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Taxation Without Representation: The Illegal IRS Rule to Expand Tax Credits Under the PPACA

August 19, 2014 Comments off

Taxation Without Representation: The Illegal IRS Rule to Expand Tax Credits Under the PPACA
Source: Social Science Research Network

The Patient Protection and Affordable Care Act (PPACA) provides tax credits and subsidies for the purchase of qualifying health insurance plans on state-run insurance exchanges. Contrary to expectations, many states are refusing or otherwise failing to create such exchanges. An Internal Revenue Service (IRS) rule purports to extend these tax credits and subsidies to the purchase of health insurance in federal exchanges created in states without exchanges of their own. This rule lacks statutory authority. The text, structure, and history of the Act show that tax credits and subsidies are not available in federally run exchanges. The IRS rule is contrary to congressional intent and cannot be justified on other legal grounds. Because the granting of tax credits can trigger the imposition of fines on millions of individuals and employers, the IRS rule is likely to be challenged in court.

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Small Geographic Area Variations in Prescription Drug Use

August 18, 2014 Comments off

Small Geographic Area Variations in Prescription Drug Use
Source: Pediatrics

BACKGROUND: Despite the frequency of pediatric prescribing little is known about practice differences across small geographic regions and payer type (Medicaid and commercial).

OBJECTIVE: The goal of this research was to quantify variation in prescription drug use among northern New England children.

METHODS: Northern New England, all-payer administrative data (2007–2010) permitted study of prescriptions for 949 821 children ages 0 to 17 years (1.75 million person-years [PYs]; 54% Medicaid, 46% commercial). Age- and gender adjusted overall and drug group–specific prescription use was quantified according to payer type (Medicaid or commercial) and within payer type across 69 hospital service areas (HSAs). We measured prescription fills per PY (rate) and annual, mean percentage of the population with any drug group–specific fills (prevalence).

RESULTS: Overall mean annual prescriptions per PY were 3.4 (commercial) and 5.5 (Medicaid). Generally, these payer type differences were smaller than HSA-level variation within payer type. HSA-level rates of attention-deficit/hyperactivity disorder drug use (5th–95th percentile) varied twofold in Medicaid and more than twofold in commercially insured children; HSA-level antidepressant use varied more than twofold within each payer type. Antacid use varied threefold across HSAs and was highest in infants where commercial use paradoxically exceeded Medicaid. Prevalence of drug use varied as much as rates across HSAs.

CONCLUSIONS: Prescription use was higher among Medicaid-insured than commercially insured children. Regional variation generally exceeded payer type differences, especially for drugs used in situations of diagnostic and therapeutic uncertainty. Efforts should advance best pediatric prescribing discussions and shared decision-making.

Attitudes toward Health Insurance and Their Persistence over Time, Adults, 2010-2011

August 13, 2014 Comments off

Attitudes toward Health Insurance and Their Persistence over Time, Adults, 2010-2011
Source: Agency for Healthcare Research and Quality

Highlights

  • In 2011, 12.1 percent of adults agreed with the statement “I’m healthy enough that I really don’t need health insurance,” and 24.3 percent of adults agreed with the statement “Health insurance is not worth the money it costs.”
  • There were no differences in the overall national estimates when comparing the 2011 attitudes towards the cost of health insurance with those observed in 2010; however, substantial shifts in preferences were noted for the same individuals over this time period.
  • Adults ages 18-64 who were uninsured for all of 2011 were nearly twice as likely as their privately insured counterparts, and two and one-half times as likely as those with public coverage to indicate they were healthy and did not need health insurance. These uninsured adults were also more likely to agree that health insurance was not worth its cost, relative to those with coverage.
  • Adults with consistent attitudes toward health insurance in both 2010 and 2011 had coverage and utilization behaviors in accordance with their expressed preferences. Those who consistently said they were healthy and did not need coverage were more than three times as likely not to have any medical expenditures in both years, relative to those who consistently disagreed with that classification.
  • In both years, adults under age 65 who consistently indicated that health insurance was not worth the cost were nearly three times as likely to be uninsured relative to those who consistently disagreed.

