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Millions More Uninsured Could Impact Health Of Those With Insurance, Too

Much has been written lately about how individuals’ health could suffer if they lose insurance under the health proposals circulating in the U.S. House and Senate. But there is another consequence: creating millions more people without insurance could also adversely affect the health of people who remain insured.

“We know that communities with higher rates of uninsurance have worse access to care for those with Medicare or private insurance,” said John Ayanian, director of the Institute for Healthcare Policy and Innovation at the University of Michigan. And if either of the GOP proposals under consideration becomes law, he said, “it’s very likely we would go back to some of those same problems we had a decade ago with high rates of uninsurance.”

The Congressional Budget Office has estimated that either the bill passed by the House or the one under consideration in the Senate could result in more than 20 million more Americans without insurance over the next decade.

Use Our ContentThis KHN story can be republished for free (details).

Ayanian was part of an expert panel from the nonpartisan National Academy of Medicine that examined the implications of being uninsured in a series of studies from 2001 to 2009. An entire report looked solely at the spillover effect of large numbers of uninsured people on those around them. “The Committee believes it both mistaken and dangerous to assume that the persistence of a sizable uninsured population in the United States harms only those who are uninsured,” said the report.

That is mostly because it is difficult for health providers to maintain services in areas with large numbers of patients who cannot pay for care. “Those communities are less attractive for physicians and other health care providers to locate,” said Ayanian. “That affects access to care for everyone,” he said, particularly for critical but high-cost services like trauma care, burn care and neonatal intensive care.

The potential is not merely theoretical. Hospitals in sparsely populated areas, particularly in states that did not opt to expand the Medicaid program, have been cutting back services like maternity care or closing altogether in recent years. These are the same parts of the country that voted for President Donald Trump by large margins.

The impact is not just on availability of services. A 2007 study from researchers at the University of Pennsylvania in the journal Health Affairs found that in areas with many uninsured people, the quality of care was lower as well. Primary care doctors “reported that the higher the proportion of uninsured people in their community, the less likely they are to be able to refer their patients to high-quality specialists,” found the researchers. “Specialists also reported that the higher the community uninsurance rate, the less able they are to deliver high-quality care to their patients,” the study said.

That spillover effect extends beyond access to health care itself, according to a new report from The Commonwealth Fund. Researchers from George Washington University found that if the House-passed health bill were to become law, nearly 1.5 million jobs could be lost over the next decade.

“We’re talking about a net funding loss to states of millions of dollars,” said Leighton Ku, the study’s lead author. “What this means is that states will have higher needs, less revenue to pay for services, and at the same time the federal government is putting less money into Medicaid,” he said. “So it all adds up to a great revenue crunch that’s similar to the Great Recession” of the past decade.

While most of the job losses would be in health care, other jobs would be affected too, he said.

For example, health care workers who lose jobs will then purchase fewer goods and services, affecting the bottom line of local businesses. Health care facilities that were planning to expand might not, affecting the construction industry. And the impact could cross state lines, said Ku. “We might see fewer people going to Disney World,” he said, because people who lose their jobs would lack money to take vacations.

Opposition To GOP Repeal Bill Inches Up And Intensifies

Public opposition to the Republican effort to replace the Affordable Care Act grew stronger this month, but a core group of Republicans remained in support, according to a poll released Friday.

Sixty-one percent of the public said this month they did not like the GOP health care effort, now undergoing a revised push in the Senate. That was a 6 percentage point increase from the Kaiser Family Foundation’s monthly tracking results in June, when 55 percent expressed unfavorable opinions. (Kaiser Health News is an editorially independent program of the foundation.)

The poll also found opposition was becoming more passionate, with more of the public viewing the plan “very” unfavorably. The Affordable Care Act maintained the support of half the populace, nearly double the 28 percent of people who backed the GOP efforts. Two of three people opposed major reductions in Medicaid that are included in the GOP plans.

Use Our ContentThis KHN story can be republished for free (details).

