Health care in Texas doesn’t have to be chaotic. We don’t have to make it harder to succeed, harder to hold a job, harder to stay well. Instead of having the highest numbers of uninsured children and adults in the nation, Texas could have the best health care system in America — especially if our governor sincerely is ready to work together to create meaningful coverage and affordable access for Texans. Our state leaders can protect the lives of Texas women and children by keeping mothers covered between pregnancies, preserve the right to cover children up to age 26, and provide options for the millions of people who would lose health coverage if the ACA actually goes away.
The Association for Community Affiliated Plans (ACAP) announced January 9, 2019, that Ken Janda, President and CEO of Community Health Choice, was elected as the organization’s next Chair of its Board of Directors. He was elected to a two-year term. Previously, Mr. Janda served as ACAP’s Vice Chair.
Mr. Janda has led Community Health Choice, located in Houston, since 2008. The nonprofit managed care organization provides health insurance plans to low-income families through programs including Medicaid, the Children’s Health Insurance Program (CHIP), and subsidized individual health plans on the Federal Marketplace. He oversees 700 employees serving more than 400,000 members.
“Safety Net Health Plans—serving more than 20 million members in Medicaid managed care—play an integral role in their community by helping fulfill a wide variety of needs that go beyond health care and help Americans climb up the safety net ladder,” said Mr. Janda. “I’m excited to assume this role and help the Association continue its advocacy efforts in lifting up the country’s most vulnerable populations.”
Mr. Janda possesses strong ties to a variety of organizations in the local Houston community. He sits on the Boards of Directors of Christ Clinic in Katy, Texas; the Katy ISD Educational Foundation; and San Jose Clinic in Houston. Further, he serves on the Greater Houston Partnership’s Health Care Advisory Committee and the Texas Medical Center’s Health Policy Institute’s Executive Committee. Mr. Janda also is part of the Dean’s Advisory Committee to the School of Social Science at Rice University and teaches as an adjunct professor at Jones Business School at Rice University.
“Ken’s steadfast commitment to supporting the safety net make him a natural fit for this position; we look forward to his leadership of our Board over these next two years,” said ACAP CEO Margaret A. Murray. “His deep knowledge and experience in managed care, advocacy, and strategic thinking have added—and will continue to add—creativity as he leads the Board in shaping ACAP’s approach to the changing health policy landscape.”
Many Americans are wondering if they’ll still be able to obtain individual health insurance in 2018. The resounding answer from non-profit and for-profit health insurers is YES, but they have concerns.
In the following excerpt from the October cover story of Managed Healthcare Executive magazine, Houston’s Ken Janda discusses some of his…
Top concerns for 2018
A blanket ACA repeal without a replacement is among the greatest concerns of Ken Janda, JD, president and CEO, Community Health Choice, Inc., a managed care organization based in Houston offering Children’s Medicaid, CHIP programs, and plans through the health insurance marketplace.
“This would be devastating to Americans and hurtful to our healthcare system, as a blanket repeal of the ACA would not only hurt the millions of Americans in the individual market, but it would also change the benefits and protections currently enjoyed under all plans, including employer-sponsored coverage,” he says.
Another primary concern is whether the Trump Administration will withhold funding for cost-sharing reduction payments, says Janda. The payments to insurers were authorized in September, but remain uncertain for future months.
“Without continued reimbursement, monthly premiums could rise across the board and nonprofit insurers like us could take a devastating loss—jeopardizing our future involvement in the individual marketplace. I continue to hope for bipartisan commonsense fixes like the legislation Senators Alexander and Murray have pursued.”
Janda says the lack of enforcement regarding the individual mandate is troubling, as is the fact that the Trump Administration appears to not support open enrollment for marketplace plans. “With the time period for enrollment cut in half, the advertising budget slashed by 90%, and fewer navigators this year, many Americans may not even know they can sign up for health insurance via the marketplace,” he says. “Additionally, the Trump administration has placed doubt and uncertainty in consumers’ minds about whether the individual mandate is being enforced,” he says. “A mechanism to encourage enrollment must exist to incentivize a healthy and robust risk pool—whether via the individual mandate, a premium surcharge, or a waiting period.”
