Health Insurance Info for Colorado

news & commentary on health insurance and benefits

ColoradoCare raises its ugly head.. again!

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Many years ago (ancient history for many, since it was in the last century) a certain Colorado Governor demanded the reform of Colorado’s health insurance regulations, or he’d bring a “single payor system” down on our heads. it was to be called, if memory serves, ColoradoCares. Reform happened, so it went away. But you know, the relentless need to have a government-run health care system never goes away with Democrats.

Well, its back, and it’s even worse. Here’s a quote: ” a “risky and untested state-run health insurance system.” State-run, as in, the state of Colorado, and financed with a whopping big tax increase, larger than the size of the entire Colorado budget. It will replace Obamacare. And no, that would not be the kind of replacement I’d be in favor of!

If you love Obamacare, you’ll love this – until you don’t.

Read the full story here.

 

 

 

NEWSFLASH: Colorado Health OP

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The Colorado Division of Insurance moved swiftly to remove Colorado HealthOP from the list of approved insurers in Colorado and through the Connect 4 Health Colorado Marketplace Exchange. See the news release here.

Colorado Medicaid Sign-ups Defy Expectations

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Politico, May 19, 2015: “Colorado has repeatedly revised its average enrollment estimates to account for increases. Early on, officials had projected that for the fiscal year ending June 30, about 144,000 new adults would be covered in any given month. In November, they bumped the number to nearly 205,000. It currently stands at about 234,000.”

See the full story here.

 

Obamacare Premium Increases Coming

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Insurers have a new year of data and the numbers don’t look good. It will be very interesting to see what Colorado rate increases will look like. As usual, for those on subsidized policies, this news will be met with a shrug, since the “I got mine” mentality is in full swing. For everyone else, the rates increases, be they at the low end (say, 10%)) or the high end (say, upwards of 30%) will be particularly savage, and, as individual rates continue to resemble small group rates in all states, it will be increasingly difficult to absorb rate increases coupled with assessment fees to Connect For Health Colorado (on ALL health policies sold in Colorado), along with high deductible and out-of-pocket costs. The reaction I get from people with families looking for individual plans run the gamut, with “HOW MUCH??” and simply stunned silence the most common refrains.

More Health Insurers Seek Double Digit Premium Increases

Gruber-ized in Colorado!

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Everyone’s aware of the infamous Gruber statements. Let me paraphrase: you’re all idiots – now pay me. Followed by an evil laugh.

Well, apparently the good folks over at your local Marketplace Exchange, Connect For Health Colorado, fell for it, too. (And I should add a disclaimer that I am a Certified Agent for C4H-CO, and I’m just reporting the facts, Ma’am).

Those pesky folks over at the Independence Institute, namely their Health Care Policy Center, run by the charming Linda Gorman, an economist by trade and a member of Colorado’s Blue Ribbon Commission on Health Care Reform, have published a very interesting piece of analysis titled “How The Gruber Model Failed In Colorado”. You can get it here. The bottom line assessment? “Its poor predictions will likely end up costing taxpayers billions of dollars”.

This is so good it’s hard to summarize: I think anyone interested in the effects of Obamacare and the lackeys employed to carry the water for it should read it, re-read it, and pass it around. And, if you know anyone in Vermont …

Seriously, I’m no economics expert (or anything else for that matter, except maybe good coffee) but for really educated folks to buy into Grubers’ predictions, as highlighted in the reports and analysis he got paid to do by Colorado, simply defies explanation. I mean, really: the idea that, based on somebody’s economic assumption, there wouldn’t be an almost catastrophic rise in Medicaid recipients is simply stunning. As almost anyone who’s been around the health insurance business knows, it isn’t the folks who can buy insurance and don’t who are the biggest problem, it’s the folks who couldn’t buy coverage at all due to extreme low-income or other circumstances. The farcical notion that many more people would get subsidies rather than a short trip to Medicaid says that no one really understood what’s been happening in Colorado. Guess what? Medicaid enrollment has exceeded expectations by 40%, and drastically overestimated the demand for subsidized policies (one-sixth of what was projected!).

Even unsubsidized policies are far below Grubers’ prediction. (And here’s an odd thing: why would anyone buy an unsubsidized policy through the exchange, anyway? There is simply no reason to buy an unsubsidized individual policy through the Marketplace exchange – something that comes as a surprise to many people.)

The reports go on to (laughably) suggest that insurance premiums would go down “27% on average”, with people buying richer plans because of their tax savings. I should send this to my clients who have a) had their premiums rise at least that much, b) their deductibles go up dramatically, and c) their networks and doctor choices curtailed, seeing that the market switched from PPO to HMO offerings almost immediately. That would be all of them, by the way.