Arkansas, Kentucky Report Sharpest Drops in Uninsured Rate; Medicaid expansion, state exchanges linked to faster reduction in uninsured rate

August 13, 2014 Comments off

Arkansas, Kentucky Report Sharpest Drops in Uninsured Rate; Medicaid expansion, state exchanges linked to faster reduction in uninsured rate
Source: Gallup

Arkansas and Kentucky lead all other states in the sharpest reductions in their uninsured rate among adult residents since the healthcare law’s requirement to have insurance took effect at the beginning of the year. Delaware, Washington, and Colorado round out the top five. All 10 states that report the largest declines in uninsured rates expanded Medicaid and established a state-based marketplace exchange or state-federal partnership.

Health Reform and Changes in Health Insurance Coverage in 2014

August 13, 2014 Comments off

Health Reform and Changes in Health Insurance Coverage in 2014
Source: New England Journal of Medicine

In this analysis of nationally representative survey data from January 2012 through June 2014, we found a significant decline in the uninsured rate among nonelderly adults that coincided with the initial open-enrollment period under the ACA. These changes remained highly significant after adjustment for potential confounders such as employment, demographic characteristics, and income. As compared with the baseline trend, the uninsured rate declined by 5.2 percentage points by the second quarter of 2014, a 26% relative decline from the 2012–2013 period. Combined with 2014 Census estimates of 198 million adults 18 to 64 years of age,19 this corresponds to 10.3 million adults gaining coverage, although depending on the model and confidence intervals, our sensitivity analyses imply a wide range from 7.3 to 17.2 million adults.

The pattern of coverage gains was consistent with the effects of the ACA, with major gains for persons likely to be eligible for expanded Medicaid on the basis of their income and state of residence but smaller and nonsignificant changes for low-income adults in states without Medicaid expansion. Coverage gains were significant both in states with Medicaid expansion and in those without Medicaid expansion for persons with incomes between 139% and 400% of the federal poverty level, which is consistent with tax subsidies under the ACA for private insurance in this income range, regardless of state decisions regarding Medicaid expansion. Absolute gains were largest among young adults and Hispanics, two groups with high uninsured rates at baseline. State-level estimates of coverage gains were significantly associated with official HHS enrollment statistics, showing that each percentage point of the state population enrolling via the marketplaces was associated with a half-point decline in the uninsured rate. Nonetheless, the inherent lack of a control group precludes a causal interpretation for these findings, and other unmeasured factors may have contributed to these changes.

Paychecks or Promises? Lessons from the Death Spiral of Detroit

August 12, 2014 Comments off

Paychecks or Promises? Lessons from the Death Spiral of Detroit
Source: Federal Reserve Bank of Minneapolis

Pay-with-promises compensation plans accumulate liability for future employee benefits, such as retiree health insurance. A simple economic model demonstrates that such plans can exacerbate fiscal crises faced by cities that experience external economic shocks, such as the departure of a major employer. City leaders often raise taxes and/or reduce public services to pay off legacy employee debts, and such steps encourage residents to move out, reducing the tax base and raising fiscal stress. Pay-as-you-go compensation plans are more prudent; they settle liabilities to employees paycheck by paycheck.

Relationship of Income and Health Care Coverage to Receipt of Recommended Clinical Preventive Services by Adults — United States, 2011–2012

August 12, 2014 Comments off

Relationship of Income and Health Care Coverage to Receipt of Recommended Clinical Preventive Services by Adults — United States, 2011–2012
Source: Morbidity and Mortality Weekly Report (CDC)

Each year in the United States, an estimated 100,000 deaths could be prevented if persons received recommended clinical preventive care. The Affordable Care Act has reduced cost as a barrier to care by expanding access to insurance and requiring many health plans to cover certain recommended preventive services without copayments or deductibles. To establish a baseline for the receipt of these services and to begin monitoring the effects of the law, CDC analyzed responses from persons aged ≥18 years in the National Health Interview Survey (NHIS) for the years 2011 and 2012 combined. This report summarizes the findings for six services covered by the Affordable Care Act. Among the six services examined, three were received by less than half of the persons for whom they were recommended (testing for human immunodeficiency virus [HIV] and vaccination for influenza and zoster [shingles]). Having health insurance or a higher income was associated with higher rates of receiving these preventive services, affirming findings of previous studies. Securing health insurance coverage might be an important way to increase receipt of clinical preventive services, but insurance coverage is not all that is needed to ensure that everyone is offered and uses clinical services proven to prevent disease. Greater awareness of Affordable Care Act provisions among public health professionals, partners, health care providers, and patients might help increase the receipt of recommended services.