Community Health Choice CEO Ken Janda discusses the proposed Senate Health Care BCRA bill on MSNBC with news anchor Stephanie Ruhle and Dr. Mario Molina, former CEO of Molina Healthcare. Stephanie Ruble’s financial and economic background sets the stage for a conversation about the effects the proposed Senate bill could have on vulnerable populations including children, elderly, disabled, and low-income families.
The American Association of Retired Persons (AARP) consumer organization says BCRA will cut between $2.0 and $3.8 TRILLION more from Medicaid than even the Congressional Budget Office estimates:
By dramatically reducing the per capita cap growth factor beginning in 2025, we project that the Senate bill would cut between $2.0 and $3.8 trillion from total (federal and state) Medicaid spending over the 20-year period between 2017 and 2036 for the four non-expansion Medicaid enrollment groups: older adults, adults with disabilities, children, and non-expansion adults (children with disabilities are excluded because BCRA does not subject them to capped funding). A cut of this magnitude threatens the viability of the program in unprecedented ways and will increase the number of people who no longer have access to essential healthcare services and critical supports. The projections do not include the proposed cuts to the adult expansion population, which would also be considerable.
To learn more about the BCRA, visit these resources:
Kaiser Family Foundation: Premiums under the Senate Better Care Reconciliation Act
KFF compares ACA and BCRA net premiums and tax credit by county
Vox.com explainer on the Congressional Budget Office report
AARP: The Senate Health Reform Bill Slashes Medicaid Severely
Letter from AARP to Senators: AARP Urges the Senate to Vote No on the Better Care Reconciliation Act of 2017
· With less federal reimbursement for Medicaid, states would need to decide whether to commit more of their own resources to finance the program at current-law levels or to reduce spending by cutting payments to health care providers and health plans, eliminating optional services, restricting eligibility for enrollment through work requirements and other changes, or (to the extent feasible) arriving at more efficient methods for delivering services. CBO anticipates that states would adopt a mix of those approaches, which would result in additional savings to the federal government. States would not have substantial additional flexibility under the per capita caps. Under the block grant option, states would have additional flexibility to make changes to their Medicaid program—such as altering cost sharing and, to a limited degree, benefits.
· Under this legislation, starting in 2020, the premium for a silver plan would typically be a relatively high percentage of income for low-income people. The deductible for a plan with an actuarial value of 58 percent would be a significantly higher percentage of income—also making such a plan unattractive, but for a different reason. As a result, despite being eligible for premium tax credits, few low-income people would purchase any plan, CBO and JCT estimate.
· Under this legislation, after the next decade, states would continue to need to arrive at more efficient methods for delivering services (to the extent feasible) and to decide whether to commit more of their own resources, cut payments to health care providers and health plans, eliminate optional services, restrict eligibility for enrollment, or adopt some combination of those approaches. Over the long term, there would be increasing pressure on more states to use all of those tools to a greater extent. CBO and JCT do not have an insurance coverage baseline beyond the coming decade and therefore are not able to quantify the effect on insurance coverage in the long term. However, the agencies expect that after 2026, enrollment in Medicaid would continue to fall relative to what would happen under current law.
New research from Avalere finds that under the American Health Care Act (AHCA), low-income individuals who purchase insurance on an exchange would lose access to cost sharing subsidies that help make accessing healthcare affordable. In a nutshell, the AHCA as written will lead to higher costs for low income and vulnerable Americans.
Currently, these cost sharing reduction (CSR) subsidies reduce deductibles by up to 93 percent and maximum out-of-pockets (MOOPs) by up to 85 percent. The AHCA, as approved by the House, repeals CSR subsidies that reduce out-of-pocket costs for low-income consumers earning less than 250 percent of poverty ($29,700 for an individual). Approximately 5.9 million individuals (56 percent) who purchase coverage on the exchange receive some form of CSRs.
