Healthcare-Left & Right

The Law From The Left

The Patient Protection and Affordable Care Act (PPACA) substantially reduces the number of people in the U.S. without health insurance, primarily by significantly increasing the number of individuals receiving government funded Medicaid, creating new federally funded health care subsidies, and establishing a federal mandate to purchase health insurance or pay a penalty.

(All statements for the left are from the non-partisan Congressional Budget Office (CBO) and Center for Medicare and Medicaid Services (CMS). Occasionally minor word adjustments may have been made for clarity or to reflect the updated nature of the subject. Verify and view in full context as often as possible.)

For a more detailed look at the new health care law, see our Fast Facts Health Care section by clicking here.

The ideas from the Right

The data below represents a culmination of ideas from the right aimed at lowering costs to governments and consumers in order to reduce the number of people without access. These ideas focus on expanding high quality primary care access to high risk, uninsured, and undocumented workers by making it affordable. The goal also includes expanding health insurance access by removing primary care services from their role and thereby making them much more affordable.

The Congressional Budget Office has scored a few Republican proposals, but none of those proposals mirror this presentation. However, CBO scores for those proposals may be presented here as evidence of successfully lowering the cost of premiums and costs to the government. Should you prefer greater discussion about this vision of health care reform in America, you would need to contact your elected officials.

Costs/Deficit

 

Budget deficits would be reduced, in CBO’s estimation, if the provisions in the new health care law remain unchanged throughout the next two decades. However, the legislation would maintain and put into effect a number of provisions that might be difficult to sustain over a long period of time. Whether any of its provisions—and if so, which ones—might be changed in the future is not for CBO to judge. Verify here

 

The new health care law includes a number of provisions that are intended, in part, to help control health care costs and to change the overall trend in health spending growth. Many of these are specific to the Medicare program. Verify at Page 12

 

Higher balances in the (Medicare) fund will give the government legal authority to pay Medicare benefits longer, but most of the money will pay for new programs rather than reduce future budget deficits and therefore will not enhance the government’s economic ability to pay Medicare benefits.  Verify here

 

CBO projects that if current laws do not change, federal spending on major mandatory health care programs will grow from roughly 5 percent of GDP today to about 10 percent in 2035 and will continue to increase thereafter.  Those projections include all of the effects of the recently enacted health care legislation, which is expected to increase federal spending in the next 10 years and for most of the following decade.   Verify here

 

Both the expansion of eligibility for Medicaid and the provision of subsidies through new insurance exchanges will increase federal spending. At the same time, the legislation contains various provisions that will substantially reduce spending on Medicare relative to what would have occurred under prior law. Verify at Page 8

 

Although several provisions would help to reduce health care cost growth, their impact would be more than offset through 2019 by the higher health expenditures resulting from the coverage expansions.  Verify at Page 4

 

Public spending would increase under the PPACA as a result of the expansion of the Medicaid program and additional CHIP funding but would be reduced by the net Medicare savings from the legislation. Private expenditures would decrease somewhat because of the net reduction in the number of persons with employer-sponsored health insurance and the reduced benefits for plans affected by the excise tax on high-cost employer coverage.  Verify at Page 18

 

By 2020, national health spending is expected to reach $4.6 trillion and comprise 19.8 percent of GDP.  The government-sponsored share of health spending is projected to increase from 45 percent in 2010 to about 50 percent by 2020, driven by expected robust Medicare enrollment growth, Medicaid coverage expansions, and Exchange plan premium and cost-sharing subsidies.  Verify at Page 1

 

The March 2010 health care legislation also established the Independent Payment Advisory Board (IPAB), which will be required to submit proposals to reduce Medicare’s spending per enrollee if the growth of such spending is projected to exceed certain targets. Those proposals would go into effect automatically unless blocked or replaced by subsequent legislative action. Verify at Page 38

 

The Centers for Medicare and Medicaid Services (CMS) estimates Medicaid enrollment will increase by about 20 million in 2019. Verify Page i

 

The expansion of Medicaid eligibility under the Affordable Care Act will broaden Medicaid’s role as part of the U.S. health care system. Verify at Page 35

 

An estimated 25 million health care Exchange enrollees (79 percent) would receive Federal government premium subsidies. Verify at Page 5

 

The total Federal cost of the national insurance coverage provisions would be about $828 billion during fiscal years 2010 through 2019. Verify at Page 2

 

