Friday, May 27, 2016

qotd: Aetna and Anthem shareholders condone secrecy of dark money contributions

Modern Healthcare
May 26, 2016
Shareholders vote down dark money disclosure at Aetna, Anthem
By Bob Herman

Health insurers Aetna and Anthem won't have to tell shareholders how much money they send to tax-exempt political organizations, at least for another year.

Shareholder resolutions that would've required Aetna and Anthem to disclose how much they spend on 501(c)(4) "social welfare" organizations and other business association groups failed to gain approval last week at the companies' respective annual shareholders meetings. Approximately 91% of Anthem investors rejected the proposal, and 75% of the votes were cast against Aetna's resolution.

Political not-for-profit organizations, also called dark money groups, do not have to reveal their donors, and they can receive unlimited amounts of money, much of which is routed toward influencing elections.


Comment by Don McCanne

The shareholders of Aetna and Anthem, by voting down disclosure of dark money contributions, are co-conspirators with the corporate executives in the efforts to prevent transparency of their financial contributions to dark money organizations that use their funds to influence elections.

Once we replace the private insurers with a publicly-owned Medicare for all program, we need show no special sympathy for the displaced insurance executives, and that goes for their rent-seeking shareholders as well. Our sympathies should be directed to the displaced employees of the insurance corporations who will need assistance in job training and in creating new employment opportunities.

Thursday, May 26, 2016

qotd: Progress in covering low- and moderate-income populations falters

The Commonwealth Fund
May 25, 2016
Americans' Experiences with ACA Marketplace and Medicaid Coverage: Access to Care and Satisfaction
By Sara R. Collins, Munira Gunja, Michelle M. Doty, Sophie Beutel


The fourth wave of the Commonwealth Fund Affordable Care Act Tracking Survey, February–April 2016, finds at the close of the third open enrollment period that the working-age adult uninsured rate stands at 12.7 percent, statistically unchanged from 2015 but significantly lower than 2014 and 2013. Uninsured rates in the past three years have fallen most steeply for low-income adults though remain higher compared to wealthier adults. ACA marketplace and Medicaid coverage is helping to end long bouts without insurance, bridge gaps when employer insurance is lost, and improve access to health care. Sixty-one percent of enrollees who had used their insurance to get care said they would not have been able to afford or access it prior to enrolling. Doctor availability and appointment wait times are similar to those reported by insured Americans overall. Majorities with marketplace or Medicaid coverage continue to be satisfied with their insurance.

Exhibit 2:  Uninsured Rates Among Low-Income Adults Have Fallen the Most But Remain Substantially Higher Than Those For Adults with Higher Incomes

People with low and moderate incomes — the population targeted in particular by the ACA's reforms — had the highest uninsured rates prior to the law's enactment and subsequently have experienced the greatest gains in coverage by far. But after declining steeply in 2014, uninsured rates for adults with incomes below 138 percent of the federal poverty level ($16,243 for an individual and $33,465 for a family of four) have remained about the same. Similarly, uninsured rates for those with incomes between 138 percent and 249 percent of poverty ($29,425 for an individual and $60,625 for a family of four) had fallen by half by 2015 but remain nearly the same this year. Consequently, low- and moderate-income adults are uninsured at rates as much as 10 times higher as those for adults with higher incomes.

Conclusion and Policy Implications

After falling sharply in 2014 upon rollout of the ACA's major coverage expansions, the uninsured rate for U.S. working-age adults has been declining at a slower pace. The chasm in insurance coverage between lower- and higher-income adults remains troubling. We will explore the possible reasons for this in a forthcoming brief.

In each year since the coverage expansions, our survey findings have indicated that overall enrollment has been propelled by people who were previously uninsured — a year or longer for the vast majority. Consistent with other national surveys and Congressional Budget Office analyses, enrollment has not been driven by people shifting out of employer coverage: the share of adults insured through an employer has declined only slightly since 2013. The survey findings do suggest that for people who lose their job-based health benefits, the expanded insurance options may be helping to bridge the coverage gap.


Comment by Don McCanne

The Affordable Care Act (ACA) has been effective in reducing the numbers of uninsured, particularly amongst low-income adults. Although that is good news, we should be alarmed that "low- and moderate-income adults are uninsured at rates as much as 10 times higher as those for adults with higher incomes," and that there has been little improvement in enrollment for these lower income levels since the initial steep decline in 2014.

When ACA was constructed, it was decided that the employer-sponsored plans should be left largely alone to continue to fulfill the role of covering the majority of middle- and higher-income individuals and families. The greatest need was for the uninsured low-income and uninsured moderate-income sectors of the population. Thus two of the more important design features of ACA were to expand Medicaid for low-income individuals and to offer income-indexed tax credits and subsidies for private plans offered through the ACA exchanges (Marketplace).

