Health Plans’ Mastery of Obamacare Poses Challenge To Repeal
(A similar version of this Health Alert appeared at Forbes.)
Can Obamacare still be repealed? Well, that depends. If the politicians will legislate according to the people’s preferences, Obamacare is a jump-ball.
According to the Kaiser Family Foundation’s latest tracking poll, 43 percent have a generally favorable opinion of Obamacare, while 42 percent have a generally unfavorable opinion. Further, 22 percent claim Obamacare has hurt them or their family directly, while only 19 percent claim it has helped. That leaves more than half who do not think Obamacare has directly affected them.
Perhaps the 25 million who have become insured or dependent on Medicaid after Obamacare rolled out will confirm its success. Actually, there has been no improvement in access to care due to Obamacare. The Commonwealth Fund reports that 35 percent of adults delayed medical care because of cost last year – versus 37 percent in 2005. Further, the proportion of adults ages 19 through 64 who had a medical problem but did not visit a doctor or clinic was 22 percent in 2003 and 23 percent last year. Thirteen percent did not receive needed specialist care last year – the same percentage as in 2003.
Basically, when it comes to access to care, Obamacare has returned us to the status quo from before the Great Recession – at great cost to taxpayers. And that is only the picture in broad strokes. Very few people account for most medical spending, and those very sick people are doing poorly in Obamacare plans. A politician who offers a compelling plan to restore prosperity, as well as repealing and replacing Obamacare, should not face overwhelming odds convincing Obamacare beneficiaries.
The real obstacle to advancing an alternative to Obamacare will be interests in the health sector, which has mastered Obamacare remarkably. The latest evidence is the first quarter earnings reported by UnitedHealth Group and Hospital Corporation of America, both of which Forbes colleague Bruce Japsen describes as having had the “best Obamacare quarter yet.”
UnitedHealth Group posted revenues of $36 billion, 13 percent more than Q1 2014. The stock jumped 3.6 percent on the news. Every part of the firm’s domestic business did better than expected: Medicaid, Medicare, employer-based benefits and Obamacare exchanges.
Growth in health plans’ Obamacare exchange and Medicaid business is to be expected. However, the continuing success of private Medicare plans (called Medicare Advantage) continues to surprise, because Obamacare was supposed to cut their payments. Snatching this victory from the jaws of defeat was the real test of health plans’ mastery of Obamacare, and they have done it.
Further, they are keeping medical claims under control. Obamacare supporters continually remind us that Obamacare forces insurers to give rebates to customers if they make too much money, and that this is causing them to lower overhead and profits. Financial analysts roll their eyes at such claims. UnitedHealth Group’s ratio of medical spending to premiums dropped from 82.5 percent to 81.1 percent, but that did not come out of overhead or profits.
As a result, UnitedHealth Group and other health plans are a far greater obstacle to repeal than Obamacare beneficiaries are. A successful alternative reform would have to convince them that the potential reward is higher than the risks. Here’s what that would look like:
First, people recognize that Obamacare induces insurers to enroll healthy people and shun sick people, making health plans less popular than ever. An alternative reform that improved the incentives for health plans to seek out sick people would be achieved through superior risk adjustment, whereby plans which over enroll healthy people reimburse plans that over enroll sick people.
Second, both Obamacare beneficiaries and the general public recognize that the health insurance exchanges are frustrating experiences that cost a lot of money. Scrap them and let people buy health insurance from brokers and agents, either on line or in person. This will make the purchasing experience less painful and should benefit insurers.
Third, convince insurers that Obamacare is bad for the economy. Obamacare’s taxes have harmful incentives, including reducing working hours. An improved system of tax credits for buying health insurance, which would not phase out so steeply as incomes rise, would motivate people to work more hours. Health care a superior good: The more income people earn the more health care they want. So, health plans should welcome such a reform.
Convincing health plans that there is a better future than Obamacare is not an easy lift. Neither is it impossible.
The healthcare sector(hospitals, insurance companies) helped write Obamacare. The American Board of Medical Specialties who is in charge of board-certifying doctors made sure it had its input to forever imbed board certification with practicing medicine and being paid by third parties.