Nonetheless, a majority of Republicans and supporters of President Trump continued to favor the GOP plan, which would increase the number of uninsured as it alters Medicaid and the private insurance markets that have been running since 2014. In fact, in this month’s poll more Republicans said health care is headed in the right direction than believed that in April, before the House passed its version of the health care replacement bill.

Still, most Americans said they would prefer Republicans and Democrats to work together on health care — 71 percent said they would like to see a bipartisan effort to fix the ACA.

The poll of 1,187 adults was conducted July 5 – 10, about a week after the Congressional Budget Office issued its report on the GOP draft legislation. The margin of error was plus or minus 3 points.

GOP Seeks To Sweeten Health Savings Account Deals. Will Consumers Bite?

A growing number of employers are offering workers insurance that links to health savings accounts, and now congressional Republicans want to expand the contribution limits and uses for these tax-exempt funds. But do consumers want them?

A new study found that fewer than half of people with health savings accounts (HSAs) deposited any money in them in 2016. The average total account contribution, including both employer and employee deposits, was $2,922, significantly lower than the maximum allowable contribution for family coverage ($6,750) or individuals ($3,350), according to the study.

Republicans would like to expand the use of health savings accounts and promote them as a way to help consumers play a larger role in controlling their health spending. Plus, they say, the tax advantages of HSAs help consumers afford their care. But the latest study suggests that current legislative proposals may miss the mark.

“If your goal is to increase the number of people with HSA-eligible health coverage and thus HSAs, simply increasing the contribution limits isn’t going to get you there,” said Paul Fronstin, director of the health research and education program at the Employee Benefit Research Institute and the author of the report.

Insuring Your Health

KHN contributing columnist Michelle Andrews writes the series Insuring Your Health, which explores health care coverage and costs.

To contact Michelle with a question or comment, click here.

This KHN story can be republished for free (details).

Only 13 percent of account holders contributed the maximum amount, Fronstin said.

Money that employees contribute to a health savings account doesn’t count as taxable income, and interest and other earnings in the accounts grow tax-free. In addition, to remain nontaxable, the funds must be used to pay for medical expenses, such as doctor or hospital care, dental services and prescriptions. The accounts must be paired with a health plan that has a deductible of at least $1,300 for individual coverage and $2,600 for family coverage.

Both employers and employees can contribute to the accounts, and the money belongs to the employee if he leaves his job.

People with coverage on the individual market who buy a plan that meets federal HSA standards can also open and fund health savings accounts.

In 2016, 20 million people were enrolled in high-deductible health plans with a health savings account, according to America’s Health Insurance Plans, an industry group.

Republicans have proposed to increase the limit on health savings account contributions to equal the deductible and out-of-pocket spending limit starting next year, or at least $6,550 for individuals and $13,100 for families. Their bills would also allow spouses to make catch-up contributions to the same health savings account and let people use funds from their health savings accounts to pay for over-the-counter medications, among other things.The bill being advanced by Senate Majority Leader Mitch McConnell (R-Ky.) also would allow beneficiaries to use their account to pay premiums.

Critics charge that expanding health savings accounts will provide little benefit to lower-income people who have no spare cash to fund them.

The EBRI analysis is based on its database of 5.5 million health savings accounts with $11.4 billion in assets, representing 27 percent of all HSAs. The EBRI study found that roughly two-thirds of account holders withdrew funds that totaled an average annual $1,771 in 2016.

People’s account balances grew over time, the study found. Accounts opened in 2016 had an average balance of just over $1,000, while those opened in 2004 had an average balance of nearly $15,000. Since most people don’t have high health care expenses in any given year, they can build up balances over time, Fronstin said, and people also might contribute more as they learn how the accounts work.

“The longer you’ve had the account, the better you understand the tax benefits and understand the value of making a contribution,” he said.

Please visit khn.org/columnists to send comments or ideas for future topics for the Insuring Your Health column.

HHS Secretary Price: Trump Administration Is Taking Action on Drug Prices

HHS Gov News - July 13, 2017

Health and Human Services Secretary Tom Price, M.D. released the following statement regarding the Centers for Medicare & Medicaid Services’ announcement of proposed reimbursement changes to the 340B drug discount program for Medicare and our nation’s seniors:

“Today’s announcement is a significant step toward fulfilling President Trump’s promise to address rising drug prices.  We are proud to be working to ensure the Medicare program provides the drugs seniors need at a price they can afford.

