Category Archives: Healthcare/Insurance

Is Paying the Obamacare Tax a Better Choice for the Young and Healthy?

Posted on September 29, 2013 | 2 comments

Urgent Update and Correction:

Just as with this article at Business Insider, I missed the fact that enrollment in the exchanges is limited to open enrollment periods.

This does change the risk dynamics of paying the tax rather than buying the insurance.  Any confusion caused by this oversight is regretted.  Even still, those with either few assets to lose or those with sufficient assets to carry them to the next enrollment period, may still want to take the risks as presented in the original post.  The availability of sensible catastrophic true high deductible “real” insurance that Obamacare prohibits and has not been offered in the states would be the answer to this dilemma.

Original Post (with slight unrelated edits):

The following discussion is in no way intended as specific advice as everyone’s situation is different and unique to them, but only as a guide to uninsured young and healthy individuals to understand their choice in whether to buy health insurance on an Obamacare exchange to avoid paying the tax or paying the tax to relieve them of the obligation to purchase the insurance.  The only mandate for the uninsured is to make this choice, not to do one or the other.

The other purpose here is to counter biased government efforts that will insist the only choice is which insurance exchange plan to buy and how to sign up for it, ignoring the possible benefit of paying the tax instead.  This government effort is substantial, as here in Pennsylvania alone, over $6 million of taxpayer money is being directed to one critical thing Obamacare success is dependent on, enrolling as many young and healthy people as possible.  According to Enroll America-Pennsylvania, on July 10, 2013 “health centers in Pennsylvania were awarded a total of $4,196,333 to provide outreach and enrollment assistance.”  They also indicate that an additional $2,071,458 is coming soon to organizations that will act as “Navigators” who will likely never discuss the non-insurance option that is also important for the young and healthy to understand in making their choice.

Young people need to know a few facts of Obamacare at the outset.  Because the law limits charging the old and less healthy more than three times what the young and healthy pay, this shifts more burden to the young.  Offsetting this are premium subsidies to make the insurance choices seem affordable, but as the young advance their careers and their earnings these subsidies fade.  Another important consideration is that shortsighted bureaucrats designed Obamacare to allow no exclusion for previously existing conditions, giving the opportunity to purchase insurance after the onset of a serious illness, even from a hospital bed. Update: Still true, but only if during a subsequent open enrollment period.

The pay-the-tax choice may be useful for young and healthy people who have the discipline to put aside the difference (compared to paying exchange premiums) for their basic normal medical needs, and especially if they then find one of a growing number of physicians offering much lower prices by casting off third party payment for a cash practice.  It must be understood that this choice is not without the risk of an occurrence of a sudden and severe medical condition causing total incapacitation.  This extremely rare event could prevent them from signing up for insurance on an exchange until they are sufficiently recovered to do so.  Update: So long as it is within or until the next open enrollment period.

Putting the sudden-and-severe risk in perspective though is important.  Everyday young healthy people take on huge amounts of student loan debt, with no guarantee of acquiring a job sufficient to easily pay it back, even as student loan debt obligations saddle the borrower for life because  they are not dischargeable in bankruptcy.  Medical debts, on the other hand, can be eliminated through bankruptcy should the highly unlikely occur.  This is where an option to pay the tax and buy a very low cost non-Obamacare compliant policy that pays nothing up to perhaps a $10,000 or even $15,000 deductible, then covers everything above that, would be so useful, but no such thing exists.  Such a plan would be good enough to prevent bankruptcy in most cases and leave substantially less obligation than many young people have willingly taken on with student loans.

It is thus important for young healthy people to see the big picture, understand all their options, then act in their best interest, in reaction to the rules presented to them by the Affordable Care Act.  This discussion has been meant as a guide in starting the navigation of that process.  Additionally, there is a wonderful new resource blog, The Self -Pay Patient, that unfolds a myriad of already available but little known alternatives to insurance, and I highly suggest a visit for anyone serious about learning the many other options available to them, since no government navigator will ever mention any of it.