“Eliminating the CSRs could lead to significantly higher costs for a large number of low-income individuals,” said Caroline Pearson, senior vice president at Avalere. “Even if people can pay their monthly premiums, the out-of-pocket costs or other restrictions on benefits may render the coverage unaffordable.”
The Affordable Care Act (ACA) included CSRs to lower cost sharing, including deductibles and maximum out-of-pocket limits or MOOPs (the maximum an individual can pay out-of-pocket for the year). CSRs are available at differing levels of generosity depending on an individual’s income. For example, individuals earning between $12,000 and $18,000 a year (100% to 150% of the FPL) who receive the most generous CSRs had their deductibles reduced from $3,703 to $243 on average and their MOOPs lowered from $6,528 to $978 in 2017.
While the AHCA eliminates CSRs, it also allows states to grant insurers additional flexibility to design benefits, including cost sharing and covered services. In some cases, insurers may choose to offer lower-priced plans or products that include low cost sharing in combination with other design elements (i.e. high-value networks). However, without the CSRs, the scope and affordability of such plans will depend on decisions by states and insurers.
“Compared to the ACA, the AHCA provides no guarantee of affordability for low-income consumers purchasing on the exchange,” said Elizabeth Carpenter, senior vice president at Avalere. “Depending on how states and insurers choose to approach market rules and benefit design, you could see significant variation across states in terms of affordability for low-income consumers.”
Health reforms should build a workable system that helps transition people on the threshold of Medicaid eligibility into the exchanges. Unfortunately, the AHCA doesn’t do this, and the elimination of the CSRs in combination of the AHCA age-based tax credits ensure that low-income individuals will not receive enough financial assistance for health care. So those who are on Medicaid, would rather stay on Medicaid because the benefits are better at a much lower cost. And really, who wouldn’t?
The rush to gather support for legislation can leave the truth behind. Speaker Paul Ryan claims that the MacArthur amendment to the American Health Care Act (AHCA) protects people with pre-existing conditions while lowering premiums. Let us look at each of Speaker Ryan’s “verified” claims one-by-one and explore why each claim is full of misdirection and misinformation.
Claim #1: The MacArthur amendment protects people with pre-existing conditions.
False. At first glance, the MacArthur amendment seems to retain the core provisions of the Affordable Care Act (ACA) that protect Americans with pre-existing conditions. It seems to prohibit insurance companies from charging higher premiums to individuals with pre-existing conditions, also known as community rating, and it seems to prohibit insurance companies from denying coverage to individuals with pre-existing conditions. Upon closer inspection, the MacArthur amendment simply punts the decision to cover pre-existing conditions to states, giving federal legislators political coverage, letting them wash their hands of any responsibility and insulating themselves from blame by allowing themselves an escape to say, “Your state chose to gut protections for pre-existing conditions. Don’t blame us.” However, it is fairly telling when Rep. Billy Long of Missouri and Rep. Fred Upton of Michigan, prominent Republicans who have previously led ACA repeal efforts, come out and say they cannot consciously support the AHCA because of how the MacArthur amendment undermines protections for those with pre-existing conditions.
Claim #2: It provides a strict process to receive a waiver from federal mandates.
False. According to the legislative text of the MacArthur amendment, states may simply “attest” that their waiver will reduce premiums, increase coverage and plan choice, or stabilize the marketplace. This will not be hard for states to claim since any reductions in benefits will result in lower premiums. The claim that this is a strict process is also confusing because the legislative text states that waivers would be automatically approved by Health and Human Services (unless they were disapproved for noncompliance within 60 days). Unlike the requirements for 1332 waiver applications, there is uncertainty as to whether states will even be required to provide evidence of what their waiver purportedly achieves.