“This proposal has the potential to reduce drug costs for seniors, by at least an estimated $180 million per year.  If it is adopted, Medicare would pay hospitals for drugs purchased through the 340B discount program at a price more consistent with the actual cost hospitals and other providers pay to acquire those drugs.  Seniors would see those savings passed on to them in the form of lower copays.

“The Medicare proposal is just one step in many efforts underway across HHS to address pricing and availability of drugs.  Today’s proposed Medicare payment rule also includes other measures to help put patients first, part of a broader effort we are undertaking at HHS.”

For more details, see materials from the Centers for Medicare & Medicaid Services here.

Medicare Trustees Report shows trust fund solvent through 2029

HHS Gov News - July 13, 2017

Today, the Medicare Trustees projected that the trust fund financing Medicare’s hospital insurance coverage will be depleted in 2029, one year later than projected in last year’s report. Lower spending in 2016, lower projected inpatient hospital utilization and slightly better projected hospital insurance deficit in 2017 than in 2016 were the contributing factors to the extended solvency projection. Further, because spending levels in Medicare did not exceed its targets, the Independent Payment Advisory Board (IPAB), set up by the Patient Protection and Affordable Care Act (ACA), was not triggered.

“For 51 years, Medicare has played a crucial role in providing healthcare for America’s senior citizens,” said Health and Human Services Secretary Tom Price, M.D. “Unfortunately, on its current trajectory, Medicare’s hospital insurance trust fund will be depleted in just over a decade, while spending on the other elements of the program continues to grow much faster than our economy. As the Trustees Report says, this means that reform to the program is needed. At HHS, we take seriously our responsibility to protect Medicare for this generation and those to come, and we are pursuing all available avenues to improve Medicare’s sustainability in ways that put patients first.”

In 2016, the Medicare program provided health insurance coverage to 56.8 million beneficiaries. Total Medicare expenditures were $679 billion, and income was $710 billion. Total Medicare spending was slightly lower than estimated in last year’s Trustees Report. Outlays were slightly lower for Part A and Part D than previously estimated while Part B expenditures were very close to the 2016 estimate.

“Millions of Americans rely on the healthcare they receive from Medicare,” said CMS Administrator Seema Verma. “As stewards of this program, CMS will continue to do all we can to reduce out-of-pocket costs for beneficiaries and increase the quality of and access to healthcare for our seniors.”

The Trustees project that total Medicare costs will grow from approximately 3.6 percent of GDP in 2016 to 5.6 percent of GDP by 2041 and will increase gradually thereafter to about 5.9 percent of GDP by 2091. This projected cost growth exceeds GDP growth through the mid-2030s and is the direct result of a rapidly aging population, caused by the large baby-boom generation entering retirement, and lower-birth-rate generations entering employment. Growth in expenditures per Medicare beneficiary exceeds growth in per capita GDP over this time period. In later years, projected costs expressed as a share of GDP will rise slowly for Medicare, reflecting very gradual population aging caused by increasing longevity and slower growth in per-beneficiary health care costs.

The Trustees project that the 2018 Part B premium will remain at the 2017 levels and that the Social Security cost of living adjustment would be 2.2 percent. Due to low trend increases and Medicare’s “hold harmless” protection, about 70 percent of Medicare beneficiaries have experienced very modest increases in their Part B premium rates since 2013. Finally, the report also noted that the Supplementary Medical Insurance program (Part B and Prescription Drug Coverage) continue to grow faster than GDP in part due to prescription drug costs rising somewhat more quickly than other medical services.

The Medicare Trustees are: Health and Human Services Secretary, Tom Price, M.D.; Treasury Secretary and Managing Trustee, Steven Mnuchin; Labor Secretary, Alexander Acosta; and Acting Social Security Commissioner, Nancy A. Berryhill. CMS Administrator Seema Verma is the secretary of the board.

