Category Archives: Health Care

Size of Long-term Obligations Varies Across States

Source: Sarah Babbage and Kil Huh, Pew Charitable Trusts, Fiscal 50, August 19, 2014

States commit to future spending both when they borrow and when they fall short of funding the cost of retirement benefits for their public employees. As of fiscal year 2012, the largest of these long-term obligations was unfunded pension liabilities in 35 states, unfunded retiree health care costs in seven states, and public debt in eight states.

States pass balanced budgets each year, but some spending commitments that will not come due for years go unpaid. A snapshot of debt and unfunded retirement costs in fiscal 2012 shows totals of $915 billion in unfunded pension benefits, $757 billion in outstanding public debt, and $577 billion in unfunded retiree health care and other nonpension benefits.

States take on these obligations, which are paid over decades, for different reasons. Sometimes a state borrows to build infrastructure projects that deliver services for years in the future and may spur economic growth. When the bill comes due, states usually cover these debt obligations before other expenses. In other instances, a state creates unfunded liabilities when it sets aside less than is needed to cover the full retirement costs for public services already performed, shifting those expenses to future taxpayers. …

Desperate Retirees: The Perplexing Challenge of Covering Retirement Health Care Costs in a YOYO World

Source: Richard L. Kaplan, Connecticut Insurance Law Journal, Vol. 20 No. 2, 2014

From the abstract:
A retiree’s single largest and most unpredictable expense is paying for health care, and this article explains the various choices and options that a retiree confronts regarding that expense. The article examines the traditional components of Medicare (Parts A and B), prescription drug plans (Medicare Part D), Medigap coverage, and managed care alternatives, as well as long-term care insurance. Each section addresses the financial trade-offs and time-sensitive decisions that are involved.

Medicaid Financing: States’ Increased Reliance on Funds from Health Care Providers and Local Governments Warrants Improved CMS Data Collection

Source: U.S. Government Accountability Office (GAO), GAO-14-627, July 29, 2014

From the summary:
GAO found, based on a questionnaire sent to state Medicaid agencies, that states financed 26 percent, or over $46 billion, of the nonfederal share of Medicaid expenditures with funds from health care providers and local governments in state fiscal year 2012. State funds were most of the remaining nonfederal share. Nationally, states increasingly relied on funds from providers and local governments in recent years to finance the nonfederal share, based on GAO’s analysis (see figure). In the three selected states this increase resulted in cost shifts to the federal government. While the total amount of funds from all sources, including state funds, increased during state fiscal years 2008 through 2012, funds from providers and local governments increased as a percentage of the nonfederal share, while state funds decreased. GAO’s review of selected financing arrangements in California, Illinois, and New York illustrates how the use of funds from providers and local governments can shift costs to the federal government. For example, in Illinois, a $220 million payment increase for nursing facilities funded by a tax on nursing facilities resulted in an estimated $110 million increase in federal matching funds and no increase in state general funds, and a net payment increase to the facilities, after paying the taxes, of $105 million….

State Employee Health Plan Spending

Source: Pew Charitable Trusts, August 2014

From the summary:
A clarifying note and revised data were added to pages 8 and 30 of the report reflecting further analysis of New Jersey. This report provides a first-of-its kind analysis of the costs and characteristics of state employee health plans, and offers a nationwide benchmark against which states can be compared. Collectively, states spent about $31 billion to insure 2.7 million employee households in 2013, a slight uptick in spending from 2011 and 2012 after adjusting for inflation. The average per-employee per-month premium for employees’ and dependents’ coverage was $963. States paid $808 (84 percent) of the total on average, and employees covered the remaining $155 (16 percent). However, this average masks sharp differences across the states, due to factors such as plan richness, average household size, provider price and physician practice patterns, as well as the age and health status of enrollees. The report discusses each of these factors and finds that even after controlling for differences among states in average health plan richness and enrollee households size, a large range in premiums across the states remains. The report also reviews several policy approaches available to states to influence their costs

What Is the Result of States Not Expanding Medicaid?