Note: This post was shared to WatchdogWire

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REINS Revolution as Ransom for Budget Resolution?

Posted on September 7, 2013 | Leave a comment

REINS

Herd mentality on issues is not something unique to the political Left or the political Right, but in either case populist tendencies can be downright dangerous, leading to unintended consequences.  No matter how good an idea seems at the outset, it is always good to ask what could go wrong.  Zealotry interferes with this basic question and places pressure on those who may doubt the wisdom of an idea, risking indignation from those they consider allies,  to remain silent.  Principled people will resist this temptation to go along to get along, making known their objections, explaining why, then letting the chips fall where they may.

We currently see herd movement on the Conservative side, with the attempt to defund Obamacare by making it ransom for cooperation in passage of a continuing budget resolution in order to keep the Federal government functioning past September 30.  Looking around, there appears to be unanimity among the grassroots on this issue.  Freedom Works, Heritage Action, Tea Party Patriots are all on board, being led by Senators Ted Cruz and Mike Lee among others.  Ads on Hannity and Rush and the Blaze are all promoting defund.  A rally at the capitol has been planned for September 10 and busloads of protestors will be making the trek.  “Exempt America from Obamacare” is the cry.  Yet there are a small handful of dissenters, myself among them, warning of the potential foolishness of this approach.

Jennifer Stefano, head of the Pennsylvania chapter of Americans for Prosperity, minced no words in her August 9 op-ed for the Patriot-News and Pennlive.com.  She boldly said that those “pushing the ‘defund Obamacare or shut down the government’ fight are wrong.  One hundred and ten percent wrong” and to conservatives, “your government shutdown approach has got to stop.”

Following that, on August 14 Avik Roy of the Manhattan Institute, and one of the foremost opponents of Obamacare and defenders of market based healthcare reform solutions, published an op-ed in National Review Online.  Wasting not a second, his title read, “Obamacare’s Shutdown Shock-Jocks  Ted Cruz and Mike Lee have a plan-to make Obamacare permanent.”

Neither Stefano nor Roy suggest anything that might confound the atrocity of Obamacare is a bad idea.  Both do suggest, however, that tying defunding to the budget resolution has the potential to backfire big time.  They both point to polls showing little public support for shutting down the government.  Supporters try to say that it would be Democrats and Obama shutting down the government, not them.  Obama and the Left, of course, along with a complicit media, will rail against the Republicans and Conservatives in particular.  With the current political realities, a festering shutdown deadlock in the face of unfavorable polls would be  the likely outcome.  The implications of this would then likely carry a price, perhaps a heavy one, going into 2014.

So back to political leverage in connection with allowing the federal government to continue operating past the end of September: There is one thing on which conservatives could only win.  Tie any budget cooperation to passage of the REINS Act.  The what?  Exactly!  Use it as ransom for cooperation.  There are no illusions REINS would actually pass, and backing away short of a government shutdown would be necessary, but after weeks in the spotlight, everyone who pays even a small amount of attention to politics would have a good understanding of a brilliant concept, of which too many conservatives are still unaware.  That alone could be a huge victory.

Briefly, the REINS Act would put limits on an out of control trend toward legislation by regulation (or regulation as legislation), whereby departments and agencies can make things up as they go, despite the economic impact on those who must comply.  Under REINS any regulation with implementation impacts greater than $100million (including Obamacare) would require the consent (and accountability) of Congress.  This puts REINS in a very special class of ideas that seek to step away from an overly powerful central government, rather than stepping further into it!  In that respect it is a revolutionary tool of disengagement from bloated central authority.  Promoting such a concept, showcasing the REINS Act, would define and position the GOP going into 2014 as the party of limited central government in a way that may force a discussion the Left would rather not have or expect.  Contrast this approach with the risks of tying defunding Obamacare to the continuing resolution, especially when defund or delay can still be pursued (and should be) via general orders apart from any budget resolution.

Additionally, the Obamacare mess has been speaking badly for itself lately, to the extent that, along with parts that have already been delayed, even Democrats and disenchanted labor unions may find total delay palatable before long.  Avik Roy pointed out, because defund, even if possible, would extend only one year or the length of any budget resolution, it and delay are really the same.

