Tag Archives: Congressional Budget Office

Employers Urge Repeal of Small Group Expansion

The Affordable Care Act’s mandated expansion of the definition of the small group market would limit employers’ health plan options, according to employer groups who are urging the repeal of the mandate before it takes effect in 2016.

Expanding the small group market to include groups up to 100 would not only reduce choice for this segment of the market, it means some employers would be unable to keep the insurer they currently have, according to the Society for Human Resource Management and the National Association of Health Underwriters. The industry groups and more than a dozen other employer organizations are applauding efforts to repeal the ACA mandate through legislation called the Protecting Affordable Coverage for Employees Act (PACE).

The expansion is intended to make insurance more affordable for the smallest employers by expanding the risk pool to include larger companies. It also aims to increase the number of participants in the ACA’s Small Business Health Options Program, also known as the SHOP exchanges.

The PACE bill would maintain the current definition of a small group market as 1-50 employees and give states the flexibility to expand the group size if they feel the market conditions in their state necessitate the change.

“It is in the best interest of employers and their employees that states determine the definition of their small group market,” the groups argue in a recent letter to the bill’s sponsors, Senators Tim Scott (R-SC), Jeanne Shaheen (D-NH), and Michael Bennet (D-CO).

“Repealing the ACA-mandated expansion and returning to the historical role of state determination would allow flexibility and ensure a broad array of coverage options and mitigate dramatic premium increases,” they add.

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

Republicans Proposed Plan to Replace The ACA

The Washington Times reports that the list of Republican plans “to deal with the potential fallout” from King v. Burwell “is growing longer, although Republicans have yet to coalesce around a game plan with just six weeks before the court is expected to rule.” Rep. Tom Price (R-GA) unveiled a “revamped version” of his ACA replacement bill last week. The proposal would repeal the health law in its entirety and offer tax credits to people to purchase insurance on their own. Another plan, from Sen. Bill Cassidy (R-LA), would allow states three ways to respond to a Supreme Court ruling against the ACA’s subsidies: “States could set up exchanges under Obamacare, do nothing and lose federal support or – and this is what the senator wants – opt into a third path titled the Patient Freedom Act.”

The Hill reported in a similar article that Republican lawmakers “are all over the map about what to do about the millions of people who could lose” subsidies if the Supreme Court rules against the ACA next month. Although Republicans agree that “they need a plan if the high court strikes down a subsidies next month,” they do “not agree about how to help people who’d lose access to healthcare – and even whether to help them at all.” Currently, “there are more than half a dozen plans floating around, with varying degrees of details.”

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

IRS Fact Sheet: Determining Large Employer Status

Fact Sheet Includes Examples and Additional Resources

A fact sheet from the IRS helps employers determine, based on their size, whether the ACA’s employer shared responsibility (“pay or play”) and information reporting provisions apply to their company.

The fact sheet includes basic information on determining large employer status, along with information on:

  • Determining the number of full-time and full-time equivalent employees
  • Large employer determination examples
  • Employer aggregation rules
  • The exception for seasonal workers
  • New employers
  • 2015 transition relief for determining workforce size

More information about determining large employer status can be found here.

Visit our Pay or Play section for additional details.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

On Demand Doctor Apps are Here

New smartphone apps can deliver doctors to your doorstep.

Heal is a smartphone app similar to the on-demand car service Uber, but instead of a car, a doctor shows up at your door. Users download the app and then type in a few details such as address and the reason for the visit. After adding a credit card and a request for a family doctor or a pediatrician, the physician arrives in 20 to 60 minutes for a flat fee of $99. Heal began in Los Angeles in February, recently expanded to San Francisco and is set to roll out in another 15 major cities this year. Heal doctors are on call from 8 a.m. to 8 p.m., seven days a week, said Dr. Renee Dua, a founder and the chief medical officer of Heal.

Heal doctors arrive with a medical assistant and a kit stocked with the latest high-tech health gadgets, including tools needed to take your vitals or shoot high-definition video of your eardrum. Heal has a roster of doctors who have affiliations with respected hospitals and programs such as the University of California, Los Angeles; Columbia; and Stanford.

“We’re bringing back old-school techniques with new-school technology,” Dr. Dua said.

Obviously, Heal doctors can offer only limited services on a house call. Among other things, they can diagnose and treat moderate ailments like bronchitis, give flu shots, stitch up a nasty cut or write a prescription (they will even pick the prescription up for an extra $19). But you will have to file the insurance paperwork.

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

Most Doctors Don’t Follow Guidelines for Patients

For all their talk about evidence-based medicine, a lot of doctors don’t follow the clinical guidelines set by leading medical groups.