A copy of the report is available here: https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/ReportsTrustFunds/index.html

A copy of the IPAB letter can be found here: https://www.cms.gov/Research-Statistics-Data-and-Systems/Research/ActuarialStudies/IPAB-Determination.html

Senate Health Bill Still Short On ‘Yays’ But Leaders Vow Vote Next Week

Senate Republican leaders Thursday released their revised bill to “repeal and replace” the Affordable Care Act, but they acknowledged that furious days of negotiation have not yet secured the 50 votes necessary to pass the measure over unanimous Democratic objections.

Sen. John Cornyn (R-Texas) the No. 2 GOP leader, told reporters that while backers of the measure did not yet have the GOP votes needed, “we will by the time we vote.”

The revised draft was presented to Republican senators at a closed meeting Thursday morning. Among its many provisions, it would cap federal funding for the Medicaid program, covers more than 70 million low-income Americans, and give states authority to waive insurance regulations in the ACA.

Senate Majority Leader Mitch McConnell (R-Ky.) has been struggling for more than two weeks to satisfy holdouts from both wings of the party. Conservatives complain that the draft bill unveiled last month did not go far enough to repeal many of the ACA’s regulations, while moderates argue that structural changes and cuts to the Medicaid program for the poor are too deep.

Use Our ContentThis KHN story can be republished for free (details).

So far, two of the 52 Republican senators have declared they will not even vote for the preliminary motion that would begin formal debate: conservative Rand Paul of Kentucky and moderate Susan Collins of Maine. “Still deep cuts to Medicaid,” Collins tweeted. “Will vote no on” motion to proceed to the bill.

Collins told reporters separately that she cannot support the bill, and criticized Senate leaders for the way they produced it. Such a fundamental change to Medicaid should have a full set of legislative hearings, she explained. Even fully repealing the ACA would not cap spending for Medicaid in the way the Senate bill is proposing. “Repealing Obamcare would not change the underlying Medicaid program,” she said.

The ACA expanded Medicaid, but the Senate changes would cut it back well beyond that expansion.

One more “no” vote would stop the bill in its tracks, even with a potential tie-breaking vote from Vice President Mike Pence. Several moderate senators emerged from the closed meeting saying they were still undecided, including Shelley Moore Capito (R-W.Va.) and Lisa Murkowski (R-Alaska).

Leaders did, however, apparently satisfy some of their more conservative members by making some changes proposed by Ted Cruz (R-Texas). Cruz touted after the meeting that the legislation includes provisions to allow people to use tax-preferred health savings accounts to pay insurance premiums (which are currently banned). It would also allow anyone to purchase a plan that covers only catastrophic health expenses (which the ACA limits to those under age 30) and permit insurers to offer plans that do not conform to many of the regulations in current law. Those rules include the ACA’s requirements for coverage of specific health benefits as well as bans on insurers charging sick people more and limiting out-of-pocket costs.

How Does The Senate Health Plan Affect You?

As the Senate considers its overhaul of the Affordable Care Act, Kaiser Health News has offered a variety of stories about the effects of the Republican proposals. Here’s coverage that may be helpful as you weigh the most recent GOP measure:

View More

Senate leaders offered to spend more money on people who could be adversely affected by the insurance changes, including an additional $45 billion to combat opioid abuse, but moderates said it does not solve the problem.

“There’s money,” Collins told reporters, “but too many uses for that money.”

Democrats remained steadfastly opposed to the measure. “The meat of this bill is exactly the same as it was before, and in some ways, they’ve somehow managed to make it even worse,” said Minority Leader Chuck Schumer (D-N.Y.).

Even if leaders round up the needed votes, there are still a number of obstacles between this draft bill and President Donald Trump’s signature. They include:

Procedural Restrictions

Republicans are trying to pass their health bill using a special budget process that lets them avoid a filibuster and the usual requirement to get 60 votes for passage. But strict rules govern what can and cannot be included in such a “budget reconciliation” bill. Democrats this week are arguing to the Senate parliamentarian that many sections of the bill should not be allowed, including those that would impose abortion restrictions and modify the private insurance regulations included in the ACA.