A wonderful description and  history of REINS, followed by examples of federal government excesses that demand it, can be found in Phil Kerpen’s 2011 book Democracy Denied.

Originally introduced in the 112th Congress, REINS has been reintroduced in the current Congress as HR 367.  It passed the House on August 2, 2013 by a 232-183 vote.

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Posted in Healthcare/Insurance, Politics, Tools of Disengagement

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The Insidious Non-Optional Medicaid Expansion That Further Clouds the Future for States

Posted on March 4, 2013 | 1 comment

So much about Obamacare has been “by any means necessary”, from the legislative gymnastics to get the bill through Congress to the current mandatory expansion of Medicaid that is here now even though largely unnoticed.  Here now?  But wasn’t Medicaid expansion optional?  Some yes and some no as it turns out.  This almost unknown stealth expansion was required of the states and imposed on them despite the Supreme Court ruling because it is being funded 100% by the Federal Government, but only for two years 2013 and 2014, after which, funding abruptly ends.  Because a strong constituency is being created (or bought) that will demand this expansion be continued past 2014, and no one can predict the outcome of those likely demands, further possible complications and risks arise for those states that decide to embrace the optional Medicaid expansion.  Allow me to explain.

Because of current constraints to participation by medical professionals both by low reimbursement rates, 1800+ pages of cumbersome rules, and audits that go beyond financial fraud to interfere in actual treatment decisions, there are at present not enough willing doctors to adequately serve those now eligible for Medicaid benefits.  Realizing this, and attempting to avoid making the optional expansion to 133% of poverty and influx of new eligibles a disaster, “any means necessary” was once again deployed.

On November 6, 2012 (surprisingly not a Friday) CMS published a Final Rule to go forward.  146 primary care Medicaid services identified by the ACA would, by regulatory proclamation, be compensated at the higher Medicare rate, starting with 2013 but only for two years.  Since Medicaid reimbursement rates relative to Medicare reimbursements vary tremendously from state to state, the percentage increase covered by Federal funding varies accordingly.  At one extreme are two states that surprisingly pay higher Medicaid fees for the covered services than they do for Medicare.  These states will receive no additional Federal funding.  At the other extreme is Rhode Island, where Medicaid fees will increase 198%.  Five other states will receive boosts of over 100%.  Pennsylvania is number seven on the list and doctors will be compensated an additional 96% to equal the higher Medicare rates.  On average across the nation Medicaid fees for the ACA primary care services will rise 73% at an estimated cost of $11.9 billion, all in an attempt to keep willing physicians on board, expand their willingness, and attract newcomers.

The problem, of course is what happens after 2014.  It is unimaginable that doctors enjoying the higher reimbursements for two years will do anything but lobby stridently to extend the increases and indeed have them made permanent.  Realizing, otherwise, the carrot to participation would no longer exist, this outcome can be considered probable.  The mystery is who would then pay?  Would the increase be included in the ultimate 10% state funding under optional expansion to 133% of poverty or even some formula that would require states to pay more? Would the increases fall to each individual state or be averaged over all the states?  The point is that today no one knows.  While perhaps not being the main reason to avoid the optional Medicaid expansion, especially those states with the greatest percentage “temporary” increases need to consider the possibility of very serious consequences in the aftermath of this two year attempt by the Federal government to buy a loyal constituency for implementation and avoidance of massive failure.  It is also interesting that the current reimbursement increases were only applied for two years, as estimates for the cost of Obamacare have been made over a ten year period, allowing more, for now, to remain hidden from view.

The two main sources used for this post were a policy brief from the Henry J. Kaiser Family Foundation and an article in American Medical News published by the American Medical Association.  More details can be found at these two locations.  Also used was a recent article written by the President of the Texas Medical Association.

Note: This post was shared to WatchdogWire-Pennsylvania on Sep 24, 2013.

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Posted in Healthcare/Insurance, National Politics, PA Politics, Pennsylvania, Politics

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Every State Not Expanding Medicaid (and those that do) Needs to Do THIS — ASAP!