Claim #3: It gives states flexibility in addressing health care premiums.
Not really. If flexibility equates to allowing states to strip away the Essential Health Benefits (EHBs) and community rating (as mentioned above) in order to decrease premiums, then yes, this amendment does exactly that. Allowing states to define their own version of EHBs undermines lifetime and annual limits and caps on out-of-pocket expenditures because these provisions only apply to EHBs. The changes to these provisions could potentially impact large group and self-insured employer plans as well. In addition, the MacArthur amendment also allows states to eliminate benefits that were often omitted prior the ACA, such as maternity coverage and mental health parity. Premiums may decrease because nothing is actually covered; but then why pay for non-insurance?
Claim #4: The MacArthur amendment will help lower premiums for Americans.
Half-true. The MacArthur amendment potentially drives down premiums because the health plans are less generous (meaning fewer covered services and benefits) and those who are sicker pay significantly more and placed into a high-risk pool. High-risk pools segregates high-cost individuals and historically charges premiums that are twice the amount a health person would pay and imposes waiting periods and annual limits. Even Wisconsin’s high-risk pool (the example that Speaker Ryan often uses) did not cover pre-existing conditions for the first six months! It would be more accurate for Speaker Ryan to say that under the MacArthur amendment, premiums will decrease for those who healthy and significantly increase costs for those who are sick.
Does it add up?
No. Just because Speaker Ryan places the word “verified” in front of his statement, does not mean that makes those statements truthful. Removing or weakening the EHBs means that certain conditions or services may not be covered, allowing insurance companies to essentially select which individuals they want to cover (hint: they don’t want the sick). Allowing insurance companies to remove community rating means that insurance companies can simply price you out of their coverage if you have a pre-existing condition since they cannot technically refuse you coverage. While not directly stating that protections for pre-existing conditions will be gutted, the MacArthur amendment effectively compromises these protections and puts affordable health care out of reach for millions of Americans with medical conditions that are of no fault of their own (despite what Rep. Mo Brooks of Alabama believes).
The Congressional Budget Office released its cost estimate today for the recent legislation called the “American Health Care Act” or AHCA. In short, the CBO forecast: AHCA reverses Obamacare progress if the AHCA were to become law.
The nonpartisan CBO score shows the AHCA will reverse all the coverage gains of the Affordable Care Act (ACA or “Obamacare”), and result in even fewer people covered with health insurance in the next decade. Read the entire report here, and also understand that we — working on the front lines of safety net health care coverage — believe that some of the projections are too rosy, and the consequences could be worse than estimated. Apparently, the White House agrees with us, with their own internal modeling showing millions more Americans losing insurance.
The vast numbers of Americans losing insurance has huge consequences, as people without insurance are more likely to be sicker longer, with higher costs, and die from treatable conditions, than people who are covered by health insurance.
The CBO estimates:
- 24 million people lose their insurance coverage by 2026, with 14 million losing coverage immediately (2018)
- Health insurance premiums will rise 15 to 20 percent in the short term BUT — and here’s one place we disagree — they think prices will go down in the long term
- The federal deficit could be reduced by $337 billion over the ten years that the uninsured rate rises to 52 million Americans.
The AHCA achieves budget reductions by repealing taxes on wealthy Americans, cutting subsidies provided by those taxes, and slashing Medicaid, the crucial national health care program covering millions of lower-income Americans, particularly women and children. The CBO’s estimate is that Medicaid will be cut 25 percent by 2026, which raises troubling questions: Do we refuse treatment to sick children? Do we pay nurses less? Medicaid isn’t a luxury, so a smaller budget translates into lost jobs, reduced care, and sicker people.
With the loss of the individual mandate in the AHCA, we suspect premium rates could be double or even triple the 15 to 20 percent increase the CBO estimates, as younger and healthier people forgo coverage. Monthly premium prices might drop later only due to people purchasing cheaper so-called “mini-med” plans, that cover a lot less, with even higher deductibles.
