CBO

 

A couple of weeks ago I went on a bit of a rant about some terribly irresponsible reporting about how much the American Rescue Plan is spending on subsidizing private health insurance and how many people that money is expected to provide insurance premium assistance for.

The bottom line is that a whole lot of people got both the numerator and denominator wrong: Instead of being ~$53 billion to cover ~1.3 million people (which would be an insane $40,000 per person for just six months), it's actually more like ~$61 billion to help cover ~18.6 million people (roughly $3,300 per person per year on average).

The main focus of the post was about how much/how many would be covered under COBRA (the Consolidated Omnibus Budet Reconciliation Act):

NOTE: SEE SUMMARY TABLE IN UPDATE ALL THE WAY AT THE END.

I'm doing my best to stop myself from putting my head through a wall this weekend.

You may have seen this viral tweet making the rounds over the past day or so:

The Democrats just spent $52 billion to subsidize COBRA for 1.3 million people until September. That’s $40k per person for less than 6 months of health insurance. Most countries spend about $5-6k per person per year for universal healthcare.

— cabral (@axcomrade) March 12, 2021

This was posted at 12:22pm on Friday, March 12th, 2021. It's still live as of 11:00am on Sunday the 14th, has over 32,700 Likes and has been retweeted over 7,300 times as of this writing, but in case it's deleted by the time you read this, here's a screen shot:

A few minutes ago the Congressional Budget Office released a new report on a national, universal single payer healthcare system (commonly known as "Medicare for All" these days, although that's a bit of a misnomer since the proposed "Medicare for All" bills are quite different from today's definition of Medicare).

It's important to note that while this report came from the CBO, it is not a budget analysis of either the House or Senate MFA bills; it instead lays out the structural components which would be required to be in place in order to put such a system together and, I presume, in order to run such a budget analysis.

I'm swamped today between the rollouts of both the Choose Medicare Act and the revised Medicare for America Act as well as this new CBO report, so for the moment I'll just repost the summary and link to the report itself, along with a few notes as I'm able to add them:

I'm a little late to the party on this one, but a week or so ago, the Congressional Budget Office released their own report breaking out estimates of just how many Americans have different types of major helathcare coverage (public or private) for each of the past four years (2015 - 2018).

Their conclusions show a far less dramatic change compared to the survey released by Gallup back in January, which claimed that the uninsured rate for adults over 18 increased from 10.9% at the end of 2016 (just as President Obama left office) to 13.7% at the end of 2018. Based on their estimates, that amounts to around 6.8 million adults losing coverage over that time...and that doesn't include children, so the Gallup estimates, if accurate, would top 7 million people losing coverage.

Instead, the CBO report shows a far lower, but still troubling, trend since the day Donald Trump took office:

Just an hour or so ago I posted about a vice president of the Blue Cross Blue Shield Association stating point-blank what I and every other healthcare wonk under the sun has been warning for months (or years, really, if you include the original justification for the Individual Mandate under RomneyCare):

Kris Haltmeyer, a vice president at the Blue Cross Blue Shield Association, told reporters that the premium increases were in part due to the repeal of ObamaCare’s individual mandate in the Republican tax reform bill in December...“With the repeal of the individual mandate and the failure of Congress to enact stabilization legislation, we are expecting premiums to go up substantially,” Haltmeyer said.

...He said the premium increases are “related to the loss of the mandate and then underlying medical costs.”

“Those two things have the most impact on the rate increases,” he added.

...Oh, and what comes after mandate repeal and underlying medical costs? You guessed it: #ShortAssPlans

Well, Keith Hall, Director of the Congressional Budget Office, just confirmed pretty much everything that we've been saying for a year or more now:

The Affordable Care Act (ACA), in section 1402, requires insurers who participate in the marketplaces established under that act to offer CSRs to eligible people who purchase silver plans through the marketplaces. CBO views that requirement as establishing an entitlement for thoseeligible.

To qualify for CSRs, people must purchase a plan through a marketplace and generally have income between 100 percent and 250 percent of the federal poverty guidelines (also known as the federal poverty level, or FPL). The size of the subsidy varies with income.

CSRs reduce deductibles and other out-of-pocket expenses like copayments. For example, in 2017, by CBOs estimates, the average deductible for a single policyholder (for medical and drug expenses combined) with a silver plan varied according to income in the followingway:

Welp. The Congressional Budget Office just released their latest 10-year economic outlook. There's a whole mess of stuff in there, but let's focus in on one area of particular interest to the healthcare wonk community:

Health Insurance Subsidies and Related Spending. Outlays for health insurance subsidies and related spending are estimated to increase by $10 billion, or 21 percent, in 2018.8 That jump mostly stems from an average increase of 34 percent in premiums for the second-lowest-cost “silver” plan in health insurance marketplaces established under the Affordable Care Act. (Those premiums are the benchmark for determining subsidies for plans obtained through the marketplaces.) Over the 2019–2028 period, the average growth in spending is projected to lessen considerably, to just under 5 percent per year, as per-beneficiary spending rises with the costs of providing medical care. CBO estimates that, under current law, outlays for health insurance subsidies and related spending would rise by about 60 percent over the projection period, increasing from $58 billion in 2018 to $91 billion by 2028.

Yup, thanks to deliberate sabotage from the first two years of the Trump Administration, premiums have spiked by ~30% this year and will do so again next year, requiring federal spending on subsidies to increase accordingly.

Feast your eyes on the fallout...

The Bipartisan Health Care Stabilization Act of 2018 (BHCSA) would make several changes to health care laws. It would:

  • Change the state innovation waiver process established by the Affordable Care Act (ACA),
  • Appropriate a total of $30.5 billion for reinsurance programs or invisible high-risk pools in the nongroup insurance market,
  • Appropriate funds for the direct payment for cost-sharing reductions (CSRs) through 2021,
  • Allow any enrollee in the nongroup market to purchase a catastrophic plan, and
  • Require some existing funding for operations in the health insurance marketplaces to be used specifically for outreach and enrollment activities in 2019 and 2020.

Last week the Congressional Budget Office reported that funding the CHIP program for 5 years, which they had previously estimated would increase the federal deficit by about $8 billion over the next decade, would instead only increase it by about 1/10th as much: Roughly $800 million, a rounding error when it comes to the federal budget. The reason for this isn't that funding CHIP had suddenly become less expensive, it was instead, ironically, because due to the GOP repealing the ACA's individual mandate starting in 2019, NOT funding CHIP has suddenly become more expensive.

All eyes are on the Godawful Tax Scam Bill this week, which once again lies mostly in the hands of a handful of Republican Senators including the usual suspects like John McCain, Lisa Murkwoski and Susan Collins.

McCain's biggest beef this year has been about "following regular order"; it's the reason he shot down the GOP's #BCRAP bill last summer. Of coruse, current tax bill most certainly isn't following regular order either. Will he stick to his guns on the issue or cave under pressure this time? Who knows?

Murkowski was a healthcare hero last summer as well...but she may have been bought off by the addition of a "Polar Payoff" in the form of the bill allowing oil drilling in the Arctic National Wildlife Refuge (ANWR). This is the only reason I can think of that would explain her rather disingenously defensive op-ed piece in the Anchorage Daily News last week.

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