The Trial Lawyers helped ensure no malpractice reform was included in the ACA.
If anyone wants to repeal or revise Obamacare, they are going to have to get by these powerful lobbies first. Meanwhile, patients and physicians will continue to be forced further apart by these special interests.
Thank you. I have yet to identify one segment of the health sector which is harmed by Obamacare. Individual physicians in private practice, yes, but Marcus Welby, MD, is an artifact of a bygone age, I fear.
Physicians will now be essentially government employees without the benefits. And I don’t think patients will benefit, either.
“I have yet to identify one segment of the health sector which is harmed by Obamacare.”
I will try to be respectful, but are you serious?
Harmed groups:
1) Patients
2) Physicians
3) Physicians with a conscience
4) Poor
5) Elderly
6) Tax payers
Harmed Values:
1) Freedom
2) Life
Any short term benefit that might be construed will crumble with the government/big business control of healthcare over time. Taxpayers will foot the bill.
Thank you. I did mention physicians as the exception in my comment. The other parties you mention have also been harmed, but I don’t include them in the “health sector”, by which I mean the large institutional players with DC offices that have revolving doors to the agencies and Capitol Hill.
We agree fully once the term “health sector” is clarified.
A lot of good points,thanks, but two points do not totally ring true.
a. The popularity or unpopularity of the ACA is hard to gauge.
Some older persons think that Medicare has been cut back to fund the ACA.
That is not true ( I sell Medicare Supplements), but the Republicans got a lot of traction on this myth in 2010.
Also, there is frankly a racist element that will oppose anything with the name Obama in it. See the enclosed comment on Kentucky:
http://www.politicususa.com/2014/05/12/plurality-kentuckians-obamacare-long-called-kyne
b. Risk adjustment – You propose a scheme like Germany’s, where plans with healthier enrollees compensate other plans with unhealthy enrollees.
I cannot imagine a US Congress enforcing this (even if they should). Where would health plans get their profits?
Thank you and I agree that framing an issue can shift people’s answers. But I don’t think that 29% of Kentuckians favoring Kynect is a big thumbs up. And the article you link to does not suggest racism.
Actually, the ACA does have risk adjustment mechanisms built into them, at least for a while. Both the Risk Corridor and Risk Adjuster portions of the “3 R’s” (the other is the transitional Reinsurance program) apply prior to the MLR requirement. It is now going to be very difficult for a carrier of any size in a particular state to actually reach “excess profit” as defined by the MLR, and have to pay a rebate. That having been said, the carriers can attain higher $ profits by increasing rates (to the extent they can get them past the regulators), since an 80% loss ratio on a higher figure means the 20% available for expenses and profit pushes the dollars up as well.
Yes, it does have risk mitigation but not good enough, apparently. (I use the term “risk mitigation” so as not to confuse with “risk adjustment” as defined by ACA). Medicare Advantage appears to do a better job of risk mitigation.
I grant you, John, that the racism comment was my idea. It is my belief that some Americans will oppose
anything with Obama’s name, out of resentment that he won two elections.
This is tricky, because a lot of Obama’s programs are very flawed, and anyone can legitimately oppose them even if they were called BidenCare.
But there do seem to be people who like the exchanges and yet still tell pollsters that they dislike ‘ObamaCare.’ Why do they say this? I vote for racial resentment. I sure could be wrong.
Actually the largest number of persons harmed by the ACA are probably in the small group markets, and they are not necessarily very prominent in these polls.
To Dr Potter:
I appreciate your comments, but let me challenge a couple of categories:
a. the poor are not harmed by obmancare. 10 million plus poorer persons now have Medicaid, which is wildly imperfect but still better than pure charity care (I have a child on Medicaid, I see great improvement for him)
b. Patients have been shoved around by insurance companies for 20+ years. Obamacare did not improve this much but sure did not create the problem.
The same is true for physicians.
Comments?
With a poll about people’s favorability feelings about ObamaCare, I would be interested to know to what extent those polled have actually used ObamaCare. Someone who had one appointment with their regular doctor will hardly feel the same way as someone who needs serious tests and several visits or someone who needs an operation. What about someone who gets sick on a trip and discovers that they are not covered outside their home location? Or the Medicaid patient who cannot find a physician who will accept Medicaid patients?
