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This decision by the administration will further tilt our failed private healthcare system towards seeking to insure only healthy people while denying the sick who really need healthcare coverage. It will actually further incentivize them to exclude those in greatest need from plans or deny their claims.On Saturday, the U.S. Centers for Medicare & Medicaid Services said a months-old federal court ruling would force it to suspend what are known as risk-adjustment payments, worth about $10.4 billion for 2017. The payments are part of a program in the Affordable Care Act meant to help balance the insurance markets when some insurers inevitably got stuck with sicker, more costly patients.
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Having just turned 63 and previously retired, I'm bracing for a pretty big healthcare bill next year.
Mighty un-Christian of you bartab.
Sorry, maybe I'm confusing you with another rightist poster here.
But if not, then wtf, dude. Seriously. Is libtard trolling / epater pleasure worth shooting yourself in your own new organ, or whatever it was?
Apologies if I have subbed someone else for you.
There's more to the story, and to the potential effects, than the little fragment he quoted above. Many people, including the state insurance regulators in NY and MD, complained (during the Obama administration) that the risk adjustment formula used by CMS (applied to all 50 states) was hurting new and/or smaller insurers. Despite these warnings, CMS took only baby steps to correct.
Risk Adjustment Gone Wrong, Aug 7, 2016. This offers a clear summary of the ACA's "three Rs" and describes how risk adjustments have played "reverse Robin Hood" with insurers.
The judge in the federal ruling said the damaging aspects of the risk adjustment formula were okay. My quick take on the court's thinking is: well, CMS acted reasonably on complex information, so the harm doesn't matter. All that matters is the reasonable intent, not the unreasonable result of putting CO OPs and other startup insurers out of business.
The only thing the court objected to was that fact that CMS had not used permissible rationales for one part of the formula (using a state's average rates rather than rates specific to each insurer). The court even suggested that had CMS articulated a policy basis, the court could have upheld the risk adjustments. (See p. 68 of the ruling.) A technicality in the worst sense of the word, IMHO.
Court opinion and order.
Further, the ruling doesn't affect risk adjustments going forward. From the article Lewis cited: As to the 2018 payments, that's another matter. Here's speculation presented last Monday to AEI by "Timothy Jost, a Washington and Lee University professor emeritus who closely follows the ACA." https://www.fiercehealthcare.com/hospitals-health-systems/american-enterprise-institute-event-examines-future-aca
https://kff.org/health-reform/issue-brief/explaining-health-care-reform-risk-adjustment-reinsurance-and-risk-corridors/
As Madeleine Albright observes in her current book, if the rest of us just sit there and do or say nothing it can just be a matter of time until fascism silently wins the day. Wouldn't be the first time, by any means.
(Image from Washington Post article)
http://theweek.com/5things/784138/trump-administration-cuts-grants-that-help-consumers-aca-coverage#3item
I will say this: a few years ago, we inquired about getting on a plan through the "Connector" here in Massachusetts. One guy on the other end of the phone line actually was using some shit-bag "hard-sell" tactics. We did not fall for that bunch of feces. Another "agent" would not let me even SPEAK, and told me if I mentioned "X" (I've forgotten what it was) again, then she would hang up on me. UNPROFESSIONAL FART-BRAINED LOSERS working for those "exchanges." We continued to get contradictory mailings from them, too. And NOTHING should take 9 days through the mail to get to Springfield from Taunton. 80 miles, perhaps. (Surely, there are very simply some essential, key "civil servants" involved in this FUBAR operation who JUST DO NOT CARE.) My wife and I have stuck with the extremely value-less stinker insurance plan through her job. Because we need "insurance." Well, what we have is almost insurance. It's just fine with The Powers That Be, because actual, useful insurance COVERAGE is not the goal.
All that I quoted from an AEI presentation were statements that:
- holding off on 2018 risk adjustment payments is unnecessary and will harm ACA plans (increase premiums and cause insurers to drop out)
- if the 2018 payments are not ultimately paid on time, it would be because Trump would be trying to wreck things.
Is there something here you disagree with?KFF describes the intent of risk adjustments, and goes on to describe how it is supposed to work in concept. Nothing about how it has played out, how it may have worked to the detriment of the ACA: The original article you cited notes that "Some newer insurers have criticized the risk-adjustment program, saying it benefits more established insurers that have the resources to identify more of their customers’ ailments."
I've been aware of these complaints for two years. I believe that the magnitude of the dollars involved and impact on these insurers are real and represented accurately. What I've not been able to ascertain is whether and to what degree the payments from new/small insurers to large/established insurers are due to a flaw in how risk adjustments are calculated, and how much if any reflects poor operations/actuarial work/management of the newer insurers.
I urge you to take a look at my first citation above, Risk Adjustment Gone Wrong. I suggested this because I found it clear and comprehensive, covering, the background that is contained in your KFF quote, how risk adjustments have worked out, and possible explanations.
I did not link to it because it was an authoritative source or that I was familiar with the writer Jonathan Halvorson. I can't speak to his orientation, but upon looking him up, he certainly appears expert on the subject (i.e. not your typical blogger).
http://sachspolicy.com/about/jonathan-halvorson/
In your Risk Adjustment Gone Wrong blog, the author cites HealthRepublic's failure in New York as an example.But the reason HealthRepublic had to make risk-adjustment payments was its customers were mostly younger, healthier people getting insurance for the first time. Meanwhile, the larger insurers in the state have an older risk pool with a significant amount of less healthy customers. Well guess what, in that situation I do think the insurers handling the sicker patients are entitled to risk-adjustment payments just so long as they continue to care for such sick patients and not try to deny their claims or kick them out of their insurance plan--a problem existing in the pre-Obamacare era.