Consider, for example, the case of cataract surgery. It’s a fairly straightforward medical procedure: Doctors replace an eye’s cloudy lens with a clear, prosthetic one. More than a million people each year in the U.S. have the surgery — most of them older than 65.

“The procedure itself is relatively painless and quick,” says Dr. Catherine Chen, an anesthesiologist and researcher at the University of California, San Francisco. She calls it the “prototypical low-risk surgery.”

And since at least 2002, Chen says, clinical guidelines have stipulated that no preoperative testing is needed before cataract surgery. A large study showed that procedures like chest X-rays, blood tests and EKGs — tests sometimes recommended when older people undergo more complicated surgeries — do not benefit someone who is simply having a cataract removed.

But Chen noticed that a lot of patients are having these preoperative tests done anyway. How many? Digging into the numbers, she discovered that half the ophthalmologists who performed cataract surgery on Medicare patients in 2011 ordered unnecessary tests. That’s the same percentage as in 1995.

“In about 20 years, nothing has really changed in terms of physician performance,” Chen says. She recently published those findings in the New England Journal of Medicine.

Dr. Steven Brown, a professor of family medicine at the University of Arizona, has studied doctors’ reasons for ordering unnecessary tests before a scheduled surgery. A lot of it has to do with perceived safety, he says.

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

Shopping Limited Networks to Save Money

In all the turmoil in health care, one surprising truth is emerging: Consumers seem increasingly comfortable trading a greater choice of hospitals or doctors for a health plan that costs significantly less money.

“Are they willing to trade choice and access for price? There’s no question about that,” said Mark Newton, the chief executive of Swedish Covenant Hospital, a Chicago hospital that recently teamed with an Illinois insurer, Land of Lincoln Health, to offer a health plan.

This year, nearly half of the plans offered on public health care exchanges are so-called narrow network options, which sharply limit the medical providers whose services will be covered, new data shows. Furthermore, nearly a fifth are considered “ultranarrow networks,” which offer even fewer choices. At the same time, more employers are also embracing the plans for their workers, largely as a way to lower health care costs.

The data, gathered by the McKinsey Center for U.S. Health System Reform, is significant, given early criticism from some providers and patients who reacted to these plans last year by arguing they were like the overly restrictive health maintenance organizations, or H.M.O.s, of the 1990s, which were ultimately rejected by consumers.

The financial strategy is relatively simple. Insurers say one way to lower the price of a plan is to limit the number of hospitals and doctors in their networks. They can then ask providers to discount their prices in return for a potentially higher volume of patients; some also say they are trying to pick a select group that provides better care.

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

Estimated Cost of Affordable Care Act Reduced

The Congressional Budget Office on Monday again lowered its estimate of the cost of the Affordable Care Act, citing slow growth of health insurance premiums as a major factor.

Just since January, the budget office said, it has reduced its estimate of the 10-year cost of federal insurance subsidies by 20 percent, and its estimate of new Medicaid costs attributable to the law has come down by 8 percent.

Slower growth in health spending helps consumers and businesses, which shoulder most of the costs, and contributes to lower federal budget deficits.

The budget office now projects deficits totaling $7.2 trillion from 2016 to 2025, a decrease of 6 percent from the more than $7.6 trillion projected in January.

“The largest factor underlying that reduction is a downward revision in projected growth in premiums for private health insurance,” reflecting the fact that spending by private insurers in 2013 rose less than in preceding years and much less than expected, the budget office said in a new report.

The new estimates could help Democrats stave off Republican efforts to roll back the law. Even though millions of people have gained coverage, opinion polls show that unfavorable views of the law are still more common than favorable ones.

Josh Earnest, the White House press secretary, said the new estimates were “the latest in a long line of data points that indicate the Affordable Care Act is contributing in a very positive way to holding down the growth of health care costs.”

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

Loopholes in Insurance Barring Mental Health Patients

A flood of patients who have become newly insured under the Affordable Care Act are visiting doctor’s offices and hospitals, causing some health workers to worry about how they can provide care to everyone in need. One group, however, isn’t lining up for care: People with mental health issues or substance use disorders.

Though Obamacare extends coverage to this group – collectively referred to as behavioral health – various loopholes in the health care law at this time have kept people from requesting mental health care. Some states haven’t expanded Medicaid, the government health insurance program for poor or disabled Americans, leaving about 5 million in a coverage gap, the majority of whom, experts believe, need mental health care. In other cases, patients aren’t even aware of the benefits they can get with their new health insurance.