How successful has the plan to cover those with greater financial needs been? As stated, uninsurance for those with low and moderate incomes has stabilized at a rate 10 times higher than those with higher incomes. Except for an initial surge, ACA has failed to achieve the goal of covering these more vulnerable populations.

They would have all been covered under a single payer system. Not only that, the ACA model of reform is the most expensive model of all, yet falls miserably short in universality, efficiency and equity. The least expensive comprehensive models of reform that would have actually achieved these goals are single payer Medicare for all or a government owned and operated national health service.

Although "socialism" has become less of a pejorative in the United States, the majority of residents would prefer the social insurance model of Medicare for all rather than socialized medicine through a national health service model. Now that ACA has been demonstrated to be an over-priced failure, we should move on with establishing an Improved Medicare for All.

Wednesday, May 25, 2016

qotd: Working families of four now average over $25, 000 for health care

May 24, 2016

Milliman Medical Index: Healthcare costs for a typical American family will exceed $25,000 in 2016 and have tripled since 2001

Healthcare costs reach $25,826 for the typical American family of four, compared to $8,414 in 2001.

Milliman, Inc., a premier global consulting and actuarial firm, today released the 2016 Milliman Medical Index (MMI), which measures the cost of healthcare for a typical American family of four receiving coverage from an employer-sponsored preferred provider plan (PPO). In 2016, costs for this family will increase by 4.7% — the lowest rate of increase in the history of this study — though the total dollar increase of $1,155 marks the 11th consecutive year that the total dollar increase has exceeded $1,100. The employer pays $14,793 of the total healthcare costs and the employee — through payroll deductions and cost sharing at the time of service — pays $11,033.


2016 Milliman Medical Index

In 2016, the cost of healthcare for a typical American family of four covered by an average employer-sponsored preferred provider organization (PPO) plan is $25,826, according to the Milliman Medical Index (MMI).

Milliman Medical Index is an actuarial analysis of the projected total cost of healthcare for a hypothetical family of four covered by an employer-sponsored preferred provider organization (PPO) plan. Unlike many other healthcare cost reports, the MMI measures the total cost of healthcare benefits, not just the employer's share of the costs, and not just premiums. The MMI only includes healthcare costs. It does not include health plan administrative expenses or profit loads.

Key findings of the 2016 MMI include:

1. Our lowest annual increase in 15 years still pushes the MMI over $25,000. The cost of care for the typical American family of four has more than tripled since its value of $8,414 in 2001. And the current level of $25,826 is just an average. Healthcare spending for any given family can range from $0 into the millions of dollars.

2. The percentage increase in the MMI is at its lowest rate ever. However, even at 4.7%, which is the lowest annual increase since we first measured the MMI in 2001, the rate of increase is still well above growth in the consumer price index (CPI) for medical services, and far surpasses the average 2% annual increase in median household income between 2004 and 2014. More than ever before, health insurance is a critical component of a family's financial security, and yet it continues to become less and less affordable.

3. Employee expenses increase at rates higher than total healthcare spending. At $11,033, the employee's total cost increased by 5.3% from 2015, while the employer's cost increased 4.2%. In fact, only once in the past 10 years have employee costs increased at a lower rate than employer costs. Back in 2001, the first year we measured the MMI, employers paid 61% of costs while employees paid 39%. In 2016, the same split is 57% and 43%. Employees are shouldering more of the healthcare cost burden than they were 15 years ago.

4. Prescription drugs, the most rapidly growing MMI component, are nearly 17% of total healthcare spend. In 2016, the MMI family's prescription drug costs will reach $4,270. That's almost four times as much as the $1,111 in prescription drug expenditures the family had in 2001. Prescription drug expenses grew at 9.1% from 2015 to 2016, a lower rate than last year's 13.6% increase.


Comment by Don McCanne

The Milliman Medical Index (MMI) is the cost of health care for a typical American family of four covered by an average employer-sponsored preferred provider organization (PPO) plan. It is now over $25,000 ($25,826).

Although the annual percentage increase in the MMI has been declining - this year down to 4.7% - the dollar increase has exceeded $1,100 for each of the last 11 years. Though some of that is paid by forgone wage increases, that is quite a bite to being taking each year out of the wages for a typical worker's family of four.

Nor should the declining rate of increase in the MMI be celebrated as a success of the Affordable Care Act. It is in excess of four times the rate in the increase in the CPI over the last 12 months (1.1%). Families on the average are ending up further and further behind because of the increases in our health care costs.