What effect – the repeal of the individual mandate?
- Wednesday, 27 December 2017 11:23
The new Tax Bill repeals the individual mandate – in 2019. Not this year, mind you, you are still required to have insurance this year. So what affect will this have on ObamaCare going forward?
If you listen to the politicians, Bill Pascrell (D.NJ) said “They obviously couldn’t kill it so they’re trying to starve it to death slowly.” Lindsey Graham (R.SC) said “…we ripped the heart out of ObamaCare…” I think both are a bit off base, and here is why- Despite all kind of claims to the contrary, in my experience with clients, the mandate was not a big modifier of behavior. Do I have some clients that pay premiums to avoid the penalty? A few, yes – but not many. Far more simply said ” I can pay $400- or more- a month for insurance, or pay a penalty a year from now that is far less. If you make $50,000 a year your penalty is $1000; insurance for that time period could cost you $6000 or more.
Another great number is the Congressional Budget Office claim that the loss of the mandate will cause 13 million fewer people to be covered over the next ten years. Considering there are fewer than 10 million under ObamaCare, This trend analysis always seems a bit faulty. Especially in light of the CBO’s estimates in 2012 that 25 million would currently be covered.
Some of the recent modifications may, in the end, have a much greater affect on policyholders. here are some of the less-understood changes:
- Cost-sharing subsidies- Trump “de-funded” these. When someone who earns less than 250% of the Federal Poverty Level (about $30,150) takes a Silver plan, their deductibles and other expenses are lower than someone who earns more than that amount. This makes the insurance more affordable on a day-to-day basis. for 2018, because the insurance companies followed the law and got their policies approved in this manner, they have to honor the lower amounts- but the government isn’t reimbursing the insurance company for those amounts now. Many carriers saw this coming, and raised their rates accordingly for this year – one reason why rates are so much higher again this year.
- Shortened Enrollment and less marketing- The Trump administration cut the enrollment period and sharply dropped the marketing budget for this year. While enrollment is done, I still have this week several people who just figured out that they missed it for this year!
- “Skinny” Health Plans – This may turn out to be the most destabilizing force. In October, an executive order allows both association plans and Short-term major medical plans to not meet the ObamaCare rules. Under the Obama Administration, Short Term plans had been limited to 90 days. Plans like MediShare and US Health Advisors are already gaining traction as people stare in horror at their renewal premium, and these new plans may attract a lot of the younger and healthier folks – adversely putting the sicker into “regular” plans, and driving costs up even further.
One thing is for sure – with the changes the Republicans have made, after two years of “repeal and replace” noise – the Republicans now own as much of ObamaCare as the original Architects. I fully expect that to be used against them in the coming midterm election season.
Changes to ObamaCare made by President
- Friday, 13 October 2017 06:32
In the last 24 hours, President Trump has signed executive orders changing a number of things about “ObamaCare” – some which will popular, and others which won’t… depending on who you are. This is not a political conversation, at least not on my blog.
The first change is to allow Associations and business organizations to offer insurance through their organizations again. When I first started in this industry this was common, but that turned with NY’s change to “Community Rated Plans” in 1993 under Governor Cuomo. This will most likely be coupled with “the ability to sell across state lines.” It is an intriguing idea fraught with many technical issues.
In theory it would allow plans that don’t meet the “minimum essential benefit” rules – which if you are a 25 year old male not needing maternity coverage is a good thing for your rates. Of course if you need a benefit down the line that you did not buy you would have to change plans.
It also allows Short Term Medical Plans to expand – the Federal Government under President Obama eliminated these plans for any time frame more than 90 days.
NOTHING in the executive orders has any affect on pre-existing conditions, although there has been much speculation in social media about that.
More troubling is the removal of subsidies for “low-income people.” It is unclear based on what I have been able to read this morning exactly what that means, typical for politics. Does this mean the Medicaid expansion is unfunded? It appears to target only the “cost-sharing payments” that lower deductibles and costs for those under 250% of the Federal Poverty level, but does it also affect all subsidies? Not clear.
SUMMARY- Executive orders have no force of law. The Affordable Care Act (ObamaCare) is the law of the land. The association, and across state lines pieces, will probably take a year or more to have any affect. It is likely that there will be a series of court appearances designed to stop the Trump administration from eliminating subsidies. The problem is – Open Enrollment begins in 18 days! How will people be able to make intelligent decisions about health care choices during this years open enrollment period is a huge concern for our office.
As always, we will be here to help you through this mess. We expect a number of twists and turns.
Trump Administration changes Birth Control requirements
- Sunday, 08 October 2017 06:57
WASHINGTON/NEW YORK (Reuters) – President Donald Trump’s administration on Friday undermined requirements under the Obamacare law that employers provide insurance to cover women’s birth control, keeping a campaign pledge that pleased his conservative Christian supporters.
New rules from the Department of Health and Human Services will let businesses or non-profit organizations lodge religious or moral objections to obtain an exemption from the law’s mandate that employers provide contraceptives coverage in health insurance with no co-payment.
Conservative Christian activists and congressional Republicans praised the move, while reproductive rights advocates and Democrats criticized it. It was unclear how many employers would actually drop birth control coverage on religious grounds, and there were significant doubts that many big ones would.
Within hours, the American Civil Liberties Union sued the administration in federal court in San Francisco to try to halt the rule, claiming among other things that it violated the U.S. Constitution’s requirement for separation of church and state.
The states of Massachusetts and California also sued, and Democratic state attorneys general in another 16 states threatened legal action.
“This is a landmark day for religious liberty. Under the Obama administration, this constitutional right was seriously eroded,” Republican House of Representatives Speaker Paul Ryan said.
“The Trump administration just took direct aim at birth control coverage for 62 million women,” Planned Parenthood Federation of America President Cecile Richards said.
Obama administration confirms double-digit premium hikes
- Wednesday, 26 October 2016 15:17
From The AP:
“WASHINGTON – Premiums will go up sharply next year under President Barack Obama’s health care law, and many consumers will be down to just one insurer, the administration confirmed Monday. That’s sure to stoke another “Obamacare” controversy days before a presidential election.
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