The National Health Expenditure (NHE) share of gross domestic product (GDP) is projected to be 21.0 percent in 2019, compared to 20.8 percent under prior law. Verify Page 16

 

CMS estimates that for calendar years 2010 through 2019, National Health Expenditures (NHE) would increase by $311 billion, or 0.9 percent, over the updated baseline projection that was released on June 29, 2009. Year by year, the relative increases are largest in 2016, when the coverage expansions would be fully phased in (2.0 percent), and gradually decline thereafter to 1.0 percent in 2019. Verify at Page 15

 

Total net savings in 2010-2019 from Medicare provisions would offset about $575 billion of the Federal costs for the national coverage provisions. Verify at Page 21

 

Although, compared to prior law, the level of total national health expenditures (NHE) is estimated to be higher through 2019 under the PPACA, two particular provisions of the legislation would help reduce NHE growth rates after 2016Those are: productivity adjustments to most Medicare payment updates; and the excise tax on high-cost employer health plans. Such an outcome, however, would depend critically on the sustainability of both provisions. Verify at Page 17-18

 

Reductions in payment updates to health care providers, based on economy-wide productivity gains, are unlikely to be sustainable on a permanent annual basis.  If these reductions were to prove unworkable within the 10-year period 2010-2019 (as appears probable for significant numbers of hospitals, skilled nursing facilities, and home health agencies), then the actual Medicare savings from these provisions would be less than shown in this memorandum.  Similarly, the further reductions in Medicare growth rates mandated for 2015 through 2019 through the Independent Payment Advisory Board may be difficult to achieve in practice. Verify at Page 20

 

The Patient Protection and Affordable Care Act is projected to increase Medicaid expenditures by a total of $455 billion for FY 2010 through FY 2019, an increase of about 8 percent over projections of Medicaid spending without the impact of the new health care law. Almost all of this increase is projected to be paid by the Federal government ($434 billion, or about 95 percent). Verify page iiii

 

CMS anticipates that the fees and the excise tax would generally be passed through to health consumers in the form of higher drug and device prices and higher insurance premiums, with an associated increase in overall national health expenditures ranging from $2.1 billion in 2011 to $18.2 billion in 2018 and $17.8 billion in 2019. Verify at Page 17

 

For drugs covered by Medicare’s drug benefit, CBO estimated that those provisions of the legislation would raise the prices paid by pharmacies less any rebates paid to insurers by manufacturers by about 1 percent, on average. Verify at Page 66

 

That increase in prices would make federal costs for Medicare’s drug benefit and the costs faced by some beneficiaries slightly higher than they would be in the absence of those provisions, while the new discounts would make the costs faced by other beneficiaries substantially lower. Verify Page 66

 

CBO does not have a comprehensive estimate of all of the potential discretionary costs associated with PPACA, but we can provide information on the major components of such costs. Verify at Page 55

 

Click here for more details on the new health care law and the deficit/costs.

Costs/Deficit

Free Market Direct Primary Care:

Access Health Care – North Carolina

 

“We lower costs for primary care by around 85%. Getting rid of the overhead associated with billing and filing claims is a big part of that. Also, getting buy in from specialists and ancillary service providers to give patients “cash up front” discounts for paying directly can reduce many of these costs by a similar margin.

 

“We create an access point to quality health care that did not exist for patients before. People who had no insurance can now afford primary care for less than the cost of a carton of cigarettes per month. For insured patients we provide longer visits with more streamlined service since none of their visit has anything to do with what insurance they have.”

 

“We spend more time with patients – on average 3-4 times longer than a traditional practice. We utilize that time to do teaching about goals, medications, and to coordinate referrals and resources for lower costs medication.”

 

“The data shows that for blood pressure control, diabetes control, and cholesterol goals we are in the top tier percentile in the US. It also shows that every quarter we continue to get better.”

 

“We offer full scope primary care with advanced chronic disease management for about 85% less than what those service would typically cost- that’s value- especially when the clinical outcomes are superior.”

 

“For an anecdote- Several years ago a woman came to our practice for the first time- her husband had left her and dropped her health insurance the same day (and her 16 year old son’s too). She was diabetic and could not afford any insurance due to this preexisting condition. Her first year after he left, she told me she spend about $5000 on medical care. This consisted of an annual exam and 4 follow-up visits for her diabetes including blood work, office visits, an EKG, and ancillaries. She had worked about 60-80 hours per week at two retail jobs in that interim year and could still barely afford her care and medication. Then she found us. When she arrived her HGBA1C was 11.9- meaning very poorly controlled. One year later- her A1C was 6.8 (well controlled) and she had only spent about $450 for an entire year of care with us- including the annual physical, all of her follow-up visits, all of her lab work and ancillaries. As she told NPR in an interview a few years ago “We were a God send for her.”