Cost Estimates

The Congressional Budget Office is the official scorekeeper for Congress. It said the first version of the Senate bill would result in 22 million more uninsured people by 2026.

But some Senate Republicans on Thursday said that rather than wait for the CBO to score the changes to the bill, they might ask the Department of Health and Human Services to do it instead. That would be likely to produce a number more favorable to Republicans.

Democrats saw that option as a partisan play by Republicans. “It’s gaming the score,” said Sen. Sherrod Brown (D-Ohio). “Why don’t they just have the score written in McConnell’s office by his staff?”

House Passage

Whatever the Senate produces must be acceptable to a majority of the House, or else the two chambers could get bogged down in weeks or months of negotiations. But changes that would make the Senate bill more acceptable to moderates there would likely not be able to get through the more conservative House. Leaders are walking a thin tightrope.

On the other hand, Republicans continue to be driven by the imperative of keeping their seven-year promise to overturn the health law.

“Virtually every Republican in this body has supported the effort to repeal and replace Obamacare more or less since the day it was signed into law,” Senate Finance Committee Chairman Orrin Hatch (R-Utah) said on the floor. “This legislation, while far from perfect, would fulfill the vast majority of those promises.”

Transgender Health Care Targeted In Crusade To Undo ACA

Solorah Singleton has been waiting years for breast augmentation. She doesn’t want to jinx it now, but the Philadelphia resident thinks it’s finally within reach.

Singleton, 36, was born male but identifies as female. For seven years, she has had regular hormone therapy, never seeing surgery as an option. She previously didn’t have health insurance and didn’t think she could cover the cost of the procedure out-of-pocket.

Now, that’s changed. Last summer, her home state of Pennsylvania updated its Medicaid policy to spell out coverage of care related to gender transitioning — including surgery. Soon after, employees at a local health clinic signed Singleton up. She has since received medical approval for surgery and hopes to get it done soon.

“It’s a blessing,” she said. “I’ll feel at home in my own skin.”

Her experience aligns with a larger trend that could soon lose steam. Spurred in part by anti-discrimination rules in the 2010 health law, Pennsylvania — along with 13 other states plus the District of Columbia — rewrote its Medicaid policy to clarify how it covers transition-related care. Montana, the most recent adoptee, posted its change in May. Because Medicaid, the state-federal health insurance program for low-income people, covers a disproportionately high number of transgender people compared with the general population, the potential change could heap hardship on an already embattled population.

This KHN story also ran in The Daily Beast. It can be republished for free (details).

The ACA’s non-discrimination portion, known as Section 1557, says federally funded programs that provide health care, coverage or related services cannot discriminate based on sex. The provision has been in effect since the law’s enactment and helped fuel a federal push to protect transgender people from discrimination in receiving health care services. In 2016, the Obama administration’s Department of Health and Human Services issued the final rule crystallizing that policy.

Before the ACA, Medicaid operated under its own anti-discrimination requirements. However, many state programs were vague in describing gender-transition benefits. This made it difficult for people like Singleton to understand what Medicaid covered. It also made it easier for plans to question the “medical necessity” of treatments and to issue denials.

By making it clear that state Medicaid programs could not refuse to pay for a health care service simply because the beneficiary is transgender, and suggesting greater federal attention to the matter, the Section 1557 rule pushed states to be more upfront about coverage specifics.

Singleton in her salon in west Philadelphia. (Eileen Blass for KHN)

That regulation is back in play as the Department of Health and Human Services appears to be walking back from its directive and coverage protections.

In a Texas case in which faith-affiliated health care providers argued Section 1557 required they act against their religious beliefs — which “will not allow them to perform medical transition procedures that can be deeply harmful to their patients” — a federal judge issued an injunction at the end of 2016 to block the transgender protections. HHS responded by asking the court to remand the case and stay further proceedings while it rewrites the rule. Earlier this week, the judge obliged. In the meantime, that portion of Section 1557 will not be enforced.

The rewrite is part of the administration’s overarching executive effort. HHS Secretary Tom Price and President Donald Trump have vowed to use administrative power to mitigate the health law’s policy changes, specifically those that created “regulatory or economic burdens” or that don’t match up with the current White House agenda.