The list of predictions that were wrong read like a list of Obama statements, that’s for sure! Like Grubers’ predictions that people in grandfathered plans would “see no change in their premiums”. Actual fact: they rose by 37% by early 2014.

And we won’t even talk about how Obamacare wrecked a high-risk pool that was actually cheaper than it’s replacement (and rather than an HMO was an any willing provider network, to boot).

This, my friends, is what happens when common sense and good public policy get replaced with redistributive ideology: any argument works so long as it advances the political objective, true or not. And the essence of Obamacare wasn’t about “health insurance reform”, it was about federalizing the health insurance markets prior to a move to a single-payor system (that’s my own opinion, by the way, not anything taken from the report).

Best take-away quote: “.. substituting tax subsidies for direct payment does not affect the cost of health insurance”. Of course not.

Download it, have a good read, and discuss it. Better yet, share it with every Colorado legislator you can! Good job, Ms. Gorman!

 

 

 

 

The Alternative to Obamacare is Easy

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I’ve said for some time that “health care reform” wasn’t the goal of Obamacare, and it certainly shouldn’t have cost however many trillions of dollars thats been forecast to pay for it (the actual figure isn’t important, save for one fact: it’s a lot more than we were promised, before we knew “what was in it”).

The mass media seems to be of the opinion that Republicans have no alternative to Obamacare, but the truth is that any number of alternative policies have been discussed within Republican circles. Most critics of outright repeal like to point out that the individual and employer mandates were Republican ideas; this canard has been bandied about for so long that it now been accepted as fact. The reality is that the mandates were viewed as essential only by a handful of think-tank policy wonks, and never really achieved critical mass with conservatives who study health care policy closely.

One of those individuals is John C. Goodman, from the Independence Institute. Mr. Goodman is considered to be the “father” of the health savings account, and he has a brand new article on what Republicans can do, now, to repeal the worst parts of Obamacare. In a previous article, “How The GOP should now deal with Obamacare”, he discussed the pitfalls that Republicans will likely encounter as they try to “repeal and replace” Obamacare with a new system that will inevitably be some version of what is currently in place.

In “A Republican Alternative To Obamacare”, he expands on his earlier work, by advising Republicans to concentrate on the promises made to voters in the 2014 elections: “keep your job; keep your health insurance; and keep your doctor”. And his solutions to health insurance, and health care, issues are the best I’ve read, encompassing great ideas and solutions to the kind of Washington-driven, centrally-planned health insurance environment we find ourselves in, with narrow networks, a return to highly steered “managed care”, rigid health care design, and lack of choice and flexibility.

I highly recommend the policy solutions he puts forward, and dearly hope that someone in the Republican leadership is listening and taking copious notes. The bottom line is this: without a clear cut and simple approach to replacing the disaster now known as Obamacare, Republicans will stand little chance of gaining any ground against entrenched interests, which include progressive Democrats, insurance company executives, and others who are beginning to reap the benefits of a quasi-monopoly driven by the central planners at HHS. Taking the alternative directly to the American people is the best way to get the message out, and that requires more than a statement in front of a podium at the Capitol, which is essentially all we’ve been given from the current Speaker of the House. It requires a full-court press by the leadership, because there isn’t a more pressing issue than repeal and replace Obamacare. I believe the political will can be found, and not just from Republicans.

The Affordable Care Act Turns Four…

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The American Action Forum has published an eye-opening research paper on The Affordable Care Act, and comes to the conclusion that “regulatory costs exceed benefits by twofold”.

From the opening summary: “From a regulatory perspective, the law has imposed more than $27.2 billion in total private sector costs, $8 billion in unfunded state burdens, and more than 159 million paperwork hours on local governments and affected entities. What’s more troubling, the law has generated just $2.6 billion in annualized benefits, compared to $6.8 billion in annualized costs. In other words, the ACA has imposed 2.5 times more costs than it has produced in benefits.”

For the full report, including the employment impact and policy implications for small business, go here.

This New O-care Regulation Could Affect You

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From The Foundry at The Heritage Network, originally published in National Review Online: “One excepted benefit that  .. could serve as a lifeboat if the voyage of the SS Obamacare goes as badly as we have feared: indemnity insurance .. anything that constitutes an excepted benefit under HIPAA remains exempt from all of Obamacare’s new insurance regulations.”

Well, not anymore it seems, as Centers for Medicare and Medicaid Services (CMS) unilaterally decided to amend HIPAA to suit themselves. As usual, the government drops its bad news on Friday evenings when we are all exhausted from working to pay for our health insurance premiums (or not, if you’ve decided to pay the penalty). Go here for the full story.

