The Biden folks have released what they claim is a “fix” for the alleged “family glitch” this week (if you don’t know what the family glitch is, look it up). Somehow, the folks at IRS and Treasury got themselves a new set of tea leaves, because the statute hasn’t changed in many years, since 2010. In fact, Team Obama made it a top priority for eight years and came to the conclusion that they couldn’t do it.

They were right; the statute is clear. Absent Congressional action, the fix they are proposing is fanciful legalese at best and an outright lie & deception (imagine that, from Washington D.C.) at worst.

Let’s be specific – in spite of media hyperventilation and Democrat machinations, the so-called “family glitch” isn’t a glitch at all. The statute, passed as part of the laughingly named Affordable Care Act, in the middle of the night, as a budget reconciliation bill, with no severability clause and with absolutely no Republican support, was the direct result of political consideration and policy restraint, designed to keep the costs below the threshold supported by Obama, as well as avoiding any disruption to the employer-based healthcare system (that would come later). In short, its language could not be more succinct.

That has now all been thrown out by artful lawyering by political appointees at IRS and Treasury, opening a veritable can of worms (not to mention class actions law suits .. “were you denied subsidized health insurance? Call Dewey Cheatam & Howe today!”) and an explosion of federal spending in the forms of large premium tax credits, made larger by the American Rescue Plan Act.

But apparently everyone thinks this is such a great deal! Sure, lets shrink the employer based healthcare system, moving 20 million or more people from employer-based coverage to taxpayer-subsidized health insurance on marketplace exchanges, continue to expand the federal deficit (hey, no shortages there, right?) and strengthen government subsidized healthcare at the expense of private health insurance. Cool, eh? Why, even my lobbying group, NAHU, apparently is all in on this (while ignoring the fact that the very benefit professionals who pay them dues to keep their lights on are endangered to extinction with this illegal expansion of Obamacare).

The Obama Administration concluded that the fix could not be accomplished without legislation from Congress. This fact, coupled with this new “rule”, means that the IRS and Treasury are now thoroughly politicized (if that fact doesn’t worry you.. well, more tea anyone?). The “firewall” has been breached.

What firewall, you say? The ACA has a provision that prevents employees from choosing between premium tax credits to buy an subsidized plan and enrolling in their employers’ private health insurance. This was designed to prevent people from ditching their employer-based health insurance in favor of a subsidized marketplace exchange policy (read: massively cheaper). This isn’t about maintaining and strengthening the healthcare system as we know it, far from it! It’s clear that the vast majority of people who gain eligibility under this scheme already have access to employer-based coverage. Do the math.

You can’t beat a government with a printing press. Insurance companies love getting free money from the government, because it never stops. Displacing private spending with government subsidies will greatly expand federal spending and actually lead to making life more complicated for folks who can’t understand their health insurance now – wait until they have two or more policies to deal with. Strengthening the public sector at the expense of the private sector has been a long, time-honored tradition with Democrats back to the age of FDR – and Democrats have made no secret that their end game is the destruction of health insurance companies in favor of a single payor government system. Right, Jan?

But I’m the canary in the coal mine. Step right up, folks, the gravy trains a-rollin’.

https://www.washingtonexaminer.com/news/white-house-to-send-principles-for-obamacare-replacement-plan-to-capitol-hil

An excellent idea, assuming the engineered gridlock can somehow be broken

Along with the collapse of Colorado’s own co-op, Colorado HealthOP, comes new that about 50% of the non-profit health coops spawned as a result of Obamacare have failed, with the loss of $2.4B in loan money. See the story here.

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.

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.

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

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!

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.

Anyone who thinks that Obamacare was about heath care, let alone health insurance, reform, is either, at best, naive, or, at worst, completely ignorant of the law – and how it was passed, and the consequences of its various statutes, regulations, rulings, and case law.

Obamacare was about social engineering – much the same way that Common Core is about federal control of school curriculum, to advance certain, shall we say, dogmas that most of us would find puzzling, if not outright outrageous.

But I digress. I’ve often told those that will listen that I could have written a health insurance reform proposal that would have numbered a few hundred pages and would have been much, much more successful than the Affordable Care Act, assuming that its goal was the elimination of the chronically un-insured in these United States, probably around twenty million or so (it wasn’t, re-read paragraph two). And, it certainly would not have cost upwards of $2T plus that we see now (and that figure will continue to rise, even as deductibles rise, and out-of-pocket expenses rise, and so on). And I would agree that reform was needed, just not what we got.

James C. Capretta is one of a handful of experts who I respect wholeheartedly with regards health care reform policy. In this article he lays out the compelling reason why we need, not just to repeal, but replace Obamacare: because reform is just as needed now, as it was in 2009.

Here is the most interesting conclusion that Mr. Capretta advances: “The hard work of developing a credible alternative plan has already been mostly completed. What is needed now is a spirit of practical compromise among key Republican policymakers. It will not be possible to beat an incumbent program — the ACA — with abstractions, good intentions, and idealistic concepts. What’s needed is a workable, politically viable plan, one that voters can see for themselves would work better than the ACA.” 

As the article points out, the hard work for a viable replacement for the ACA has already been done. It will take Republicans to advocate for it in a forceful way. And, if SCOTUS disallows the payment of premium credits in the federal exchanges, as detailed in King v. Burwell, then Republicans won’t need to wait for control of the White House to replace Obamacare.

Much ballyhooed numbers on Obamacare enrollment are released, with an estimated six million enrolling, but  Rep. Marsha Blackburn (R-Tenn.) expresses doubt. See the video and news story here.

Even in the face of such strong enrollment numbers, though, which have not yet been verified, the government has moved to extend the open-enrollment date for federal exchanges, even after a Centers for Medicare and Medicaid (CMS) spokesperson said “we don’t actually have the statutory authority to extend the open enrollment period in 2014.” And of course, she is correct, as reported here. The open enrollment period is specifically defined by statute, and isn’t open to interpretation. Forbes has an interesting article on it, go here.

What this means is that people who have recently fallen ill or are otherwise uncovered will be able to get health insurance beyond the open-enrollment date, something that troubles insurers, some of whom are predicting double digit rate increases for 2015.

UPDATE: Here are three little questions about those Obamacare enrollment numbers.

“The Associated Press-GfK survey finds that [only] 26 percent of Americans support the Affordable Care Act.” Read the full story here.

Compare this to the Kaiser Health Tracking Poll from April 2013, found here. One quote from the piece shows slippage in support over the last year: “This month, 35 percent report a favorable view, 40 percent an unfavorable view…”

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.