“Anytime the federal government says ‘we’re not going to take civil rights seriously’ — this is a huge concern,” said Sara Rosenbaum, a professor of health law and policy at George Washington University in Washington, D.C.

An HHS spokeswoman declined to answer what impact rewriting the rule could have or how likely it is the department would scale back transgender protections, citing laws that limit disclosing “non-public information regarding rule-making.”

But if the federal government isn’t asserting a certain coverage standard for publicly funded programs, health plans can find leeway to deny claims and argue a transition-related service is not medically necessary, noted Katie Keith, an adjunct law professor at Georgetown University. She also runs Out2Enroll, an advocacy group that connects LGBTQ people with health insurance options.

The consequences can be serious. Singleton said she has known many people who want hormone therapy but have long felt uncomfortable seeking it at health clinics, because of poor experiences with insurance coverage. Their alternative: buying the drugs through illicit channels, where it’s hard to know if they’re of good quality, or even safe to use.

“If they’re trying to get themselves comfortable with their look, they’ll go to any extreme measures,” she said.

Coverage changes that, she added. “It will definitely improve health situations.”

Singleton (right) colors Aly Damian’s hair at Singleton’s salon in west Philadelphia while Damian video-chats with a family member. Like Singleton, Damian, 27, is transgender and considers Singleton her “gay mother.” (Eileen Blass for KHN)

Even with Medicaid policies explicitly guaranteeing coverage, beneficiaries still navigate plenty of red tape, said Amy Nelson, who directs patient legal services at Whitman-Walker Health, a clinic in Washington, D.C., that specializes in LGBTQ care. It has staff whose entire job is navigating insurance hurdles for people seeking transition-related care.

States that have already rewritten Medicaid policies are unlikely to rescind them, Keith said. But if HHS waters down federal protections, others may be reluctant to hop on. “It makes the state-level work much more important,” she said.

Already, lower courts are offering one path. In Minnesota, a 64-year-old resident sued the state when its Medicaid program wouldn’t cover a transition-related double mastectomy. A county judge held that denying coverage for this procedure violated the state constitution. Advocates have found similar success through legal action in Pennsylvania and New York.

A growing body of research suggests that paying for gender transition doesn’t cost state Medicaid programs much when compared with potential savings down the line that would result from preventing health issues such as long-term psychological distress. Private insurance has also moved in this direction. In 2014, Medicare — the federal program covering elderly people — lifted some restrictions on covering gender transition.

Another complicating factor: the ongoing Obamacare repeal efforts on Capitol Hill. Current GOP health plans don’t address these anti-discrimination regulations because they can include only provisions that qualify for fast-track consideration. Republicans tend to support stepping back from the law’s expansion of Medicaid, which made millions of Americans newly eligible for the program. “It’s great to have 1557 [protections], but if no one can get a health insurance plan, or get Medicaid, it doesn’t matter much,” Keith said.

Plus, those lawmakers want to restructure Medicaid, giving states more control but also limiting its funding. Experts say the change could create cost pressures that would drive states to restrict who is eligible for the program, stop covering particular services or both.

“Transgender people could be vulnerable,” suggested Harper Jean Tobin, policy director at the National Center for Transgender Equality, an advocacy group. “That is more likely if the administration is sending the message to states … that it’s OK to discriminate against transgender people.”

For patients like the ones Nelson sees at Whitman-Walker, the impact would be grim. Some, she recalled, have waited as long as 40 years to get treatment that, without Medicaid benefits, was simply unaffordable.

“They’ve been suffering silently,” she said. “Folks are thrilled to have access. But to offer it and then pull it back would be devastating.”

Senate Revises Health Care Legislation: Read The New Bill

Senate Republicans released Thursday a revised version of the Better Care Reconciliation Act, their plan to replace the Affordable Care Act. The new bill, like earlier versions, would convert Medicaid from an open-ended entitlement to a system of fixed payments to states. Below you can read both versions. You can also compare side-by-side here.

Updated H.R.1628 Bill Text, Released July 13, 2017:

Bill Text Released June 22, 2017:

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