Listen in: My comments to NPR on the first days of the exchange roll-out

Warren Olney hosts me among a panel of exchange and health care reform experts to give insight on week 1 of the ACA exchange roll-out

This morning I had the chance to speak with Warren Olney and a group of other exchange and health reform experts on the first days of the ACA exchange roll-out.

Listen to or download the podcast of “While the Clock Ticks, Software Defects Mar Healthcare Roll-Out” on To The Point with Warren Olney.

I joined a panel of experts on when the ACA will be ready for prime time. To The Point tweeted key comments from each of us, including:

• Bryce Williams, Towers Watson: Hard to penalize Americans for not buying what they can’t easily buy online says @brycewatch
• Juliet Eilperin, Washington Post White House correspondent: WH has stopped giving reporters like @eilperin hard #s about Obamacare web hits
• Jyoti Bansal, AppDynamics: Healthcare.gov  glitches partly due to “old legacy systems” from state websites says @appdynamics
• Peter Suderman, Reason magazine: Whopping 7% polled say Obamacare roll-out has gone “quite well” says @petersuderman
• Tayse Haynes, Cabinet for Health and Family Services of Kentucky: One surprising state where Obamacare’s been less rocky: Kentucky. We hear from the health czar.

In the full podcast, you’ll hear comments on these points and more:

• What factors states had to consider in setting up their exchanges
• What could happen with those who get their coverage later due to state exchange glitches
• How options for young people’s coverage could impact state exchanges
• How this launch compares to the roll-out of Medicare Advantage and Part D nearly a decade ago

The Rubber Meets the Road

Exchanges are the new vehicle for health care reform changes coming down the road, and the on-ramp is coming right up

With elections and this past summer’s SCOTUS decision behind us, the major events that could have altered the macro course of the Patient Protection and Affordable Care Act (PPACA or ACA) are behind us.

The health care providers, insurers and those closely tied to getting health care benefits into the hands of consumers – particularly employers – now face a series of milestones, not all clearly defined, through  Jan 1, 2014 – when 30 million previously uninsured Americans could begin new health care coverage – and beyond.

Just how these different interests– consumers, insurers, providers and the law – converge is where the rubber meets the road.

Circle these dates on your calendar

• Dec 14, 2012 – States can declare whether they will run their own state health care exchange, let the Feds run it for them or partner with the Feds.
• 2013 –Medicare payroll tax increases for higher-wage employees. Employee pre-tax contributions to health flexible spending accounts get capped at $2,500.
• Feb 15, 2013 – States must declare if they would prefer to partner with the Feds
• March 1, 2013 – Employers must notify employees of exchange-based coverage options
• Fall 2013 – State and private health benefit exchanges will be operational for people to begin signing up for new Jan 1, 2014 health plan start-dates.
• 2014 – The mother lode of rules comes online: individual mandate, play-or-pay mandate, premium and cost-sharing subsidies, Medicaid eligibility expanded in some states and additional group health plan mandates.
• 2016 – Sales of health insurance across state borders permitted if neighboring states agree.
• 2017 – States can choose to open exchanges to large employers.
• 2018 – Cadillac tax kicks in.

Pieces of the regulatory puzzle that have to be filled in

• Just out today – Proposed rules on essential health benefits, guaranteed issue and employment-based wellness programs were published by Health and Human Services.
• Full-time vs. part-time – More specifics distinguishing full-timers and part-timers will be clarified for the purpose of applying penalties for not offering health benefits.
• Premium tax credit – How this will be calculated by the IRS.

Stay tuned for a shift in focus in these areas

• Fix-it – Look for a PPACA-fix bill to be proposed in early 2013. There are some provisions that will need to be adjusted, where costs or incentives don’t necessarily promote the best behaviors.
  • Look for adjustments in how health savings accounts and health reimbursement accounts are capped and taxed.
  • Expect health insurers to be more vocal on the Feds minimizing the health care premium tax and on states taking up ACA’s Medicaid expansion.
  • At issue in the Senate will be the Independent Payment Advisory Board (IPAB) and the medical device tax among other negotiations.
• Providers take on new gravitas in the cost arena – Accountable care organizations will be going full-steam ahead. Over 80% of the ACOs created to date have been created by hospital and doctor groups, which could signal a shift in control away from the health insurance carriers to providers. The jury is still out on whether ACOs will lower total health care costs, but hospitals are certainly now incented to hold down preventable readmissions and hospital acquired conditions.
• Entitlement reform – Medicare will continue to evolve according to the plan laid out in the ACA and will be a big part of talks during grand bargain negotiations in 2013. With both sides of the political spectrum far apart on reform, this will be interesting.

Stay tuned for a shift in focus in these areas

As these timeline, rule and structural developments start coming online, there will be a lot to keep track of and many calculations to make. I pay close attention to these and will write on new trends in the health care and insurance space as they break.

Read more

• Obama administration moves forward to implement health care law, ban discrimination against people with pre-existing conditions
• Maine May Warm To ‘Obamacare’ After Democratic Sweep
• Post-election flood of ‘Obamacare’ rules expected
• Health Insurers Are Shifting Focus to Costs, Ignagni Says
• Boehner Suggests GOP Will Target Specific Pieces of Health Care Law
• Improvements sought for health insurance law

For regular commentary on developments and trends in health care, technology and insurance, follow @brycewatch and @ExtendHealth on Twitter and check out www.extendhealth.com.