Source: Stan Dorn, Megan McGrath, John Holahan, Robert Wood Johnson Foundation & the Urban Institute, Timely Analysis of Immediate Health Policy Issues, August 2014

From the summary:
A report by Urban Institute researchers illustrates the economic impact in states where Medicaid is not expanding. In the 24 states that have not expanded Medicaid, 6.7 million residents are projected to remain uninsured in 2016 as a result. These states are forgoing $423.6 billion in federal Medicaid funds from 2013 to 2022, which will lessen economic activity and job growth. Hospitals in these 24 states are also slated to lose a $167.8 billion (31%) boost in Medicaid funding that was originally intended to offset major cuts to their Medicare and Medicaid reimbursement. The authors note that opting to expand Medicaid would generate state savings and revenues exceeding the cost of expansion.

Key Findings:
– States that have not expanded Medicaid will miss out on $423.6 billion in federal funding between 2013 and 2022.
– The decision of state leaders not to expand Medicaid also means their local hospitals will collectively forgo $167.8 billion in Medicaid reimbursement payments over the same timeframe.
– Based on analyses of state budgets, for every $1 a state spends expanding Medicaid, $13.41 in federal funding flows into the state.
– In total, hospitals in states not expanding stand to forgo $167.8 billion in reimbursement funding from 2013 to 2022.

Free Exercise of Religion by Closely Held Corporations: Implications of Burwell v. Hobby Lobby Stores, Inc.

Source: Cynthia Brougher, Congressional Research Service, CRS Report, R43654, July 23, 2014

… This report analyzes the Court’s decision in Hobby Lobby, including arguments made between the majority and dissent, to clarify the scope of the decision and potential impacts for future interpretation of RFRA’s applicability. It also examines potential legislative responses, should Congress consider addressing the current applicability of RFRA. Finally, the report addresses the decision’s effect on requirements that employers offer contraceptive coverage in group health plans under federal or state law. …

Implementing the Affordable Care Act: Delays, Extensions, and Other Actions Taken by the Administration

Source: C. Stephen Redhead,Janet Kinzer, Congressional Research Service, CRS Report, R43474, July 28, 2014

The two federal agencies primarily responsible for administering the private health insurance provisions in the Patient Protection and Affordable Care Act (ACA)—the Centers for Medicare & Medicaid Services (CMS) within the Department of Health and Human Services (HHS), and the Internal Revenue Service (IRS) within the Treasury Department—have taken certain actions to delay, extend, or otherwise modify the law’s implementation. Table 1 summarizes selected administrative actions taken by CMS and the IRS to address ACA implementation. The table entries, which are grouped under general topic headings, are not organized in any particular priority order. Each entry includes a brief summary of the action and some accompanying explanatory material and comments to help provide additional context. Where available, links are provided to relevant regulatory and guidance documents online. Readers are encouraged to review these documents for more details about each action taken. This report is updated periodically to reflect significant ACA implementation actions taken by the Administration. A companion CRS report summarizes all the legislative actions taken by Congress since the ACA’s enactment to repeal, defund, delay, or otherwise amend the law.

Effects of Home-Based Primary Care on Medicare Costs in High-Risk Elders

Source: K. Eric De Jonge, Namirah Jamshed, Daniel Gilden, Joanna Kubisiak, Stephanie R. Bruce and George Taler, Journal of the American Geriatrics Society, Early View, July 18, 2014
(subscription required)

From the abstract:
To determine the effect of home-based primary care (HBPC) on Medicare costs and mortality in frail elders. …

HBPC cases and controls matched for sex, age bands, race, Medicare buy-in status (whether Medicaid covers Part B premiums), long-term nursing home status, cognitive impairment, and frailty. Cases were eligible if enrolled in MedStar Washington Hospital Center’s HBPC program during 2004 to 2008. Controls were selected from Washington, District of Columbia, and urban counties in Virginia, Maryland, and Pennsylvania. ….

