Category Archives: markets

There Are Worse Names to be Called

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Recall the Bowie State University Obamacare kerfuffle [emphasis in the original].

Bowie State University has suspended offering health insurance for domestic students for the 2013-2014 academic year.  Due to new requirements of the Affordable Care Act which will go into effect on January 1, 2014, the cost of insurance for domestic students will increase to approximately $1800 per year [from $54/semester].  If you were covered by the university health insurance last Spring 2013, your policy will expire on August 29, 2013.

Earlier this month, BSU student Eugene Craig objected via the BSU newspaper, The Bulldog Collegian; his article had this closer:

Dr [Rita, BSU Wellness Center Director] Wutoh made the announcement that the university would not be providing coverage for students this academic year, and that they could obtain insurance through the Maryland Health Insurance exchange.  I guess if you like your coverage you really can’t keep it as millions of Americans have been finding out over the last month.  As the plan the University has provided for many semester is considered to be out of compliance with the rules that HHS released for Colleges and Universities the University is forced to send everyone to the Maryland Exchange.  This is one sure way to make sure those “Invincible Millennials” are on the exchanges to make sure the cost of the ACA is balanced out.

Craig since has been roundly criticized, including by school administrators and via his Facebook page.  There, alumni (!) are calling him the “wanna be grandson of Clarence Thomas.”

Worse names, indeed.

Another Implication

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…of Obamacare.

Unlike drug addicts, alcoholics, or the obese—all of whom represent higher-than-average medical costs—smokers are the only such group with a pre-existing condition that ObamaCare penalizes. It allows insurance companies to charge smokers up to 50 percent more than non-smokers for an identical policy….

There are a couple of things about this.  One is singling out a particular group for special treatment.  This is what the Obama administration does routinely, though.  Equality under law simply is inconceivable to President Barack Obama and his cronies.

The other is that “[Obamacare] allows insurance companies to charge” bit.  Big Government knows best.  Heaven forfend that a market solution, with individual Americans making our own decisions in an environment where businesses compete for customers without government interference, should be allowed.  Likely at lower cost to us, to boot.

And this double whammy especially hurts the poor, whom Obama studiously ignores in his drive to…deal with…the middle class.  The same high premiums hammer these poor—their low incomes are a major part of why they’re in that “47 million” who don’t have insurance, in the first place—but the subsidies for which they’re eligible cannot be used on the smoker surcharge, which is the mechanism by which the insurer is permitted to plus up the basic premium.

For instance, 64-yr-old non-smoker can get a Silver health “insurance” plan for $9,000 (!) per year.  A 64-yr-old non-smoker will pay $13,600 for the same plan.  Both non-smoker and smoker of an income level can get a subsidy for the $9,000 basic premium, but the smoker is on his own for those additional $4,600.

How Does This Work?

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The CMS has a Request for Proposal out [emphasis added]:

Solicitation Number: RFP-CMS-RMADA-2014
Notice Type: Modification/Amendment
Synopsis: Added: Nov 20, 2013 1:17 pm

The purpose is to develop a Research, Measurement, Assessment, Design, and Analysis (RMADA) IDIQ [Indefinite Delivery, Indefinite Quantity contracting/procurement type] to respond to expanded needs of the Patient Protection and Affordable Care ACT (ACA) and Health Care reform ACT (HCERA).  The work awarded under the RMADA will involve the design, implementation and evaluation of a broad range of research and/or payment and service delivery models to test their potential for reducing expenditures for Medicare, Medicaid, CHIP, and uninsured beneficiaries while maintaining or improving quality of care.

Section C of this RFP has this expansion [emphasis added]:

…the [CMS] will award task orders (TOs) for a wide range of analytic support and technical assistance activities that support models and demonstration programs created or derived under the auspices of the Patient Protection & Affordable Care Act (ACA), and future health reform legislation where new delivery and payment reform models are enacted.  The demands of new reforms created under ACA have redefined the way CMS approaches and conducts research activities and demonstrations affecting Medicare, Medicaid, CHIP, and uninsured populations.  The role of state and private sector payers is also redefined as many of the new models include multiple payers working in collaboration with CMS to reform the care delivery system.  The RMADA will provide CMS with a robust tool to meet those challenges.  Some of the major activities this umbrella contract will address include the following: designing, maintaining and refining model/demonstration design and operations; monitoring model site implementations; designing and carrying out surveys and other data collection activities; obtaining and analyzing secondary data sources including Medicare, Medicaid and Children’s Health Insurance Program (CHIP), and private payer sources that support model design and evaluations.  Some other evaluation activities envisioned under the RMADA include reporting on formative and summative analyses, providing rapid cycle quarterly evaluation feedback to all model participants and CMS, and the creation of summative annual and final program findings.

