, to invest in economic diversification and job creation, and to make coal communities an engine of US economic growth in the 21st century as they have been for generations.

She also had some thoughts about social security and medicare you can read about here:

Defend Social Security against Republican attacks. Republicans are using scare tactics about the future and effectiveness of Social Security to push through policies that would jeopardize it. The real threat is Republican attempts to undermine the bedrock of the system. Hillary believes that Social Security must remain what it has always been: a rock-solid benefit that seniors can always count on—not subject to the budget whims of Congress or to the fluctuations of the stock market. She fought Republican efforts to undermine Social Security when she was a senator and throughout her career, and she will fight them as president.

As president, Hillary will:

Fight Republican attempts to repeal the Affordable Care Act. The Affordable Care Act made preventive care available and affordable for an estimated 39 million people with Medicare and saved more than 9 million people with Medicare thousands of dollars in prescription drug expenses. Read more here.

Fight back against Republican plans to privatize or “phase out” Medicare as we know it. Republicans have called for privatizing or even “phasing out” Medicare and shifting millions more seniors into private plans that would dramatically raise costs. Hillary will stand against these attempts to weaken the program. Read more here.

You stupid, stupid, stupid people. And there honestly is no real way to stop this. You’ve given them majority rule over EVERYTHING. All Democrats can do is scream. I don’t know if there is even any real point to calling Manchin. He won’t get in the way of any nominees https://www.washingtonpost.com/blogs/plum-line/wp/2016/11/29/obamacare-is-probably-toast-and-a-lot-of-poor-white-trump-voters-will-get-hurt/?utm_term=.cba0274e91fe. Hell, he’ll probably vote to confirm Sessions and Price, then they will gut medicare, and the WV voters in their infinite wisdom will vote for his Republican opponent in 2018 because they will punish incumbents because they are angry and we’ll have a completely red delegation who will just give them more of the same. It’s sad and hysterical at the same time.

You can lead a horse to water but you can’t keep them from pissing in it and then drowning themselves in the urine.



Distributional Impacts of Price Plan (Reprise)

Now that we know Rep. Tom Price (R-GA) will be the next Secretary of Health and Human Services, it would be a good idea to look at the mechanics of his Obamacare Repeal and Replace bill. We did this in 2015 for HR2300 and I am reprinting the post on distributional impacts below. The mechanics of the plan are described in this post:

TLDR: The plan is good if you are healthy and wealthy as there are a ton of tax breaks and tax shelter expansions through HSA expansions. If you are chronically ill or poor, you are significantly worse off. And now for the moldy oldie:
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Where There’s a Will, There’s a Way to Screw the American People

monopoly1

Donald Trump, the GOP, and his wealthy backers had a real problem. On December 1st, an Obama administration rule that would expand by multiple millions of people the number of those who were eligible to receive overtime pay up to those who earn $47,500 a year was set to start:

In 2014, President Obama directed the Secretary of Labor to update the overtime regulations to reflect the original intent of the Fair Labor Standards Act, and to simplify and modernize the rules so they’re easier for workers and businesses to understand and apply. The department has issued a final rule that will put more money in the pockets of middle class workers – or give them more free time.

The final rule will:

– Raise the salary threshold indicating eligibility from $455/week to $913 ($47,476 per year), ensuring protections to 4.2 million workers.

– Automatically update the salary threshold every three years, based on wage growth over time, increasing predictability.

– Strengthen overtime protections for salaried workers already entitled to overtime.

– Provide greater clarity for workers and employers.

The final rule will become effective on December 1, 2016, giving employers more than six months to prepare. The final rule does not make any changes to the duties test for executive, administrative and professional employees.

The Republicans did not want this to go into effect, because if it did, they would find it difficult to repeal on 20 January, because even the American people are not dumb enough to notice their overtime being cut just two months after they started to receive it.

Fortunately for the Republicans, this just happened:

A Texas judge blocked President Obama’s bid to expand overtime pay protections to millions of Americans on Tuesday, thwarting a key presidential priority just days before it was set to take effect.

The Labor Department rule would have doubled the salary level at which hourly workers must be paid extra for overtime pay, from $23,660 to $47,476. Siding with business groups including the U.S. Chamber of Commerce, Texas District Judge Amos L. Mazzant III halted it.

The rule, finalized in May, represented the first such change in more than a decade and was hailed at the time as the most consequential action the Obama administration could take for middle-class workers without congressional involvement.

And with that, a significant payraise to millions of voters, economically anxious and otherwise, was strangled in the crib, and no fingerprints were left behind. Come January 20, Trump, Paul Ryan, and the coterie of wealthy industrialists and banksters who run this nation will quietly rescind the rule change, and no one will even know it ever existed.

America, fuck yeah!



Why Healthcare reform is continually important

Just a pair of tweets as to why I am so passionate about continual healthcare reform and system improvement:

The good news:

The bad news:

We can do better. This is a failure of our political and cultural system and we need to do better.



Gimme Brains for Breakfast Baby

Jump

Holy shit, Senator Elizabeth Warren apparently murdered a bankster in the Senate today:

I’m honest to goodness physically aroused.



APTC Hacks, Non subsidized plans and choice revelation

Advanced Premium Tax Credits (APTC) are only relevant for people who buy policies on the Exchanges.  However the subsidized universe is only about half of the entire individual market.  The non-subsidized and off-Exchange universes will help us determine how carriers embark on their Silver pricing strategies.

If an individual would have qualified for an APTC but buys an off-Exchange policy for whatever reason, they do not get any subsidy to help offset the premium.  They pay full price.  There are some non-subsidized buyers on the Exchanges.  A common case will be people with variable incomes who are not sure if they are subsidy eligible.  They may overestimate their income so they don’t have to pay the APTC back but if they have a bad year, they can collect the Premium Tax Credit the following year when they file for their tax refund.  People who know that they can not qualify for the Exchange have no reason to shop on Exchange.  Indeed, they have a mild incentive to look off-Exchange.

Policies that are sold on Exchange must be offered off-Exchange.  However carriers can offer policy and plan designs off-Exchange that they do not offer on Exchange.  Mayhew Insurance did that in 2014 with an experimental product as we needed data to see if our hunch was right (we weren’t).  Carriers can decide to only participate off-Exchange if they wish to do so.  The advantage of selling off-Exchange is that the population is a bit higher income and that tends to correlate with two things; better health and more stability in paying bills.  Even though policies are offered off Exchange, the on and off-Exchange policies in a single metal band in a state are in a common risk pool for risk adjustment purposes.

Off Exchange has a typical policy buying decision maker earning over 400% Federal Poverty Level (FPL).  On Exchange, subsidized buyers have a median policy decision maker earning around 200% FPL.  These are very different market segments.  And those differences can feed some insight into why a carrier that has the ability to capture the #1 and #2 Silver positions would engage in either a Silver Spamming or Silver Gapping strategy.

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