Mean age was 83.7 for cases and 82.0 for controls. A majority of both groups was female (77%) and African American (90%). During a mean 2-year follow-up, in univariate analysis, cases had lower Medicare, hospital, and skilled nursing facility care costs, and higher home health and hospice costs. Cases had 23% fewer subspecialist visits and 105% more generalist visits. In a multivariate model, cases had 17% lower Medicare costs, averaging $8,477 less per beneficiary over 2 years of follow-up. There was no difference between cases and controls in mortality or in average time to death.

HBPC reduces Medicare costs for ill elders, with similar survival outcomes in cases and controls. ….

Navigating the Minefields of the Patient Protection and Affordable Care Act

Source: Kevin J. Smith, Employment Relations Today, Vol 41 Issue 2, Summer 2014
(subscription required)

Over four years ago, on March 23, 20 10, the Patient Protection and Affordable Care Act was signed into law by President Obama. The stated purpose of the Act is to improve the availability, quality, and affordability of health insurance coverage in the United States. An important part of the Act is to attempt to reform employment-based health insurance coverage. The Act contains several provisions to “encourage employer sponsored health coverage, including an employer mandate for insurance, an employer penalty for not providing health insurance, a tax credit to increase the affordability of health care for small firms, and a small-business health insurance exchange designed to increase plan options and lower plan costs. As a result, employers seem to be taking the brunt of the effects of the Act. Moreover, various parts of the Act were supposed to go into effect already, while others are supposed to go into effect in the future, by design, or because of delays in enforcement. Whatever the reason for the delays, they have caused considerable uncertainty for employers. As a result, some employers may make decisions that have unintended consequences, or, if they are not careful, cause them to violate the Act and pay exorbitant penalties. …

Invisible Women: Why an Exemption for Hobby Lobby Would Violate the Establishment Clause

Source: Frederick Mark Gedicks, Andrew Koppelman, Northwestern Public Law Research Paper No. 14-34, March 15, 2014

From the abstract:
Can an employer make his employees foot the bill for his religious beliefs? Merely to ask this question is to answer it. “Religious liberty” does not and cannot include the right to impose the costs of observing one’s religion on someone else. Indeed, the Supreme Court has consistently interpreted the Free Exercise Clause, the Establishment Clause, and Title VII of the Civil Rights Act of 1964 to forbid permissive accommodations of religion in the for-profit workplace when they impose significant burdens on identifiable and discrete third parties.

In Sebelius v. Hobby Lobby Stores, Inc., however, an employer is claiming that the Religious Freedom Restoration Act (RFRA) excuses it from providing health insurance coverage for certain contraceptives under the Affordable Care Act (the “contraception mandate”), coverage that would significantly benefit female employees and covered female dependents who do not share the employer’s religious beliefs. Yet, the women who would be harmed by denial of contraception coverage have been absent from the litigation. Courts have imagined that they are balancing the employer’s religious liberty against some generalized government interest in public health or workplace equality, rather than in the religious and other liberties of actual people whom the Constitution and federal statutes protect from paying the costs of observing their employer’s religious beliefs and practices.

If the Court grants a RFRA exemption to Hobby Lobby, it will initiate a religious accommodation regime in which the religious practices of for-profit employers would be accommodated despite imposing significant costs on their female employees and covered female dependents, while under Title VII those same employers would be almost entirely free from a duty to accommodate the religious practices of those same employees. When a private actor seeks to burden control over reproduction to facilitate that actor’s religious exercise, and the courts don’t even notice the dramatic asymmetry that this deprivation would create in religious accommodation law, then they replicate the very religious discrimination they should be eliminating.

There is no conceivable justification for a permissive accommodation regime that is more sensitive to burdens on a for-profit employer’s religious beliefs than it is to comparable burdens on the religious and other liberties of that same employer’s female employees. Once one realizes that actual women will pay financial and other costs to facilitate Hobby Lobby’s religious exercise, it becomes clear that what Hobby Lobby wants is not religious liberty for all, but only for itself, and even at the cost of religious oppression of others.