The Legislature in MA yesterday passed a bill that limits the cost of health care to the rate of economic growth in the state. This will be a challenge for providers and insurers as medical costs increased 6-7% in 2010 while the state economy grew by only 3.6%. More details in this Boston Globe article:
http://www.bostonglobe.com/lifestyle/health-wellness/2012/07/30/legislative-leaders-reach-compromise-plan-control-health-care-spending/nVM0gPAYznIo4Vc9YYlgyH/story.html?
Will this work? Hard to say but MA s the first state in the country to set such a target. More details to follow.
Tuesday, July 31, 2012
Wednesday, July 25, 2012
HCCI Report: Rising HC Costs Due to Children
According to a report from the Health Care Cost Institute,
a Washington, DC-based research group, spending on healthcare costs for
commercially insured children under age 18 grew faster than spending
for adults from 2007 to 2010. HCCI had access to three billion health
insurance claims from Aetna, Humana, and UnitedHealthcare.
Insurers and consumers spent nearly $88 billion on healthcare for children in 2010, up by 12% percent from 2007, according to the HCCI. Spending increased even though the number of children covered by employer-sponsored insurance dropped from 44 million in 2007 to 41.4 million in 2010.
By comparison, healthcare costs for adults increased by 8%. For the full report please clink on the link below.
http://www.healthcostinstitute.org/childrensreport
Insurers and consumers spent nearly $88 billion on healthcare for children in 2010, up by 12% percent from 2007, according to the HCCI. Spending increased even though the number of children covered by employer-sponsored insurance dropped from 44 million in 2007 to 41.4 million in 2010.
By comparison, healthcare costs for adults increased by 8%. For the full report please clink on the link below.
http://www.healthcostinstitute.org/childrensreport
Friday, June 29, 2012
Good Summary of What the SC Ruling Means for Medicaid Expansion
One of the key ways of expanding coverage in the ACA was raising Medicaid eligibility to 133% of the poverty level. 29 states opposed being compelled by the feds to do so and now given yesterday's ruling they now have the option not to do so. What does this mean?
If some states do reject the Medicaid expansion, consumers between 100% of poverty and 133% of poverty would become eligible for the private federally subsidized insurance in the exchanges since the subsidies start at 100% of poverty. That would mean more business for those offering private insurance in the exchanges.
It also means that the federal government’s cost of covering these people would increase—covering them under Medicaid would be cheaper than under the private plans in the exchanges.
For those between 100% of poverty and 133% of poverty, it would be a mixed bag. Instead of a Medicaid plan, they would get a mainstream private insurance plan from the exchange that could gain them access to the health care system beyond only the providers who accept Medicaid patients. But they would have to pay 2% of their income in premiums—$600 a year if they make $30,000 a year. And, unlike Medicaid, they would be subject to standard deductibles and copays—perhaps an upfront $1,000 deductible per person. The cheapest plan, the bronze plan, is intended to only cover about 60% of health care costs.
Governors even end up having an incentive to dump Medicaid people onto the exchange—the state has to pay 10% of any Medicaid extension starting in 2017 but none of the cost of subsidies in the private exchanges.
And, some states don't now provide Medicaid coverage for some poor people making less than 100% of the poverty level--leaving them caught in a gap before federal coverage starts at 100%.
So, it’s not an open and shut case for the states on what they should do.
If some states do reject the Medicaid expansion, consumers between 100% of poverty and 133% of poverty would become eligible for the private federally subsidized insurance in the exchanges since the subsidies start at 100% of poverty. That would mean more business for those offering private insurance in the exchanges.
It also means that the federal government’s cost of covering these people would increase—covering them under Medicaid would be cheaper than under the private plans in the exchanges.
For those between 100% of poverty and 133% of poverty, it would be a mixed bag. Instead of a Medicaid plan, they would get a mainstream private insurance plan from the exchange that could gain them access to the health care system beyond only the providers who accept Medicaid patients. But they would have to pay 2% of their income in premiums—$600 a year if they make $30,000 a year. And, unlike Medicaid, they would be subject to standard deductibles and copays—perhaps an upfront $1,000 deductible per person. The cheapest plan, the bronze plan, is intended to only cover about 60% of health care costs.
Governors even end up having an incentive to dump Medicaid people onto the exchange—the state has to pay 10% of any Medicaid extension starting in 2017 but none of the cost of subsidies in the private exchanges.
And, some states don't now provide Medicaid coverage for some poor people making less than 100% of the poverty level--leaving them caught in a gap before federal coverage starts at 100%.
So, it’s not an open and shut case for the states on what they should do.
Tuesday, May 22, 2012
Many States Will Not Have Their HIX Ready 2014
It made little sense to me to invent the wheel 50 times throughout the country but to appease conservatives and lessen the concern about the federal government takeover of health care, the ACA gave the power to the states to create their own HIXs. But in a true irony, given how few states will be ready come 2014, the feds will have to step in and play a minor to major role in approximately 40 states or more come 2014.
http://www.politico.com/news/stories/0512/76596.html
http://www.politico.com/news/stories/0512/76596.html
Monday, May 21, 2012
Under 65 HC Claims Data Study Reveals Interesting Results
The first report based on claims data for the under 65 insurance market was released last week. Some of the findings include:
--Prices for care outside the hospital grew faster (10.1%) than care for patients admitted to the hospital (5.5%), though the average price for outpatient care was a fraction of inpatient care. The average price for care provided to patients admitted to the hospital was $14,662, compared with $2,224 for outpatient care.
The researchers found that price was still the major driver of costs even after adjusting for intensity of service
--Prices for care outside the hospital grew faster (10.1%) than care for patients admitted to the hospital (5.5%), though the average price for outpatient care was a fraction of inpatient care. The average price for care provided to patients admitted to the hospital was $14,662, compared with $2,224 for outpatient care.
The researchers found that price was still the major driver of costs even after adjusting for intensity of service
Wednesday, May 9, 2012
State HIXs Should Limit Plan Choices
Each state has the flexibility to create the HIX that it believes best serves its market. Right now only two states, Utah and Massachusetts, have established HIXs. Utah allows any insurer to market its product(s) while Massachusetts limits the number of products offered. My experience shows that the MA model makes the most sense. Health insurance is very confusing to the average consumer so limiting the amount of choices is best. Research has shown that the more choices a consumer has the more difficult it is for them to make a purchase decision. This is particularly true for health insurance.
http://thehill.com/blogs/healthwatch/health-reform-implementation/226085-study-states-should-limit-number-of-plans-in-exchanges
http://thehill.com/blogs/healthwatch/health-reform-implementation/226085-study-states-should-limit-number-of-plans-in-exchanges
HHS Regulatory Review: All Bark No Bite
It is nice that HHS can call out insurers for "unreasonable" rate increases on their individual products but in the end the feds cannot stop them from doing it.
http://www.politico.com/news/stories/0512/76066.html
http://www.politico.com/news/stories/0512/76066.html
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