Watch Out Old Folks – Your Health Care is in Jeopardy

The people have spoken and close to a majority of voters in the United States voted to see the Affordable Care Act (“ACA”, “Obamacare”) health care solution repealed and replaced the day Donald Trump is sworn in as President.

Only a dolt would believe that’s actually possible given the millions of people that would be adversely affected, even Donald and Paul Ryan recognize there are parts of the ACA that work well and should be retained.

That said, something will happen and there is plenty of Capitol Hill noise about what plan(s) will replace ACA.

Mandatory Participation

One of the most popular gripes against ACA was that participation was essentially mandatory, with fines to be paid at tax time if an individual remained without health insurance.

Voters screaming for repeal because of that should keep their eye on a leading candidate for approval, the Patient CARE Act from Orrin Hatch (R, UT).

The CARE proposal is designed for mandatory enrollment. If an individual didn’t select a plan, effectively deciding to “opt out”, the CARE proposal would automatically enroll individuals in plans providing catastrophic coverage. Supposedly, these premiums would exactly equal a tax credit also proposed by Hatch.

Every person between the ages of 50 and 64 years old would have their premiums increased.

Continuous Coverage

Common to most proposed plans is a penalty for not maintaining continuous coverage. It’s part of a carrot and stick approach to discourage healthy people from opting out of health insurance temporarily, something the insurance companies are lobbying for.

Lip service has been given to making sure citizens with pre-existing conditions aren’t left without the possibility of purchasing insurance, yet some proposed programs purposely leave a giant hole for insurance companies to charge exorbitant premiums for clients with pre-existing conditions if their coverage ever lapsed.

Old People Will Pay More

How YOU doin'?

How YOU doin’?

The Ryan plan, called “A Better Way”, revises the rules for premiums to allow insurers to reduce the premium price for younger, presumably healthier enrollees while charging older enrollees significantly higher premiums.

ACA currently caps the “old guy” penalty at three times what a younger person would be charged, the Ryan plan increases that penalty to five times the amount.

That’s roughly a forty percent increase for older people not covered by Medicare.

Hoping to survive to Medicare years for respite from health insurance premiums?

Speaker Ryan has a Medicare zinger for you in the works, one he plans to piggyback on the more popular “kill Obamacare” activities.

Medicare Benefits Slashed

Ryan proposes increasing the Medicare eligibility age from 65 to 67. So, health care insurance consumers that included Medicare coverage in their budget for retiring will now have to recalculate their plans to include paying for commercial health insurance for an extra two years.

“A Better Way” includes potentially paying five times as much as a twenty year old for the same coverage. So, people will have to decide whether to forego insurance and hope for the best for a couple years or pony up the money they were going to piss away on that dream trip to Europe and use it to buy insurance.

If “A Better Way” ends up following the same retirement age proposal as Social Security, people born in 1960 and later will be the ones falling into the expense gap.

Disabled? We’re Sort Of Working On It

Old and young people with long term disability issues aren’t really addressed in “A Better Way”. Ryan notes the negative impact long term services and support (LTSS) have on the Medicaid bottom line, but refuses to address a resolution to that problem.

nutronr51lxpAlmost two-thirds of Medicaid spending goes to seniors and young people with disabilities.

Nearly a third of people reaching age 65 will have LTSS costs that exceed their ability to pay. These people will need Medicaid to help pay those costs.

“Block grants” are lump sum payments to states that are to be used to pay for Medicaid programs. Depending on the state, it’s more than likely changing Medicaid to a block grant payment system would result in cutbacks of services for people with no other place to turn for assistance.

Vouchers And Torts

The Medicare system will probably be radically altered from an earned benefits system to a premium support model. That’s a significant difference, putting the pressure on the consumers to come up with ways to pay insurance companies instead of pressuring the insurance companies that wish to participate to devise a way to cover the people that need health insurance.

That shift allows private plan providers to tailor their plans for healthy beneficiaries while ignoring the less healthy. In other words, back to normal.

While the ruling party uses verbal gymnastics to avoid the buzzkill word “voucher” in their published prose, Medicare will become a voucher system as soon as earthly possible. A “Medicare insurance exchange” will provide vouchers to reimburse people for paying private companies for their health insurance.

563The other fork of every proposal is to reduce costs through tort reform by capping non-economic damages awarded in malpractice lawsuits. That makes sense until it’s your life that needs to be put back together following a tragic medical happenstance.

Rather than devising a plan to reduce abuse of malpractice lawsuits with intelligent appraisal of each suit on it’s merits, the answer of using mandatory sentencing logic will be used.

Ignores Reimbursing Increased Costs

It’s been proposed that Medicare spending per beneficiary is limited to GDP plus one half of one percent.

GDP is an index that has absolutely nothing to do with health care costs. GDP per capita consistently grows more slowly than health care costs and there is no end in sight to that trend.

There is no mention of closing the gap if spending per beneficiary exceeds the gap, so that means it’s coming out of the fixed income wallet.

Oh SNAP You Like To Eat?

The Supplemental Nutrition Assistance Program (“SNAP”) will also be relegated to a block grant status.

Six million older people are currently eligible for SNAP, SIX million. Shifting responsibility of this program to states with potentially more volatile shifts in revenue streams is very likely to produce shortfalls leaving some of those six million Americans “food insecure”.

The end result of that shift could easily leave older people reliant on charitable groups for the food on their table.

Drop The Annoying Stuff

Ryan’s plan also eliminates the essential health benefits from mandatory coverage, something insurance companies are applauding loudly. Young and old enrollees in programs without these benefits will pay less, but will be covered for many fewer things than they imagine. Most won’t realize it until they need care from a health provider.

Ryan’s plan will not insist the following are covered:

  1. Outpatient care including home health services and hospice care.
  2. Emergency services, including allowing insurance that DOES include emergency care to not reimburse for emergency room visits out-of-network. Have your car crashes near an in-network hospital, people!
  3. Hospitalization, including medications received during a hospital stay and care received in a skilled nursing facility such as a nursing home.
  4. Maternity and newborn care.
  5. Mental health services and addiction treatment.
  6. Prescription drugs.
  7. Rehabilitative services and devices including things like speech therapy after a stroke.
  8. Laboratory services.
  9. Preventive services (such as mammograms for women over 50), wellness services, and chronic disease treatment including physicals, immunizations, and care for chronic conditions such as asthma and diabetes.
  10. Pediatric services including well-child visits.

Do you know anybody of any age that could use coverage for any of the above ten benefits? If so, please advise them to ready their new “replacement for Obamcare” health insurance policy very carefully.

Pay Attention To The Boogeyman

obamacareWhen people use dog whistle phrases to explain complex concepts in one word to a wide audience, that’s boogeyman politics.

Caution is advised when rooting for repeal of the Obamacare boogeyman. There were changes to the health insurance industry that were extremely beneficial to millions of uninsured people AND many other “regular” people.

With health insurance companies posting record profits, there was obviously less pain to them than they are crying about.

Be careful what you wish for, make sure you know what you will be losing. Keep an eye on DC because the swamp isn’t being drained, the same gators are there waiting to get their way. Listen all you want, but check their work because there’s a LOT of zingers in there waiting to bite your health coverage AND wallet.

2017 Annual Report of the Boards of Trustees of the Federeal Hospital Insurance and Federal Supplementary Medical Insurance Trust Funds – ‘Broke’ and Because of ACA? 11/16/2016

Forbes – What Paul Ryan’s Latest Health Proposal Would Mean For Seniors 6/22/2016

Vox – I read 7 Republican Obamacare replacement plans. Here’s what I learned. 11/17/2016

Obamacare Facts – Essential Health Benefits