Posted on February 26, 2013 | 3 comments

Pennsylvania is fortunate to have a governor who has made bold choices in opposition to Obamacare by both declining state insurance exchanges and the more difficult, but entirely correct, refusal to expand Medicaid, but it can’t stop there.  Governor Corbett and all non-expansion states need to explain why their decision was correct and promote alternative solutions asap, or lose the battle for public perception as Democrats are painting the Governor and the GOP as standing against the poor and caring only about the rich, despite it not being true.

Last week on PCN-TV, a Pennsylvania version of C-span,  State Senator Vincent Hughs was practicing his art of indignation by trashing the Governor on Medicaid expansion and demanding to see the figures on Governor Corbett’s fiscal concerns.  He also posted a response on his website.  Senator Hughes seems to have the idea that adding more free stuff from others better off can never go wrong, and because we would in the end retain 90% Federal funding, that Federal money somehow materializes from thin air, rather than from the pockets of people in the states, including Pennsylvanians.

For the benefit of Senator Hughes, and to his credit, we should look at numbers, and outcomes and realities as well, being sure to consider everything we know and leaving indignation, hubris, and emotion at the door.  If Senator Hughes would approach the debate in such fashion and the GOP would learn to articulate their message and promote detailed solutions and alternatives to Medicaid expansion we may find places where we can agree, and even discover ways to provide better care for the poor at less cost to the taxpayer.

Without too much detail, Medicaid is a mess.  Low reimbursement rates that don’t cover costs keep many physicians from participation entirely and must limit the number of eligible patients seen for those who do.  For others a different cost is too great, best summed up in this quote from an article written by the President of the Texas Medical Association, Dr. Michael E Speer :

“Texas physicians are also discouraged from accepting new Medicaid patients because of the program’s 1,802-page rulebook and exasperating, irreconcilable red tape. We need to return to treating the patient, not the administering bureaucrat.”

These constraints to participation create rationing by waiting time, length of visits, and lack of availability to care that result in the much higher cost of seeing non-emergency cases at hospital emergency rooms.  After all it’s better to wait 6 hours to see someone than 6 days or 6 weeks, and those facing such choices cannot be blamed for doing what they perceive is in their best interest.

All this has numbers attached too that Senator Hughes and those deriding the Governor’s decision should be equally interested in seeing as well.  Ask any doctor.  Medicaid patients often fare worse than patients without any insurance.  Expansion of eligibility will do nothing but increase the waiting times of those already attempting to find access from too few professionals who can afford to offer it.  Coverage clearly does not equate to care.  Also, expansion to 133% of poverty forces more people into Medicaid because only  those over 133% will be eligible for subsidies in exchanges.  Many additional people toward the upper end of the 133% will be be forced to drop private insurance they now have to join the ranks of the current overextended Medicaid mess.  Senator Hughes and others, is this what YOU want?

We must look to better ways to provide for our poor, not extend a system of failure.  Various alternatives to providing for the poor have been tried, some with much success and satisfaction.  Successful innovations have been tried in Indiana, Florida, and Rhode Island.  These involve empowering the poor with ownership via their own special accounts or insurance policies that have incentives to choose services wisely.

Perhaps the single best idea I’ve seen comes as a bill that has been introduced in the New Jersey Senate that uniquely looks at a partnership between state government and private charity.  Senate No. 2231, also known as the “Volunteer Medical Professional Health Care Act”, is a brilliant idea that should cross party and partisan lines with appeal to anyone who seriously wants to provide better access at lower cost along with less government involvement and control.