Lower premiums depend on some assumptions:
- A substantial increase of healthy, young people participating in the individual market. We’re not sure that is going to happen.
- Grants from the Patient and State Stability Fund to help stabilize premiums and reduce the risk and losses for insurers.
- The risk adjustment program will protect insurers from high losses arising from high-risk enrollees.
According to the CBO, all these factors increase market stability and encourage insurers to continue participating in the individual market. However, CBO doesn’t mention cost-sharing or plan skimpiness as being the reasons why premiums might become lower.
The move from income-based subsidies, which address equity in access to health coverage, to age-based subsidies doesn’t benefit consumers, and particularly older low-income adults, whose premium costs could rise more than 700 percent to become the single largest portion of their income.
Not only does the AHCA remove income-based subsidies, the remaining subsidies (tax credits) are estimated to be cut in half in nine or ten years. From the CBO report: “In 2020, CBO and JCT estimate, the average subsidy under the legislation would be about 60 percent of the average subsidy under current law. In addition, the average subsidy would grow more slowly under the legislation than under current law. That difference results from the fact that subsidies under current law tend to grow with insurance premiums, whereas subsidies under the legislation would grow more slowly, with the consumer price index for all urban consumers plus 1 percentage point. By 2026, CBO and JCT estimate that the average subsidy under the legislation would be about 50 percent of the average subsidy under current law.”
Medical and health organizations such as the American Medical Association (AMA) and the American Association of Retired Persons (AARP) have written letters to Congress stating opposition to the proposed AHCA. We have written Congress as well: we are committed to working with Congress to create better health care policy that covers more people with lower costs; the current AHCA isn’t better policy.
A couple of final thoughts:
The forecast of possible lower premiums in 10 years relative to the ACA is actually quite misleading. Premiums decreased in this model because people will buy skimpier plans. There’s a table showing the actuarial value of plans and they are significantly lower than ACA plans — with much higher cost-sharing. In addition, the premiums are lower because the CBO estimates fewer elderly will sign up because of the higher costs, which lowers the average premium per plan. But of course what happens to these older Americans who aren’t yet eligible for Medicare but can’t afford private insurance? They’re be sicker, die sooner, and – for people looking at financial implications – cost more to treat because they haven’t had care and therefor their health conditions are worse.
Another thing that isn’t really being talked about (yet), the CBO states that the Patient and State Stability Fund will be a primary reason why the market stabilizes. Yet those funds run out in 10 years. So what then?
And in the report, the CBO estimates that the 30% premium surcharge will actually hurt the risk pool, making it a poor substitute for the individual mandate. There’s much more to unpack here, and we’ll update with data and insights as we go forward.
Find out what Texans need to know about the differences between the GOP’s “American Health Care Act” (AHCA) and the Affordable Care Act (ACA). Spoiler alert: the AHCA as written results in health insurance becoming unaffordable for millions of people, with higher costs and lives lost prematurely.
Kaiser Family Foundation (KFF) has a head-to-head comparison tool you can customize for yourself or loved ones. KFF notes: “The maps were updated on March 21, 2017 to show estimates of how much a person buying their own insurance would have to pay under both the ACA and the House replacement bill. The maps include premium tax credit estimates by county for current ACA marketplace enrollees at age 27, 40, or 60 with an annual income of $20,000, $30,000, $40,000, $50,000, $75,000, or $100,000.”
Economic Analyst Steve Rattner shared this chart on the television news program “Morning Joe,” using nonpartisan data from the Congressional Budget Office to show how many Americans will lose health insurance if Congress repeals the Affordable Care Act and passes the GOP’s AHCA.
The AHCA passed the House on a party-line vote, with only GOP / Republican Members voting for it. All Democratic Representatives opposed it and supporting keeping/updating the Affordable Care Act, instead. The ACA has insured more than 20 million Americans.