Thank you. That’s the thing. Polling a random sample of the general public doesn’t tell us much. Polling people who actually need care tells us that Obamacare has not achieved much of an increase in actual access.
%first_paragraphWhat should you not stack away in the garage? Your garage does not have to be a trying site to get coordinated. Garage storage is one of those spaces that is oftentimes difficult to organize. What is the method you acquire great garage storage ideas? You merely may want a trifle of assistance. What is the manner you understand when you are seeking to stash away overmuch in the garage? What should you stack away in the garage?
Since everyone wants to have a nice organized garage, and nobody likes clutter and mess, it is important to take a look at what sorts of options you really have when it comes to making sense of your garage space. Gladiator GarageWorks is a company that puts out some of the coolest garage organizers and systems on the market today.
You should also decide on the number of shelves you will hang. For an easier task, you can also purchase a DIY shelf bracket kit from a home improvement store. The second step involves deciding on the length of your shelves orgarage storage cabinets. You can also find these from many online stores. You should also determine the width of the pieces of wood by measuring out from the garage wall. Use a measuring tape to measure the length and of course, make sure you note the length because you will use this note later. If you cannot cut the pieces of wood by yourself, you can take the shelf dimensions to a home improvement store or lumberyard and choose the lumber for your DIY project and have the store cut each shelf to the right size. Purchase as many kits as needed for each shelf but make sure you allot two brackets for each shelf. These DIY kits usually come with a track system that may require you to screw them into studs.
And they all allow you to put everything you have in it’s own special little place. But let’s face it, some people just don’t want to go to all that trouble! Let’s face it, not everybody has the desire, time or energy to set up a real nice and organized garage storage (karat-china.com) system in their garage or shop. I had a neighbor once who had his own garage storage solutions, I studied it a bit, asked him some questions to help me solve some of the mystery behind his thinking, and came up with some basic guidelines to what he does. Any super organized system is going to cost some money; granted, some are very affordable and others are more expensive. I call his system The Lazy Man’s Guide to Garage Storage, and here are some basics in a nutshell.
The same principles apply, just on a lager scale. Organize your stuff by topic, just like you would in a filing cabinet. Some common things that you may need garage storage for include: gardening tools and supplies, sports equipment, Christmas and other holiday decorations, regular household tools, and kids outdoor toys.
Garage storage solutions offer you a way to take an area, room or garage and turn it into a spacious abode. You can avoid the extra expense of using paying rent to a storage facility; you can keep your items on your property and become a more organized person in the process.
Now, instead of trying to figure out how to just effectively store a bunch of miscellaneous things, I am trying to figure out how to also integrate other activities that used to happen in my larger house; things like working out, relaxing in the family room, playing games with the kids, etc. In fact, this raises an interesting problem I hadn’t even thought of at first. So while I’m glad to have a large space, I’ve discovered that it isn’t the space itself that matters most when it comes to garage storage. When I sold my house and moved into a smaller house in another town, I learned right away how much I missed having a garage. I really thought that having a larger space would solve my garage storage problems, but that hasn’t necessarily proven true. But, luckily, the new place comes with a large out building where lots of stuff gets to live.
Gladiator garage storage cabinets are very durable. This means the strength of steel with a sleek tread plate design and a durable powder coat finish. They also use oversize casters and piano hinges on their cabinets. They are made from heavy duty materials that are built to last.
By combining the different styles of cabinets, slat wall kit, hooks, and baskets together anyone can design and implement their own customized garage storage solution in minutes. Then you will be able to find anything you need at any time.
What if you could have an organized area for your tools, lawn equipment and your vehicle? You would probably use the area as a workspace for many projects. You would not wait until spring to find tools. They will consult with you, find out what you store in your space normally, and they will work with you to create a space that is useable to your needs for garage storage. There are companies that can give you exactly what you need in garage storage.
The wall slot garage storage system allows you to rearrange or add components are your needs change. Casters are optional on many cabinets so that you can move your tools with you as you work. They are very versatile because all of their products are modular.%