And this quote is especially telling: “.. this latest proposed Obamacare regulation, like many before it, isn’t even a remotely plausible interpretation of the statutes that Congress actually passed. This latest “fix” is worth fighting — both to keep the lifeboats intact during this dangerous voyage and to keep a sound insurance option in place for the long haul.”

O-Care Premium Spikes Coming

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One of the most frequently cited ways that insurers used to reduce costs for the new ACA compliant plans was to engineer new provider networks, primarily HMOs, with lower fee-for-service reimbursements, referred to as  per-member-per-month arrangements. These networks were reviewed at the state level for adequacy. In fact, the new networks were substantially smaller, as many physicians opted out of them due to reduced reimbursement rates or capitation necessitated by the new rules carriers must operate under due to Obamacare.

The federal government decided that this won’t be acceptable for 2015.  In a draft letter from the Centers for Medicare & Medicaid Services (CMS), insurers will be required to include 30% of “essential community providers” (ESPs) in their network.

ESPs serve primarily “underserved” populations, including community health centers, HIV/AIDS clinics, family planning clinics and children’s hospitals. From Insurance Business: “In order to assure this is the case, CMS plans to establish its own process for certifying adequate provider networks, cutting out the role of state regulators.” See the full story here.

CMS, in 2013, stated that, for 2014, they would “rely on state analyses and recommendations when the state has the authority and means to assess issuer network adequacy.” See the full text of the earlier guidance here. For 2015, with CMS expanding the ESP requirement,this will likely increase premiums further, due to an increase in network providers mandated by CMS.

Other changes that will have a cost effect on premiums include changes to stand-alone dental plans, and a new requirement to pay for a 30-day supply of any new drug that a new customer had been taking—even if the drug would not have ordinarily been covered.  For the complete 2015 guidance, go here.

Insurers are rightfully concerned about the new requirements, with America’s Health Insurance Plans (AHIP) already expressing its disapproval in comments filed on the proposed changes. Insurers have just weeks to present their changes, with some deadlines beginning in April of 2014.

Obamacare: premiums “to double”

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Health industry officials say Obamacare premiums will likely double, and in some cases triple, in certain parts of the country next year, in part because of the flawed launch of the new exchange marketplaces mandated under The Affordable Care Act. Announcements of rate hikes could come within months, with the most significant cause of rate increases related to projections about the number of young healthy individuals and families who would enroll, which have proved to be way off the mark.

The projection of double or triple-rate increases fly in the face of remarks by HHS Secretary Kathleen Sebelius, who said that “the [rate] increases are far less significant than what they were prior to the Affordable Care Act,” in testimony before the House Ways and Means Committee last week. This runs contrary to the way health insurance industry officials view rates in the coming year.

We’ve all been hearing about how younger people aren’t signing up in anywhere near the numbers needed or projected. So, why are young people important? In a phrase: adverse selection, which means, far more older, sicker people than younger, healthier ones in the pool, which creates – wait for it – higher claims costs that are almost certainly not supportable by current premiums.

In an article entitled Young Invincibles Are Killing Obamacare, Megan McArdle writes for Bloomberg View: “Young healthy people, and a lot of them, are needed to keep the market stable and premiums low. As we head into the final few weeks, we have a pretty good idea of how many young healthy people there will be, and the answer is: a whole lot fewer than the healthcare wonks were expecting.” Unfortunately, her dismissive analysis of the coming “death spiral” of Obamacare was flawed, even if she herself says that reaching anywhere near projections for young enrollees is “not likely”. Surprisingly, she concludes: “… it is now probably impossible to achieve the demographic mix that the government has been forecasting. And keeping it from happening may well prove very expensive for the federal government”.

How expensive? In his blog ACA Death Spiral, Seth Chandler, a law professor at the University of Houston Law Center, writes a thoughtful analysis on the Kaiser Family Foundation study of early, low enrollment of younger participants in Obamacare, cited by Ms. McArdle in her column. His analysis and conclusion is posted as “The Kaiser analysis of ACA enrollment has problems”, and is a good, if somewhat dense, analysis of how difficult it is to make an accurate projection, and why the projected deficit in insurer profits isn’t 2.4%, as projected by KFF, but “rather a  [deficit] projection of 4.5%”.

This is not good news for premiums, or for costs related to Obamacare that the federal government will be required to pay for. With rates for 2015 likely being filed this summer for approval prior to 2014 open enrollment, it increasingly looks like Obamacare will be the election year issue of 2014.

Obamacare individual mandate: slip-slidin’ away!

