ZPolitics Publishes Foundation Article on ObamaCare at 6

It’s fortunate. Georgia is among 27 states that left ObamaCare to the federally managed health care exchange, www.healthcare.gov.  About half the state-managed exchanges are struggling financially. Georgia is also among 20 states that chose not to expand Medicaid, citing the cost.

Georgia’s uninsured rate dropped from 18.5 percent in 2013 to 17.5 percent in 2014, according to the Kaiser Family Foundation. Most credit both the economic recovery and ObamaCare. But ObamaCare’s “mandate” does not mean universally required coverage. The IRS reported 7.5 million Americans paid penalties for lacking health insurance in 2014, but another 12 million claimed an exemption from buying insurance.

Here are six things to know about Georgia and the Affordable Care Act at age 6.

1) The system’s gamed

ACA open enrollment ended January 31 and 587,845 Georgians enrolled or renewed plans; only Florida, Texas and North Carolina saw more. The question is how many will remain enrolled. When 2015 enrollment ended (February 15), 541,080 Georgians had coverage. By the end of March that number had dropped to 452,815. By the end of June, it was 417,890 – a 23 percent plunge.

Reasons cited include tougher enforcement of income and citizenship status, as well as people who enrolled then didn’t pay premiums. IRS penalties remain less than premiums, however, so many take the gamble. Besides, the IRS can only exact penalties from taxpayers who have tax refunds coming.

2) Options change

Georgia had five insurance carriers in 2014 and nine in 2015 and 2016. Time Insurance (Assurant) exited Georgia and nationwide at the end of 2015 after losing $368 million, but Harken came in. Insurers remain watchful; UnitedHealth Group is evaluating its participation after 2016. Among the problems: fewer enrollments and higher costs from enrollments outside the window, typically ailing patients with high claims that premium revenue can’t cover. Insurers responded by reducing or eliminating commissions on such signups; the Georgia Legislature is reacting by mandating commission levels.

3) ‘Woodwork’ effect

For states expanding Medicaid to cover more low-income residents under ObamaCare, the federal government pays 100 percent of qualified enrollees’ costs from 2014-16; by 2020 that subsidy drops to 90 percent. (Bear in mind: Subsidies, whether state or federal, come from taxpayers’ pockets.)

Although Georgia did not expand Medicaid, education and awareness increased currently eligible beneficiaries. Georgia’s cost share is about one-third for enrollees from this “woodwork effect;” the ACA does not cover them. Medicaid costs rose 15.7 percent from fiscal years 2013-17, to $3.1 billion.

4) ‘Affordable’ coverage?

Remember President Obama’s 2009 promise of a law “that will cover every American and cut the cost of a typical family’s premium by up to $2,500 a year”? The Manhattan Institute’s 2014ObamaCare Impact Map examined enrollees’ cost of insurance before and after the law took effect. It found increases ranging from 64-108 percent for women and 81-179 percent for men in Georgia. For a 27-year-old male, for example, monthly premiums went from $82.30 to $229.

5) Protectionism and politics

Politics hinders other affordable options:

• A bill that enables physician direct-pay care by confirming the practice is exempt from onerous regulation as health insurance is foundering
• A bill passed to eliminate a cost-effective, innovative online vision care service currently operating in Georgia
• At the behest of dentists, legislators rejected legislation to allow dental hygienists to operate without direct supervision in safety-net settings; currently, 118 of Georgia’s 159 counties lack sufficient dental professionals
• Legislation failed that would eliminate certificate-of-need requirements, potentially lowering costs by increasing competition and services
• At the federal level, more media attention is given to opposition than to proposed alternatives. Georgia Congressman Tom Price’s legislation, evolving since its introduction in 2009, leads them and is projected to save $1.7 trillion

6) Coverage isn’t care

Georgia has been criticized for not expanding Medicaid coverage. But coverage is not care, and low-income Georgians deserve better care. The well-known Oregon Health Insurance Experiment found “Medicaid increased health care utilization, reduced financial strain, and reduced depression, but produced no statistically significant effects on physical health.” A study of Medicaid expansion enrollees in Kentucky and Arkansas reported greater access to health care but no sense of change in their physical and mental health.

More than 300,000 Georgians are in the “coverage gap,’’ earning too much too much to qualify for Medicaid under current eligibility rules but not enough for subsidized plans under ObamaCare. The Georgia Public Policy Foundation has outlined a market-oriented way to provide them health care. In the private sector, businesses assume the risk. Unfortunately, when government can reach into taxpayer pockets, there is little incentive for improvement in cost, quality or efficiency.