TIGTA Issues Report On Accuracy Of Information And Family Size Verification Requests (ACA)

August 5, 2014 Comments off

TIGTA Issues Report On Accuracy Of Information And Family Size Verification Requests
Source: Treasury Inspector General for Tax Administration

The Internal Revenue Service (IRS) is generally providing accurate income and family size information to Health Insurance Exchanges for use in determining eligibility of individuals for health insurance and the Advance Premium Tax Credit, according to a new report from the Treasury Inspector General for Tax Administration (TIGTA).

Beginning Jan. 1, 2014, most individuals must obtain health insurance that meets minimum requirements. Health Insurance Exchanges are intended to provide a place for Americans to shop for health insurance. Qualified individuals may request the Premium Tax Credit to assist with paying for health insurance. The credit may be paid directly to individual’s health insurance provider as a partial payment for their monthly premiums. This is known as the Advance Premium Tax Credit (APTC).

This audit was initiated to ensure that the IRS is providing accurate information to the Exchanges to assist in determining an individual’s eligibility to use the Exchange and receive the APTC.

“In nearly all instances, the IRS correctly provided accurate information to the Health Exchanges on income and family sizes,” said J. Russell George, Treasury Inspector General for Tax Administration. “Accurate information is essential for an Exchange to determine if an applicant is eligible to obtain insurance coverage through the Exchange.”

TIGTA’s review of the IRS’s response to 101,018 Income and Family Size Verification information requests between Oct. 1 and Oct. 4, 2013 showed that the IRS, based on the information provided by the Exchange, provided accurate responses for 100,985 (99.7) percent of the 101,018 requests.

State Differences in the Cost of Job-Related Health Insurance, 2013

August 5, 2014 Comments off

State Differences in the Cost of Job-Related Health Insurance, 2013
Source: Agency for Healthcare Research and Quality

This Statistical Brief presents state variations from the national average of the cost of job-related health insurance and how these costs are shared by employers and their employees. The Brief specifically examines the average premiums and employee contributions for private-sector establishments in the 10 most populous states in 2013, using the most recent data available from the Insurance Component of the Medical Expenditure Panel Survey (MEPS-IC).

Out-of-Pocket Health Care Expenses by Age and Insurance Coverage, 2011

July 29, 2014 Comments off

Out-of-Pocket Health Care Expenses by Age and Insurance Coverage, 2011
Source: Agency for Healthcare Research and Quality

Highlights

  • In 2011, an average of $703 was paid out of pocket for health care among people with some health care expenses. However, the median out-of-pocket amount was notably lower ($237).
  • Nearly one-fifth of people with some health care expenses had out-of-pocket expenses greater than $1,000 while 8.2 percent had out-of-pocket expenses greater than $2,000.
  • Average out-of-pocket expenses increased with age, ranging from $283 for children under 18 to $1,215 for people age 65 and older.
  • On average, the uninsured paid nearly two-thirds of their health care expenses out of pocket while people under age 65 covered by public insurance and people age 65 and older covered by Medicare and other public insurance paid a substantially lower percentage (only 9–11 percent).

Upcoming Federal Court Decision Could Mean Premium Increases for Nearly 5 Million Americans

July 23, 2014 Comments off

Upcoming Federal Court Decision Could Mean Premium Increases for Nearly 5 Million Americans
Source: Avalere Health

A new analysis from Avalere Health finds that without action from the federal government nearly 5 million Americans would receive an average premium increase of 76 percent if the courts ultimately rule that consumers in the federal exchange cannot receive premium subsidies.

Halbig v. Burwell asserts that the Internal Revenue Service exceeded its authority in issuing a May 2012 rule that provides premium subsidies to individuals purchasing coverage through the federally facilitated exchange. While the ACA specifies that subsidies should be administered “through an exchange established by the state,” the law also gives the federal government the authority to establish an exchange on the state’s behalf. Only 16 states and the District of Columbia opted to create their own exchanges in time for the 2014 plan year.

“The court case has major implications for future insurance coverage and access to care for millions of Americans,” said Caroline Pearson, vice president at Avalere Health. “Depending on the ultimate decision by the courts and absent some other remedy, individuals in at least 25 states who remain in their current plans could see an average premium increase of over 70 percent.”