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Today, The Wall Street Journal reports on  Obamacare’s secret mandate exemption. An amazing read!

A few choice quotes below:

“last week the Administration quietly excused millions of people from the requirement to purchase health insurance ..”

“the mandate suspension was buried in an unrelated rule that was meant to preserve some health plans that don’t comply ..”

“shifting legal benchmarks offer an exemption to everyone who conceivably wants one.”

The article concludes: “The larger point is that there have been so many unilateral executive waivers and delays that ObamaCare must be unrecognizable to its drafters, to the extent they ever knew what the law contained.” Indeed.

 

The Supreme Court decides

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Media reports suggest that today (or, at, least, this week) the Supreme Court will hand down its decision on The Affordable Care Act. To briefly recap, dozens of states sued the federal government to overturn the act; the reasons for that suit are varied, such as the individual mandate, but include such issues as Medicaid funding requirements, which is a huge unfunded liability for states.

I’ve resisted the urge to handicap the forthcoming possibilities, but I do have an opinion. Right or wrong, I’m going to publish it today; one way or the other, the debates between Mr. Obama and Mr. Romney about health care in the upcoming general election will be fascinating to discuss in light of what the SCOTUS decides.

There are four possible outcomes: to do nothing and leave the entire Act standing; to narrowly strike down just the mandate provisions; to strike down the mandate and two other major provisions (which is the position that the Obama Administration said should happen if the Supremes conclude that the individual mandate is unconstitutional), and the fourth: declaring the entire Affordable Care Act unconstitutional.

I have no idea what the “Vegas line” is on this decision, so, I will take my shot-in-the-dark and lay odds:

Do nothing: 12 to 1. Not likely.

Strike down just the individual mandate: 6 to 1. Too narrow, and creates a bigger problem.

Strike down the mandate and the provisions relating to it (the position argued by the Administration if the mandate is unconstitutional): 4 to 1. The Administration wins, and the remaining Act becomes a rallying cry for progressives who always wanted the single-payor option (and this decision almost guarantees it).

Strike down the entire Act: 3 to 1. The most sensible solution of all.

My reasons for giving the best odds for striking the entire Act lay in the unprecedented suit brought by a coalition (frankly, a majority) of states against the federal government. I’m unaware of any action brought against the government by so many states, and this alone should prompt an unprecedented examination of the role of the federal governments’ power to pass legislation that intrudes on the right of the states to govern themselves. It also bears pointing out that the federal government is, technically,  a government of limited powers (the term “states rights” is not a pejorative for discrimination, despite what liberals have always said) with the remaining powers reserved exclusively to the states. With the individual mandate exceeding any rational understanding of the purpose and use, even in liberal hands, of the Commerce Clause, the demand by the states to be relieved of a burden they clearly feel is unconstitutional has to be carefully considered. The strange manner in which the Act was passed, the lack of ANY bipartisanship (or, of that matter, any input from anyone except the Progressive Caucus in the bills ultimate form) the distorted cost projections, not to mention the majority view of the Act across the nation by voters – all of these things must be taken into account by the Justices. Never mind that they are legal scholars who pass judgment on constitutional issues at the highest level; there is and always will be a political element to every controversial Supreme Court decision. Couple this with the lack of a severability clause, and my opinion is that the Supremes err, not on the side of caution, but on the side of good sense: telling Congress that this legislation is so flawed and so intrusive that it would be best to just start over.

And that is what I think the Supremes will do. If they don’t, they will be performing a major disservice to the country, by leaving in place a huge entitlement program that completely remakes the social contract between the government and its citizens (or should they now be called subjects?) without any rational means to pay for it (assuming that the Commerce Clause doesn’t allow the government to tell you what you must buy), while dooming a portion of the insurance industry to almost-certain extinction or, worse, outright nationalization or regulation as a monopolistic utility, with the government calling ALL the shots, while re-distributing massive tax increases to pay for it.

Whatever they decide – it’s going to be interesting. And don’t forget that, in the absence of any new federal legislation, states, including Colorado, will be in a position to craft their own solutions, which is how it should be in the first place. The fact is that Colorado state Republicans control the House by a slim one vote margin – and history shows that in the early 90’s, Colorado’s Governor Roy Romer (D) threatened to pass a single payor system unless “health reform” was enacted, which set us upon the very path we now walk.

Let the games begin! Quoting Rep. Michele Bachmann: ““The decision on Obamacare goes well beyond health care,” she wrote. It “will determine whether or not the court believes the government has a right to mandate that Americans buy a product or service, a direct impact on our freedom and liberty.”

 

 

 

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