It’s fortunate. Georgia is among 27 states that left ObamaCare to the federally managed health care exchange, www.healthcare.gov.  About half the state-managed exchanges are struggling financially. Georgia is also among 20 states that chose not to expand Medicaid, citing the cost.

Georgia’s uninsured rate dropped from 18.5 percent in 2013 to 17.5 percent in 2014, according to the Kaiser Family Foundation. Most credit both the economic recovery and ObamaCare. But ObamaCare’s “mandate” does not mean universally required coverage. The IRS reported 7.5 million Americans paid penalties for lacking health insurance in 2014, but another 12 million claimed an exemption from buying insurance.

Here are six things to know about Georgia and the Affordable Care Act at age 6.

1) The system’s gamed

ACA open enrollment ended January 31 and 587,845 Georgians enrolled or renewed plans; only Florida, Texas and North Carolina saw more. The question is how many will remain enrolled. When 2015 enrollment ended (February 15), 541,080 Georgians had coverage. By the end of March that number had dropped to 452,815. By the end of June, it was 417,890 – a 23 percent plunge.

Reasons cited include tougher enforcement of income and citizenship status, as well as people who enrolled then didn’t pay premiums. IRS penalties remain less than premiums, however, so many take the gamble. Besides, the IRS can only exact penalties from taxpayers who have tax refunds coming.

2) Options change

Georgia had five insurance carriers in 2014 and nine in 2015 and 2016. Time Insurance (Assurant) exited Georgia and nationwide at the end of 2015 after losing $368 million, but Harken came in. Insurers remain watchful; UnitedHealth Group is evaluating its participation after 2016. Among the problems: fewer enrollments and higher costs from enrollments outside the window, typically ailing patients with high claims that premium revenue can’t cover. Insurers responded by reducing or eliminating commissions on such signups; the Georgia Legislature is reacting by mandating commission levels.

3) ‘Woodwork’ effect

For states expanding Medicaid to cover more low-income residents under ObamaCare, the federal government pays 100 percent of qualified enrollees’ costs from 2014-16; by 2020 that subsidy drops to 90 percent. (Bear in mind: Subsidies, whether state or federal, come from taxpayers’ pockets.)

Although Georgia did not expand Medicaid, education and awareness increased currently eligible beneficiaries. Georgia’s cost share is about one-third for enrollees from this “woodwork effect;” the ACA does not cover them. Medicaid costs rose 15.7 percent from fiscal years 2013-17, to $3.1 billion.

4) ‘Affordable’ coverage?

Remember President Obama’s 2009 promise of a law “that will cover every American and cut the cost of a typical family’s premium by up to $2,500 a year”? The Manhattan Institute’s 2014ObamaCare Impact Map examined enrollees’ cost of insurance before and after the law took effect. It found increases ranging from 64-108 percent for women and 81-179 percent for men in Georgia. For a 27-year-old male, for example, monthly premiums went from $82.30 to $229.

5) Protectionism and politics

Politics hinders other affordable options:

• A bill that enables physician direct-pay care by confirming the practice is exempt from onerous regulation as health insurance is foundering
• A bill passed to eliminate a cost-effective, innovative online vision care service currently operating in Georgia
• At the behest of dentists, legislators rejected legislation to allow dental hygienists to operate without direct supervision in safety-net settings; currently, 118 of Georgia’s 159 counties lack sufficient dental professionals
• Legislation failed that would eliminate certificate-of-need requirements, potentially lowering costs by increasing competition and services
• At the federal level, more media attention is given to opposition than to proposed alternatives. Georgia Congressman Tom Price’s legislation, evolving since its introduction in 2009, leads them and is projected to save $1.7 trillion

6) Coverage isn’t care

Georgia has been criticized for not expanding Medicaid coverage. But coverage is not care, and low-income Georgians deserve better care. The well-known Oregon Health Insurance Experiment found “Medicaid increased health care utilization, reduced financial strain, and reduced depression, but produced no statistically significant effects on physical health.” A study of Medicaid expansion enrollees in Kentucky and Arkansas reported greater access to health care but no sense of change in their physical and mental health.

More than 300,000 Georgians are in the “coverage gap,’’ earning too much too much to qualify for Medicaid under current eligibility rules but not enough for subsidized plans under ObamaCare. The Georgia Public Policy Foundation has outlined a market-oriented way to provide them health care. In the private sector, businesses assume the risk. Unfortunately, when government can reach into taxpayer pockets, there is little incentive for improvement in cost, quality or efficiency.

Benita Dodd is vice president of the Georgia Public Policy Foundation.