New From the GAO

July 21, 2014 Comments off

New GAO Reports
Source: Government Accountability Office

1. Consumer Finance: Credit Cards Designed for Medical Services Not Covered by Insurance. GAO-14-570, June 19.
http://www.gao.gov/products/GAO-14-570
Highlights – http://www.gao.gov/assets/670/664256.pdf
Podcast – http://www.gao.gov/multimedia/podcasts/664738

2. State Department: Implementation of Grants Policies Needs Better Oversight. GAO-14-635, July 21.
http://www.gao.gov/products/GAO-14-635
Highlights – http://www.gao.gov/assets/670/664905.pdf

3. African Growth and Opportunity Act: Observations on Competitiveness and Diversification of U.S. Imports from Beneficiary Countries. GAO-14-722R, July 21.
http://www.gao.gov/products/GAO-14-722R

Halbig v Burwell: Potential Implications for ACA Coverage and Subsidies

July 18, 2014 Comments off

Halbig v Burwell: Potential Implications for ACA Coverage and Subsidies
Source: Robert Wood Johnson Foundation

A new report quantifies what’s at stake—in terms of health coverage and dollars—in the Halbig v. Burwell decision expected soon. Urban Institute researchers estimate that 7.3 million people, or about 62 percent of the 11.8 million people expected to enroll in federally facilitated marketplaces by 2016, could lose out on $36.1 billion in subsidies. Residents in Texas and Florida would lose the most, $5.6 billion and $4.8 billion respectively in subsidies at risk in this court decision.

Selection and Costs for Employer-Sponsored Health Insurance in the Private Sector, 2013 versus 2012

July 18, 2014 Comments off

Selection and Costs for Employer-Sponsored Health Insurance in the Private Sector, 2013 versus 2012
Source: Agency for Healthcare Research and Quality (Medical Expenditure Panel Survey)

Highlights

  • In 2013, 51.3 percent of private-sector employees enrolled in employer-sponsored health insurance chose single coverage, rather than employee-plus-one or family coverage. This percentage did not differ from that for 2012.
  • Average annual total premiums across all three coverage types were up in 2013 compared to 2012. Single premiums rose 3.5 percent, employee-plus-one premiums rose 3.5 percent, and family premiums rose 3.6 percent.
  • The average annual dollar amount that employees contributed toward the premium also rose for all three types of coverage in 2013 versus 2012.

Use of Aspirin for Primary and Secondary Cardiovascular Disease Prevention in the United States, 2011–2012

July 16, 2014 Comments off

Use of Aspirin for Primary and Secondary Cardiovascular Disease Prevention in the United States, 2011–2012
Source: Journal of the American Heart Association

Background
Aspirin use has been shown to be an effective tool in cardiovascular disease (CVD) prevention among high‐risk patients. The patient‐reported physician recommendation for aspirin as preventive therapy among high‐ and low‐risk patients is unknown.

Methods and Results
We conducted an analysis of the National Health and Nutrition Examination Survey 2011–2012 to examine the use of aspirin for CVD prevention. Patients without previously diagnosed CVD were classified into high and low risk based on their Framingham Risk Score (10‐year coronary heart disease risk). Among patients without previously diagnosed CVD, 22.5% were classified as high risk. Of the high‐risk individuals, 40.9% reported being told by their physician to take aspirin, with 79.0% complying. Among those who were at low risk, 26.0% were told by their physician to take aspirin, with 76.5% complying. Logistic regression analysis indicated that age, access to a regular source of care, education, and insurance status were significant predictors of patient‐reported physician recommendations for aspirin use for primary prevention. Among high‐risk patients, age, race, and insurance status were significant predictors of reported recommendations for aspirin use. Among low‐risk patients, age, education, obesity, and insurance status were significant predictors of reported recommendations for aspirin use.

Conclusions
Patient reports indicate nonideal rates of being told to take aspirin, for both high‐ and low‐risk patients for primary prevention. Clinical decision support tools that could assist physicians in identifying patients at risk may increase patient reports of physician recommendations for aspirin use.