Very simply, New Jersey Senate No. 2231 would grant any physician (primary care or specialist) or any dentist who agrees to volunteer at least 4 hrs per week in a non-government free clinic, immunity from civil liability through the entirety of their medical or dental practice in the state.  These physicians would not need to purchase malpractice insurance and be freed from oppressive Medicaid regulations and scrutiny, creating an almost irresistible incentive for many more physicians to participate than are willing to commit to Medicaid.  Medicaid would never be involved or ever billed for any of this service.  The New Jersey chapter of the Association of American Physicians and Surgeons (AAPS), who inspired the legislation has estimated New Jersey could expect to save $2 billion of a $10.2 billion Medicaid budget or close to 20%, while offering more timely and much better care for those they see.   AAPS itself was inspired by the vision of two members, Drs. Alieta and John Eck, who responded to the needs of the poor and their concerns over the pitfalls of Medicaid by starting a free clinic in their hometown, Zarephath, NJ,  in September of 2003, thus will enjoy their 10th anniversary this year.

Governor Corbett in Pennsylvania and other Governors who courageously declined to expand Medicaid made the right choice and need to stick to it.  Opponents need to open their eyes to existing realities, and all need to come together to find better solutions such as S-2231 in New Jersey as well as others.  AAPS has informed me that similar legislation may soon be introduced in UT and AZ.  It is not enough to decline Medicaid expansion and then do nothing, while being falsely painted as uncaring by those with insufficient understanding.

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Posted in Healthcare/Insurance, National Politics, PA Politics

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Resisting Obamacare and Confronting the Dangerous “Other” Complicity – There IS a Way Out

Posted on December 10, 2012 | 10 comments

With the deadline for states to convey their intentions on Obamacare exchanges to HHS only days away at this writing, much attention is centered on what they will do.  It is possible that half the states will decline to participate leaving the Feds alone in a task some think may not go well.  The point that the States have the option of participation cannot be lost.  The crafters of Obamacare were in some ways cognizant of the limits of Federal power and, thereby, sometimes reliant on willful submission and complicity to achieve their goals.  In the past few weeks I’ve discovered that exchanges were not the only situation where Obamacare recognizes its potential limitations vis-a-vis the states, opening the door to the potential for significant new legal non compliance options.

On November 29 I received an email from Donna Rovito, fellow Pennsylvanian, National leader in  healthcare freedom issues, and founder of the Lehigh Valley Coalition on Healthcare Reform.  It included a link to a Citizens’ Council for Health Freedom (CCHF) page featuring commentary from its president Twila Brase.  Her topic was a section of Obamacare that drew notice of at least one attorney at the Goldwater Institute.  It’s found in Subtitle G – Miscellaneous Provisions, specifically Section 1555 which reads:

“No individual, company, business, nonprofit entity, or health insurance issuer offering group or individual health insurance coverage shall be required to participate in any Federal health insurance program created under this Act (or any amendments made by this Act), or in any Federal health insurance program expanded by this Act (or any such amendment), and there shall be no penalty or fine imposed upon any such issuer for choosing not to participate in such programs.”

The question raised was whether Section 1555 leaves individuals the right to opt out of Obamacare or is restricted to issuers of insurance, accepted as understood.  I hope to show why this distinction is of minor concern.

Only a few more pieces of this puzzle need to be considered to understand its importance, mostly falling under the heading of what I’ve been calling the “other” complicity.

The other complicity is the unchallenged acceptance of Obamacare coverage mandates and regulations into policies as they even now exist before the exchanges are set to begin.  This would include everything that defines how health insurance must look, from the phony deceptive “no cost sharing” first dollar mandates (including “free” contraception) to the age 26 requirement and bans on exclusion of preexisting conditions, from minimum loss ratio requirements to actuarial value restrictions and more.  All this defining by the feds is in a direction 180 degrees from anything that makes sense and will add hugely to health insurance premiums within the exchanges.  Michael Cannon at the blog Cato @ Liberty just presented some stunning information on the magnitude of these premium increases.  We are looking at 30-40% and in some cases more.