HealthRepublic intentionally under-priced its insurance to attract new customers--again the problem with being a new entrant--and was effectively cherrypicking younger healthier customers. The fact that it under-priced its risk in no way invalidates the concept of risk-adjusted payments. It shows that the idea of a competitive private market in health insurance is rather stupid as scale is really necessary to compete, but if there is supposed to be some sort of private market, at the least insurers should not be incentivized to cherry pick their customers and deny coverage to the sickest people, defeating the whole purpose of having health insurance in the first place.
Do you have a reference stating that HR's customers were healthier or that it was cherry picking? Low prices for bronze plans could be circumstantial evidence, but it's rebutted by the fact that HR's prices were low across the board, not just on plans targeting healthier people. In addition, unlike most of the plans it was competing against, HR offered a broad network including access to Memorial Sloan Kettering. An obvious draw for cancer patients.
The risk adjustment figures for HR certainly suggest that it had healthier customers. But since the question here is whether that formula misrepresented the health of customers, relying on the adjustment numbers for HR would constitute circular reasoning.
Health Republic was (aside from the size of its adjustments) a poor choice of an example for many reasons. From USCAnnenberg Center from Health Journalism:Insurance co-ops were supposed to foster choice and competition, but they never had a chance August 15, 2016.
It notes that "In Iowa and Nebraska ... co-op officials also [like Health Republic] lured customers with low premiums and other enticements. They hooked older people, a group likely to be sicker and generate lots of claims, with platinum policies offering generous coverage."
It goes on to observe that "the co-ops’ hands were also tied from the get-go. Likely competitors with a distaste for competition and old political opponents of the public option in Congress were taking no chances. They threw up roadblocks from the beginning." (You can read the article for details.)
Health Republic was mismanged both internally and by the NYS regulators, who denied HR's requests to raise rates even before it went live. I did acknowledge that some of the reasons for large payments from newer insurers to, e.g. the Blues, could be due such causes. HR is a particularly egregious example, which is why it wasn't a good one for the blog to cite.
http://acasignups.net/16/04/25/new-york-health-republic-meltdown-embarrassing-just-about-everyone
This may be a better example - a new insurer, with healthcare pedigree and deep pockets (both unlike co-op's) that was on the hook for $100M risk adjustment payments. The CEO of its parent recently said that if the government could help make the numbers work, "he would be glad to give it another go."
https://www.northwell.edu/about/news/press-releases/while-preserving-its-population-health-commitment-northwell-withdraw-careconnect-nys-insurance-market
I'm wondering if you have the impression I disagree with risk adjustments. They are a logical necessity to make insurance work if insurers are barred from pricing based on risk. It's as simple as that. Getting it right is a lot more difficult.
- UnitedHealth "was due a net $281 million in risk adjustment payments" (small business mkt)
- "In the individual market, it had limited participation and was due a net $86 million"
- "The next highest beneficiaries ... received $13.5 (small group) and $48 million (individual)."
- "HealthRepublic of NY, went bankrupt owing its competitors $191 million"
- "It owed about 37% of its total 2015 premium revenue."
The point of these numbers was that there has been a massive transfer from the have-nots to the haves. If you don't see anything about next year's prices on the internet, you're just not looking hard enough. I've looked at all the 2019 rate filings for insurers I might be considering.>> It was known that under Obamacare that future rates would rise dramatically.
Compared with what? How do you think it would have gone if past trends had continued as they were going?
And what about being uninsurable?
What about Medicaid?
Fill us in, if you would. You are more acutely on point here than anyone most of us ever talk to or hear from about this.
Your observation "The fact that insurance is going up substantially next year, and every year, has been pretty well known for years. Nobody has done anything about it. Nobody." is certainly accurate.
This is such a complex subject that I'm frankly incapable of analyzing it to the depth of someone like msf. So I'm going to limit the following questions strictly to two of the primary elements that drive insurance rates- the direct costs of medical care itself. First, I'm considering doctor costs, both primary and specialist, all laboratory testing costs, all hospitalization costs, and all follow-up costs such as rehabilitation or therapy. In other words, the entire package of "medical care". Second, there are of course drug costs.
Since you are still alive due to significant expenditures in those two areas, I would be inclined to give a fair amount of weight to your opinions.
We all know what the story is with respect to the ever-increasing costs of just those two factors alone. Ignoring for the moment any consideration of rip-off inherent to the insurance industry itself, it's obvious that insurance costs are going to continually increase to the extent that those two factors alone increase. Given that,
1) Who is this "somebody" that has the expertise, judgement, and most importantly, the actual power to "do something about it"?
2) What suggestions or alternatives do you believe would be helpful for this "somebody" to consider that would realistically help to significantly lower the costs we are considering?
In other words, if you were the "insurance czar", what are the important things that you would do in just those two areas alone?
And then there's this to chew on: You are fortunate enough to be able to handle those insurance costs. Thanks to a very good retirement insurance plan, coupled with Medicare, so am I. What are your thoughts on coverage for those not so fortunate as you and I?