 

“From a consumer standpoint, when you combine the direct primary care model with a high deductible wrap-around, that can still save 30-50% off of a traditional policy with all kinds of limitations. That excess money is what I use to fund a Health Savings Account while getting a much better patient experience. Health Insurance has the lowest average Net Promoter Score (industry metric for patient satisfaction). Qliance has published their score and it’s higher than Apple or Google.”

 

“On a related note, this sort of model has shown itself in vexing chronic disease populations. A reasonable sized pilot in Ohio of Medicaid diabetics has shown savings that if scaled statewide would be over $500MM per year. What state couldn’t use those kinds of savings. They did it with a combination of primary care MDs, health coaches and pharmacists.” See interview here

 

Congressional Budget Office Report on H.R. 3962 submitted by Republicans in the House of Representatives.

According to CBO and JCT’s assessment, enacting the amendment would result in a net reduction in federal budget deficits of $68 billion over the 2010–2019 period. That estimate reflects a projected net cost of $8 billion over 10 years for the provisions directly related to insurance coverage; that net cost reflects a gross cost of $61 billion that is partly offset by about $52 billion in additional revenues associated with the coverage provisions. Over the same period, the other provisions of the amendment would reduce direct spending by $49 billion and increase tax revenues by $27 billion. Verify at Page 1

 

All told, the amendment would reduce the federal deficit by $18 billion in 2019, CBO and JCT estimate. As a rough approximation, CBO assumes that the effect of the proposal on budget deficits would grow at roughly the rate of health care spending during the following decade. Consequently, CBO expects that the legislation would slightly reduce federal budget deficits in that decade relative to those projected under current law—with a total effect during that decade that is in a broad range between zero and one-quarter percent of gross domestic product. Verify at Page 7

 

The figures presented here do not represent a comprehensive cost estimate for the amendment. Nevertheless, the estimates reflect the major net budgetary effects of the proposal. Verify at Page 2


 

 

Premiums

 

In the small group market, which is defined as consisting of employers with 50 or fewer workers, Congressional Budget Office (CBO) and Joint Committee on Taxation (JCT) estimate that the change in the average premium per person resulting from the new health care law could range from an increase of 1 percent to a reduction of 2 percent in 2016. Verify here

 

The average, unsubsidized premium per person covered (including dependents) for new nongroup (individual market) policies would be about 10 percent to 13 percent higher in 2016 than the average premium for nongroup coverage in that same year under current law. Verify here

 

More than half of the enrollees in nongroup policies would get federal subsidies, and taking those subsidies into account, the amount that subsidized enrollees would pay for nongroup coverage would be roughly 56 percent to 59 percent lower, on average, than the nongroup premiums.

 

In the large group market, which is defined as consisting of employers with more than 50 workers, the PPACA would yield an average premium per person that is zero to 3 percent lower in 2016 (relative to prior law). Verify here

 

For the estimated 23 million people who would remain uninsured in 2019, roughly 5 million are undocumented aliens who would be ineligible for Medicaid or the Exchange coverage subsidies under the health reform legislation. Verify at Page 8

Click here for more details on the new health care law and premiums.

 

Premiums

 

Congressional Budget Office Report on H.R. 3962 submitted by Republicans in the House of Representatives.

 

In the small group market, which represents about 15 percent of total private premiums, the amendment would lower average insurance premiums in 2016 by an estimated 7 percent to 10 percent compared with amounts under current law. Verify at Page 4

In the market for individually purchased insurance, which represents a little more than 5 percent of total private premiums, the amendment would lower average insurance premiums in 2016 by an estimated 5 percent to 8 percent compared with amounts under current law. Verify at Page 4-5

The large group market, which represents nearly 80 percent of total private premiums, the amendment would lower average insurance premiums in 2016 by zero to 3 percent compared with amounts under current law, according to CBO’s estimates.

 

 

High Risk/Caps/Young Adults

 

To be added

 

 

 

 

 

 

 

 

 

High Risk/Caps/Young Adults

 

To be added