Aside from only just figuring out that “The demands of new reforms created under ACA have redefined the way CMS approaches and conducts research activities and demonstrations affecting Medicare, Medicaid, CHIP, and uninsured populations” and “The role of state and private sector payers is also redefined…,” they’ve also just discovered HHS, or its CMS ObamaMart Project “Integrator,” hadn’t thought about doing these things from the jump.

As a result, now they want to spend an additional $7 billion of our money on their failure.  Probably, it’s too much to hope for any of these billions being committed to saving pennies will be committed to reducing the costs of all that added reporting and paperwork.  Or even that the entire $7 billion could be saved (and sent over to Treasury to reduce our national debt) with withdrawing this foolish RFP.

Obamacare: Year Two

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President Barack Obama, through his HHS Secretary Kathleen Sebelius, has decided to delay the open enrollment period for the second year of his Obamacare by a month.  Obama has said, through his Press Secretary Jay Carney, that the delay will give insurance companies more time to evaluate the results of this year’s enrollments and so to adjust their premiums for that second year.

A carefully anonymous “HHS spokesman” also claims

This change is good news for consumers, who will have more time to learn about plans before enrolling and an open enrollment period that’s a week longer[.]

Both of these claims, of course, are nonsense.  Manhattan Institute Fellow Yevgeniy Feyman pointed out Friday

You are delaying open enrollment [in 2014] for one month.  Premiums are submitted in April, so whether you have open enrollment on Oct 1 or Nov 1, those premiums are already set in stone.  People will just be enrolling a month later.

What else is happening then?  Let’s see….  Oh, yeah—mid-term elections, which has become a referendum on Obamacare as the program has its effects on Americans.  The delay puts enrollment, which would have begun in mid-October, some three weeks prior to the mid-terms, into mid-November—after those elections.

With the premiums already determined—some months prior—Obama’s plain hope here is that the American voter will remain ignorant of the costs of the policies they’re stuck with buying or stuck with renewing and that they will have forgotten the costs already inflicted over the current year from the  cancelations of policies that Americans wanted and the policies’ replacement with poorer policies that have higher premiums, higher deductibles, and “coverage” for things that aren’t wanted or needed.

This is Progressives’ politics at their ugliest.  Yes, even worse than Senate Majority Leader Harry Reid’s (D, NV) pernicious destruction of the Senate filibuster.

America’s Health Insurance Plans

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AHIP is “the national trade association representing the health insurance industry” according to their Web site.  As a leader in the health insurance industry I thought they might be able to shed some light on the widely posited difficulties of implementing President Barack Obama’s latest Obamacare “fix” of “encouraging” health insurance companies to stop canceling non-Obamacare compliant policies, as the law requires, and reinstate already canceled policies.  Accordingly, last week I sent an email to AHIP asking a couple of simple questions:

Gentlemen:
I’m a conservative blogger at APlebesSite.com; you can poke around the blog and see that while I’m unabashedly conservative, I try to write from facts and logic rather than simply from polemics.
To that end, I’d like to write an article on the logistics of reviving cancelled health insurance policies, and so I’d like to ask you some questions (and probably engage in some back and forth as new questions arise, so as to be sure I write accurately).
My questions center on two premises: first, the relevant state commissions already have approved the plans you wish to revive, and so they should not be a problem.  Obviously, they’re not always going to be cooperative (vis., Washington), and you have no control over that.  For this purpose, I’d like to assume the commissions are not a problem.  I’ll make clear in my article that I’m eliding state insurance commission matters.
The second premise is that you already have these policies built and archived–at the least you’d need copies of what you sold in case of later litigation, so that you’d not have to rely on plaintiffs’ versions.  Thus, there would seem to be no problem recreating the policies for further sale or for reinstatement with those customers who received cancellation notices.
Despite this, there has been a lot of publicity about how hard it is, logistically, to revive and resell these cancelled policies.  With all the publicity, though, there has been no commentary on the whys of that difficulty, only a long series of unsubstantiated claims.  I’d like to understand the logistic difficulty, so that I can write accurately.
Thus, as a start, please walk me through the process of recreating a typical health insurance policy that was cancelled and then offering it to customers, on the assumption that the states’ insurance commissions do not represent roadblocks.  As I said, I’ll likely have followup questions as I begin to understand the problems involved.  I don’t want to post my article until I have a fuller understanding than I do now.
Thank you for your time and patience.

It’s been more than a week, and apparently AHIP has chosen not to respond.  Which raises another question: why would a health insurance trade association not want to explain the difficulties in reviving and reselling already built and approved (with that status existing as recently as just a few weeks ago) health insurance policies?  Why would they not want to substantiate these claims?