Good news everybody

Just some more good news:

and the good news will probably continue for the first quarter of 2016:

So in 3 years, all of the data sources suggest that we’ve cut the uninsured rate in half and slowed the cost curve. There are another couple percentage points of easy gains once the rest of the Confederacy and the everyone between the Mississippi’s left bank and the Columbia’s south bank expand Medicaid.

Then we’ll actually need to take another whack to get the last 5% of the population covered AND get better coverage for 25% to 30% of the currently covered population.



Good news everybody

The CDC  has released their initial 2015 uninsured population counts.  Good news, for all residents of the US in the US through September 2015.  Remember, this percentage will go down a bit more as Montana and Alaska are expanding Medicaid and the 2016 Open Enrollment period pulled in more people.

 

CDC 2015 uninsured rate

These numbers are a bit lower than Gallup and other sources because this data set includes kids and the elderly.  Both of those groups tend to have a higher insurance rate because there are more government programs aimed at those two populations.  Working age adults have a slightly higher than national average uninsured rate.



Public option and provider reimbursement nudges

On Twitter, there is a long and productive discussion about provider pricing and the recent study on commercial payer rate variations.  Part of the discussion went back to this Washington Post article on price suppression from October 2010.

 

The administration decided not to seek lower drug rates for Medicare, and it didn’t press for a “public option,” a government-run insurance plan that people under 65 could buy into. While supporters of the public option sold it as a way to compete with insurers, the real target was hospitals and doctors. A public option would have created a nationwide purchaser of health care that could have exerted leverage on providers to cut prices. This would have lowered the law’s costs by reducing the subsidies needed to make insurance affordable….

“The public hates the insurance industry and trusts doctors and hospitals,” said Richard Kirsch, head of the liberal coalition Health Care for America Now. “But what killed the public option was the hospitals, not the insurance industry.”

The public option would have been a marginal pressure to reduce prices.  There were several flavors on how providers would be paid in a  public option.  The two most common were Medicare plus X where X was some percentage between 5% and 15%, and negotiated rates.

Under Medicare plus 5% or Medicare plus 15%, the public option would be a non-differentiated product in competitive insurance markets and a narrow network product in non-competitive markets. Mayhew Insurance is in a competitive market region for the Exchanges.  The lowest priced Silver plans offered by all of the insurers in this region are narrow network HMOs where the providers get paid Medicare rates plus 5% to Medicare plus 10%.  The public option would be just another plan that is in the cluster for the 2nd Silver subsidy point.  If the network is a broad network like the rest of Medicare, the public option would probably be overpriced compared to similar products because the public option network would include a lot more high cost providers than the targeted narrow networks.

In noncompetitive payer and provider markets, the public option at Medicare plus 5% or Medicare plus 15% would be a fairly narrow network.  Medicare can get away with offering fairly low rates in non-competitive markets and still have most hospitals and providers sign up for traditional Medicare because Medicare can promise volume.  The Exchanges can’t promise volume.  The Exchanges for this year are projected to insure 4% of the US population, and it is a fairly low utilizing population when compared to Medicare.  That means providers don’t need the Exchange volume to cover their fixed costs.  Under a Medicare plus X regime, quite a few providers would not sign the contract.  They would not want to set a precedent of taking Medicare based rates.  So the public option in provider dominated markets would keep the dominant insurer honest but the pricing differential after a year or two would not be tremendous.

If the public option was a negotiated rate product, it would be similar to the 2nd Silver chasing products in competetive markets.  In minimally competitive insurance markets, it would probably have a broader network than it would under a Medicare plus X scheme but the pricing difference between it and the lowest priced Silver from the dominant carrier would be smaller.

I think the public option is something that should always be presented by progressives as a budget pay-for as it will produce significant savings to the federal government through lower subsidy levels but it is not a panacea.  The Exchanges are not big enough pools of patients and dollars to drive hospitals and other providers to completely change their pricing models.



Good news everybody

What an amazing failure — goals are being met, costs are being contained, and the expenditure curve is still looking better today than it did seven years ago.

Can we have more amazing failures like this

:)



Late Night Open Thread: Jeez, JEB!

My wrist isn’t up to typing a full catalog, but candidate JEB! had a lousy August and it’s looking like September isn’t gonna be much happier for him.

He’s looking more and more like he only got into this poker game because “the family” couldn’t bear to have Dubya as their most enduring representative, and now he’s down to his boxers and socks and fearful of having to limp home in the morning with Trump’s NO CLASS LOSER Sharpie’d on his hairy back.



The ACA and throwing money at a problem

Andrew Sprung, guest-posting at the Incidental Economist, has reviewed an interesting little e-book that is on my to read list:

ObamaCare is a Great Mess: A View of the Affordable Care Act Without Partisan Blinders & How to Fix It. By Jed Graham. Amazon, June 2015

Mr. Graham writes that there are a couple major problems with the ACA going forward.  The first is that the subsidies are not rich enough to be attractive to people who make more than 200% FPL.  Secondly, the subsidies are only sufficient to cover Bronze plans with big deductibles instead of cost-sharing Silver plans with low deductibles but 15% higher premiums.  Thirdly, the subsidies end too soon.  While finally the plans are too costly for young people which is leading to a sicker and older risk pool than projected.

Andrew has done a good job of dismantling the second point as he has been pointing out that the vast majority of people who are eligible for cost-sharing Silver plans are buying those plans as the deductibles are far more reasonable than slightly cheaper Bronze plans.

However, the other problems have a very simple solution.  Shovelling money at them.  The subsidy formula could theoretically be tweaked so that slope upwards of the personal contribution at a given income level is far less, the base line plans could be reset so a Silver is 75% actuarially value where the additional actuarial value is paid for by subsidy dollars instead of individual dollars.  The subsidy formula could be easily tweaked so that no family pays more than X% of their income for a QHP without regard to the income level so there is no income cliff/work disincentive at 399.99% FPL.

All of those are fairly simple tweaks that are not disruptive to the fundamental delivery of health care and health insurance to the greater population.  And these are all problems where throwing money at the problem is a valid and viable solution.

We did not get these policy tweaks in PPACA because the Democrats, and more importantly, the marginal decision makers in the Democratic caucs were petrified of writing a bill with a “bad” CBO score.  There was a line of thought that a “responsible” and “small” bill would help preserve a majority or at least more of the marginal district Democrats.  Going bigger would have produced a better bill ( and if the bill contained more cash going out the door in 2012/2013, a slightly better economy).

In reality, Democrats who represented significantly Republican leaning districts as the country became more polarized had to count on two things to stay in office.  The first was that any particular opponent was a kid-diddling goat fucker.  The second was a good economy with significant wage gains.  A good CBO score on a polarizing bill is about the ninety-ninth ranking aid to re-election.  A “responsible” bill pandered to elite consensus without actually getting any additional people to vote for “responsible” Democrats.

 



Senator Warren Breaks It Down for the Neanderthals

What she said:

We need the equivalent of Nancy Smash for her.