The Congressional Budget Office projected that 13 million uninsured Americans would have access to health coverage by 2014, whether through Medicaid, online exchanges or the private market. But so far the demand for mental health services hasn’t budged, even though provisions in the health law make it more affordable.

More patients seeking mental health care will come within the next few years, experts project, and the question then will be whether there will be enough providers available. Paul Gionfriddo, CEO of Mental Health America, predicts a ” bump in the road where access gets a little more constrained,” though he is optimistic that the details of the law will work the way they are supposed to in time.

“We haven’t been hearing about access issues from our members,” says Stuart Gordon, director of policy and health care reform at the National Association of State Mental Health Program Directors.

That isn’t for lack of need. Mental health is one of the most common health care issues, affecting as many as 1 in 4 adults each year.

The federal Substance Abuse and Mental Health Services Administration found in a 2013 report that 9.6 million adults reported having a serious mental illness, such as major depression, schizophrenia, bipolar disorder, obsessive compulsive disorder, panic disorder, post traumatic stress disorder and borderline personality disorder.

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

Obamacare and The Individual Mandate Tax Dilemma

There are dozens of ways to escape Obamacare’s individual mandate tax — but good luck figuring that out come tax season.

Tens of millions of Americans can avoid the fee if they qualify for exemptions like hardship or living in poverty, but the convoluted process has some experts worried individuals will be tripped up by lost paperwork, the need to verify information with multiple sources and long delays that extend beyond tax season.

“It’s not going to be pretty,” said George Brandes, vice president of health care programs at Jackson Hewitt, a tax prep firm. “Just because you theoretically qualify for hardship, or another exemption, doesn’t mean you’re going to get it.”

The worries may foreshadow a messy tax season next year as the one in 10 Americans who remain uninsured calculate their tax bill for the first time under Obamacare’s individual mandate.
Those without health insurance will have to cough up $95 per person or 1 percent of their income, whichever is greater. That penalty eventually jumps to $695 or 2.5 percent.

The White House expanded the list of exemptions allowing the uninsured to bypass the penalty for legitimate reasons, including religious restrictions, falling on rocky times or a death in the family. Another big out created after the controversy over canceled health plans was the so-called affordability exemption that allows people to opt out if premiums are still not affordable.

The Congressional Budget Office expects 23 million of the 30 million Americans who remain uninsured in 2016 to qualify for exemptions. It’s part of the reason the CBO in June downgraded from 6 million to 4 million the number of people it estimates will pay the penalty.
The uninsured have two ways to opt out: The easiest way is fill out a new tax form for those exemptions that don’t require Obamacare marketplace approval. Some will be simple, including the exemption for being uninsured for under three months or those living below a certain income — about $10,150 for singles and $20,300 for married couples.

To read more, click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary

 

Big News Regarding Medicare

You’re looking at the biggest story involving the federal budget and a crucial one for the future of the American economy. Every year for the last six years in a row, the Congressional Budget Office has reduced its estimate for how much the federal government will need to spend on Medicare in coming years. The latest reduction came in a report from the budget office on Wednesday morning.

The changes are big. The difference between the current estimate for Medicare’s 2019 budget and the estimate for the 2019 budget four years ago is about $95 billion. That sum is greater than the government is expected to spend that year on unemployment insurance, welfare and Amtrak — combined. It’s equal to about one-fifth of the expected Pentagon budget in 2019. Widely discussed policy changes, like raising the estate tax, would generate just a tiny fraction of the budget savings relative to the recent changes in Medicare’s spending estimates.

In more concrete terms, the reduced estimates mean that the federal government’s long-term budget deficit is considerably less severe than commonly thought just a few years ago. The country still faces a projected deficit in future decades, thanks mostly to the retirement of the baby boomers and the high cost of medical care, but it is not likely to require the level of fiscal pain that many assumed several years ago.

The reduced estimates are also an indication of what’s happening in the overall health care system. Even as more people are getting access to health insurance, the costs of caring for individual patients is growing at a super-slow rate. That means that health care, which has eaten into salary gains for years and driven up debt and bankruptcies, may be starting to stabilize as a share of national spending.

The chart above highlights the changes. It compares Medicare spending estimates from the Congressional Budget Office since 2006. Every year, the C.B.O. puts out its best guess for what the country will spend on Medicare over the next 10 years. In 2019, the C.B.O. now estimates the United States will spend about $11,300 in 2014 dollars to care for each person in Medicare. That’s down from around $12,700 since 2010, the year the Affordable Care Act became law. Now multiply that number times the 62.5 million people who will be in the Medicare program.

To read more,  click here.

Jeffrey R. Ungvary President

Jeffrey R. Ungvary