While the Federal Government may be able to define the parameters of insurance within Obamacare there still exists a world outside, separate and apart, or at least there can and should.  That world is the authority and responsibility of the states to regulate insurance sold within its borders granted to it by the McCarran-Ferguson Act of 1945.  Under McCarran-Ferguson insurance was exempted from Federal anti-trust law and its regulation was left to the states, and remains in effect to this day.  There is nothing about Obamacare that strips states of this right and insurance companies cannot claim that they are bound to participate in the dictates of Obamacare, as Subtitle G-Section 1555 makes clear they are not.  Insurance companies were given the choice to partcipate, but states, through their insurance departments, and the authority of McCarran-Ferguson, reserve the right to require the continuance of non Obamacare compliant health insurance outside the exchanges, no matter what form the exchanges take.  So long as states do NOT go for the purchase of health insurance across state lines, they have the defense, even in the face of the modern skewed interpretation of the Commerce Clause, to keep it this way.  States must see Obamacare not as an imposition upon them but as a federal program layered over them for those who want it.  They hold the keys to the maintainance of the availability of sensible health insurance policies, outside the federal program, firmly in their hands.

States, by using the authority they have, can even require a movement to true high deductible insurance where everything covered conforms to the deductible, among its choices outside Obamacare, thus setting the stage for many to pay the tax for non participation in the exchange, purchase sensible real insurance outside it, stash money into a HSA, and still have money left over in the end.

My take is that Obamacare is so reliant on willful complicity as to be a paper tiger that only gets teeth that are handed to it.  All of the above along with the adoption of Healthcare Freedom measures as 17 states so far have, will determine how far states will permit the federal power grab that is Obamacare to go.  A tradition of states exerting those powers they have needs to be rekindled, and there is no better time than now, on this issue, to do it.

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Posted in Healthcare/Insurance, Politics, States Rights

I Want to be Thankful for My Governor – An Open Letter to Tom Corbett of Pennsylvania

Posted on November 20, 2012 | Leave a comment

Honorable Tom Corbett, PA Governor

Governor Corbett, this holiday season I want to be especially thankful for my governor.  Governors are uniquely positioned to defend and protect a prime reason why America has thrived as it has.  The concept that in the United States a predominance of power would remain with the States and the People was central to our founding.  Violations of this concept are yours to resist and defend your state’s citizens against.  The notion of state and individual sovereignty in America must be fought for under any circumstances forever.

We currently stand at a point of decision.  Obamacare is upon us.  When I called your office and raised these Constitutional and Founding issues your staff agreed in theory, but then went straight to a strange position of passivity, an acceptance that Obamacare is inevitable.  I was even told that “come 2014 Pennsylvania will have an exchange”.  Governor Corbett this is not the kind of leadership I am looking for.  Yes, how setting up Obamacare exchanges will affect the finances of the state is an important consideration, but overriding that is Obamacare’s assault on freedom.  As Attorney General you brought PA into suits against this Federal power grab.  Where will you be now with things you still can do to protect us?

In the last few days two highly instructive articles have appeared on why states should refuse to set up exchanges.  One comes from Michael Cannon at the Cato Institute.  Another, written by James Capretta and Yuval Levin appeared in the Wall Street Journal.  Both suggest that the 30 Republican governors can gum up the works of Obamacare by simple legal acts of non-complicity.  Neither suggests any advantage for states or their citizens by setting up exchanges even if they ultimately become a reality.  Questions remain if the law itself provides the framework to be implemented without the cooperation of the states.  Almost 35 lawsuits remain to be decided.

Governor Corbett, the Federal Government has extended the deadline for states to make their decisions on exchanges and Medicaid expansion to December 14.  Twenty-one other states, so far,  have said they will not be setting up exchanges.  A majority of states standing in opposition is very possible.  According to the two articles I cited sufficient disruption may ensue to at least delay Obamacare if not cripple it.  Development of and having at hand alternative market based reforms, such as those suggested in other posts on this blog, may then find an opportunity to at least be demonstrated.

Governor Corbett, this is a time that requires exceptional courage.  By taking the side of freedom and liberty, on December 15 I will be able to say that I am especially thankful that you are my Governor.  Say NO to Obamacare Exchanges and the expansion of Medicaid also.  Thank You!

Happy Thanksgiving Sir

Todd Keefer

PA citizen and writer of FreeMktMonkey.com

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Posted in Healthcare/Insurance, Open Letters, PA Politics