CRS — Low-Income Assistance Programs: Trends in Federal Spending

July 16, 2014 Comments off

Low-Income Assistance Programs: Trends in Federal Spending (PDF)
Source: Congressional Research Service (via University of North Texas Digital Library)

This report examines the spending trends of 10 major need-tested benefit programs or groups of programs: (1) health care from Medicaid and the Children’s Health Insurance Program (CHIP); (2) the refundable portion of the health insurance tax credit enacted in the 2010 health care reform law; (3) the Supplemental Nutrition Assistance Program (SNAP); (4) assisted housing; (5) financial assistance for post-secondary students (Pell Grants); (6) compensatory education grants to school districts; (7) the Earned Income Tax Credit (EITC); (8) the Additional Child Tax Credit (ACTC); (9) Supplemental Security Income (SSI); and (10) Family Support Payments. The common feature of need-tested programs is that they provide benefits, services, or funding based on a measure of limited financial resources (income and sometimes assets). However, other than that common feature, the programs differ considerably in their target populations, services, and focus.

New Report Shows High-Value Provider Networks Maximize Quality, Affordability for Consumers

July 14, 2014 Comments off

New Report Shows High-Value Provider Networks Maximize Quality, Affordability for Consumers
Source: America’s Health Insurance Plans (AHIP)

High-value provider networks are part of a broad array of strategies health plans use to maximize health care affordability and quality, and a new analysis from actuarial firm Milliman for America’s Health Insurance Plans (AHIP) offers additional insight into how health plans develop these networks to improve care delivery and value. The report finds that high-value provider networks allow for more affordable coverage options with 5% to 20% lower premiums compared to broader network plans, while placing an emphasis on the quality and effectiveness of providers.

To achieve high quality and cost-effective care, health plans’ high-value network designs are focused on delivering care through more efficient treatment protocols, which resulting in the elimination of wasteful spending. In that regard, these initiatives address the cost and quality challenges in a comprehensive way—not simply though implementing smaller or narrower provider networks.

While health plans continue to offer broader coverage options, creating high-value networks—or contracting with a select number of providers who meet quality, cost, and effectiveness metrics—is one way health plans address the wide variation in the price of services and care delivery. In addition, the report highlights that high-value provider networks are “specifically geared toward providing personal and comprehensive care to patients in an environment where providers effectively communicate and coordinate with each other regarding the best treatment for the patient.”

The ACA and America’s Cities: Fewer Uninsured and More Federal Dollars

July 14, 2014 Comments off

The ACA and America’s Cities: Fewer Uninsured and More Federal Dollars
Source: Urban Institute

This report estimated the effect of the Affordable Care Act (ACA) on 14 large and diverse cities: Los Angeles, Chicago, Houston, Philadelphia, Phoenix, Indianapolis, Columbus, Charlotte, Detroit, Memphis, Seattle, Denver, Atlanta, and Miami. For each city we estimated changes in health coverage under the ACA, particularly the resulting decline in the uninsured. We also estimated the additional federal spending on health care that would flow into these cities. For cities in states that have not expanded Medicaid eligibility, we provide estimates both with and without expansion.

See also: Increase in Medicaid under the ACA Reduces Uninsurance, According to Early Estimates

Gaining Ground: Americans’ Health Insurance Coverage and Access to Care After the Affordable Care Act’s First Open Enrollment Period

July 14, 2014 Comments off

Gaining Ground: Americans’ Health Insurance Coverage and Access to Care After the Affordable Care Act’s First Open Enrollment Period
Source: Commonwealth Fund

A new Commonwealth Fund survey finds that in the wake of the Affordable Care Act’s first open enrollment period, significantly fewer working-age adults are uninsured than just before the sign-up period began, and many have used their new coverage to obtain needed care.

The uninsured rate for people ages 19 to 64 declined from 20 percent in the July-to-September 2013 period to 15 percent in the April-to-June 2014 period. An estimated 9.5 million fewer adults were uninsured. Young men and women drove a large part of the decline: the uninsured rate for 19-to-34-year-olds declined from 28 percent to 18 percent, with an estimated 5.7 million fewer young adults uninsured. By June, 60 percent of adults with new coverage through the marketplaces or Medicaid reported they had visited a doctor or hospital or filled a prescription; of these, 62 percent said they could not have accessed or afforded this care previously.

New From the GAO

July 10, 2014 Comments off

New GAO Report
Source: Government Accountability Office

Private Health Insurance: Early Effects of Medical Loss Ratio Requirements and Rebates on Insurers and Enrollees. GAO-14-580, July 10.
http://www.gao.gov/products/GAO-14-580
Highlights – http://www.gao.gov/assets/670/664720.pdf

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