ACA Survives: Supreme Court Rules Individual Mandate Constitutional

At 10:07 a.m., Thursday 6/28, the Supreme Court of the United States issued its ruling on the constitutionality of the individual mandate, and ended (for now) the challenge to the Affordable Care Act.

With Chief Justice Roberts siding with the majority, the Supreme Court decided in a 5-4 vote to uphold the individual mandate as a tax. The case before the court on Medicaid expansion was upheld narrowly, with the Court ruling that the federal government may not cut off all of the Medicaid funding of states that opt out of Medicaid expansion – but the expansion can continue.

For the actual text Supreme Court ruling, go to the Supreme Court of the United States website. To see a replay of a live blog of the orders and opinions of the court, go to the SCOTUS LiveBlog.

I will be linking to thought provoking commentary on and reactions to the decision from my Twitter account @brycewatch.

Stay Tuned for SCOTUS Decision on ACA

No healthcare decision from SCOTUS today. It could be any day from Tuesday to Thursday this week.

SCOTUSblog expects the healthcare opinion Thursday. I will be checking each morning to be sure. Stay tuned here and @brycewatch on Twitter. Thanks for following.

“The Broccoli Test” for the individual mandate

Harvard law professor Einer Elhauge put up this OpEd yesterday in the New York Times outlining an interesting argument for the constitutionality of the ACA’s individual mandate clause. Here’s a snip:

But the argument that the commerce clause does not authorize the insurance mandate is beside the point. The mandate is clearly authorized by the “necessary and proper clause,” which the Supreme Court has held gives Congress the power to pass any law that is “rationally related” to the execution of some constitutional power.

I’ve argued before that the law can work without the individual mandate, given the right conditions including annual enrollment periods, affordable, standardized plans and guaranteed issue among others. I’m looking forward to hearing the arguments on both sides as the Supreme Court date gets closer.

Will Americans Buy Health Insurance Without A Mandate?

Earlier this year, I wrote an article for InsuranceNewsNet offering my opinion that the individual mandate provision of the Patient Protection and Affordable Care Act (PPACA) is not essential to achieving the law’s goal of ensuring that tens of millions more Americans have health care coverage.  The individual mandate provision requires all citizens to obtain health insurance by 2014 or pay a fine.

In the past 30 days, court rulings on both sides of the question of whether the individual mandate provision is constitutional makes it even more likely that the U.S. Supreme Court will review the matter sooner rather than later.

The unconstitutionally of the individual mandate has become the central argument of opponents in legal challenges to the entire law. They argue that if such a key provision is ruled unconstitutional, the entire law should be unconstitutional. It also remains unpopular with average Americans. In a new poll out last week from the Associated Press and National Constitution Center, 82% of respondents said “no” when asked, “Do you think the Federal Government should have the power to require all Americans to buy health insurance, and to pay a fine if they don’t?”

We’ll have to wait and see how the U.S. Supreme Court rules to know the fate of the provision. But my own opinion hasn’t changed. Based on our experience at Extend Health, if a health insurer offers seniors a private Medicare plan that meets their needs at a price they can afford, they will buy. This is because certain conditions for Medicare-eligible seniors exist that do not exist for all Americans. Most important, Medicare is guaranteed issue and requires standard plan designs.

Guaranteed issue means seniors cannot be denied coverage because of their health status. Standard plan design makes it possible to compare and contrast different plans from different carriers more easily. And these are exactly the conditions all uninsured Americans will experience under PPACA starting in 2014.

While I still believe that these conditions are necessary for large numbers of uninsured Americans to buy health plans without a mandate, today I would also argue they are not sufficient. In addition, the key stakeholders driving the extension of health care coverage to more Americans will need effective outreach programs to ensure that all Americans know their options, understand their eligibility for the federal subsidies that will be offered, and know where and how to purchase health plans.

A large group of these stakeholders – health insurers, health care providers, associations and health care nonprofits – took a major step in the right direction last week when they launched a nonprofit coalition with the mission of ensuring that “all Americans are enrolled in and retain health coverage.” Enroll America  will do this by working to ensure that enrollment processes are simple and streamlined and that people know where they can go to find the right information at the right time.

It’s too early to tell whether Enroll America will be successful. But the importance of its mission cannot be underestimated. While the ACA lays the foundation for insuring tens of millions more Americans with guaranteed issue and standard plan design, finishing the job will require that every American understand what’s coming, and what they can do and when.

Visit Extend Health — the nation’s largest private Medicare exchange.

An Individual Mandate Doesn’t Matter

Image via Wikipedia

A prime example of the need for citizens to understand what’s in the health care reform bill is the controversy over the individual mandate.  A majority of those polled say they approve of many or all of the bill’s provisions –except for the mandate.

But I don’t think the mandate is critical to the success of PPACA. There are other ways to incentivize people to buy health insurance, and our experience running a large exchange is informative on this issue too.

Why do so many people buy Medicare supplemental insurance? Two key reasons: guaranteed issue and standardized plan designs. With guaranteed issue, they know they can’t be turned down, and standardized plans offered on an exchange make it easy to compare benefits and find plans that fit their needs.

If you add an annual enrollment period (AEP) to PPACA — which already includes guaranteed issue, standardized plans, and exchanges — you’ll have something that looks a lot like Medicare. People will enroll during the AEP because they won’t want to risk getting sick without coverage – no mandate necessary.

Informed citizens who understand what’s in PPACA can debate my argument and lobby their representatives for or against provisions of the bill – in short they can help shape the future of reform, and make sure it does what it was meant to do: provide health insurance for more citizens of the United States.

Visit Extend Health — the nation’s largest private Medicare exchange.