Health Care News and Views
Compiled by Benita M. Dodd
Open enrollment began Sunday for health care coverage for 2016 under ObamaCare. Unfortunately, about 740,000 people insured through federally funded co-ops must find new health homes. They won’t have coverage because 12 of the 23 co-ops – “consumer operated and oriented plans” – are shutting their doors.
Since October 1, seven co-ops in Tennessee, Kentucky, Oregon, Colorado, South Carolina, Utah and Arizona have announced they will not be selling insurance in 2016. Four more in Iowa, Louisiana, Nevada and New York told consumers earlier this year. On Tuesday, Michigan’s co-op added its name to the list.
What’s the company line? “If a co-op has solvency issues, and we cannot rule out that others may this year, we will work with the states so that consumers have affordable options on the marketplace,” said Department of Health and Human Services spokesman Aaron Albright. “As a startup business, we recognize not all will succeed.”
“Any start-up faces the inherent risks of building a business from the ground up,” Dr. Mandy Cohen, the chief operating officer at the Centers for Medicare and Medicaid Services, told Congressional lawmakers at a hearing this week. “As with any new set of business ventures, some co-ops have succeeded while others have encountered more challenges.”
Therein lies the rub: These “startup businesses” weren’t funded by entrepreneurs risking their own money. They were funded by taxpayers. The government allocated $2.4 billion in loans in 23 states to these nonprofit health plans, which were seen as a way to provide competitive consumer choices in states with big commercial carriers.
U.S. Rep. Diane Black (R-Tenn.) believes she knows why they failed: “The reason why they work [in other sectors] is because everyone has skin in the game. It’s not taxpayer dollars. It doesn’t come from some dropping of dollars out of the sky. It works because everybody that’s in it has something in the skin of the game. Here we have taxpayer dollars to the point of $2.4 billion, and that’s a real concern.”
According to the New York Times, the reasons included higher-than-expected enrollment of people with expensive health problems, lower-than-expected enrollment of younger people, and inaccurate pricing of coverage. One example: The Kentucky plan lost $50 million last year, more than any other insurance co-op, as it paid out $1.25 in claims for every dollar it collected in premiums.
Democrats blame Republicans. The plan was to allocate about $6 billion to the co-ops; GOP opposition led to a reduction and the final figure was $2.4 billion in loans. Any bets on whether taxpayers will see any money paid back? The tragedy about the Affordable Care Act is the co-ops went under because they couldn’t afford to stay in business. And you can bet consumers will see higher premiums on the “open” market.
In other ACA news: Federal health officials announced they are introducing a feature on HealthCare.gov on an experimental basis: a tool that will let insurance-shoppers search which Affordable Care Act health plans in their area cover the doctors and health-care facilities they prefer. Source: Washington Post
Missed the 6th Annual Georgia Legislative Policy Forum? Health care was one of the topics and Foundation President Kelly McCutchen interviewed John Goodman, the “father of Health Savings Accounts.” It’s worth it to see the options available to Georgia. Keynote speaker Ross Mason, meanwhile, discussed the state’s potential to take the lead in innovation! Find links to their discussions here.
Right to try: On Halloween, I published some thoughts about why terminally ill Georgians deserve the right to try experimental drugs. You can read about it here.
Drug costs: Because lowering the price of health care worked so well for the Obama administration (said no one ever) the Obama administration has announced it will hold a forum this month on the high prices of some prescription drugs. “The move came amid reports of price manipulation and opinion polls that identify drug prices as a top concern for many consumers and voters,” reports The New York Times. “Hillary Rodham Clinton and other Democrats have called for efforts to stop what they call price gouging by drug makers. Senior House Democrats are forming a panel to explore possible legislation on drug pricing.”
Drug savings: Medicare rarely covers prescriptions. But retirees can find ways to save on prescription drugs, and an article in the Baltimore Sun makes an important point: When you’re shopping for a plan, don’t just look at premiums. “Find out whether your drugs are on the plan’s formulary (its list of covered drugs) and how the drugs are covered. Some plans have you pay 40 percent to 50 percent of the cost of certain brand-name drugs, which could be hundreds of dollars, even if your drugs are covered.”
Houston, we have a problem: Nearly six in 10 Americans over age 20 (59 percent) took at least one prescription drug in 2012, up from 51 percent the year earlier. Obesity is viewed as a primary cause for the increase, The Los Angeles Times reports. No. 1 was simvastatin (Zocor), a cholesterol-lowering drug that was taken by 8 percent of Americans. The other top 10 medications were lisinopril (an ACE inhibitor used for high blood pressure and heart failure), levothyroxine (a thyroid hormone), metoprolol (a beta-blocker that treats high blood pressure, chest pain and heart failure), metformin (prescribed to treat type 2 diabetes), hydrochlorothiazide (a blood pressure medication), omeprazole (to treat stomach ulcers, heartburn and gastroesophageal reflux disease ), amlodipine (a calcium channel blocker that improves blood pressure and reduces chest pain), atorvastatin (the statin sold as Lipitor) and albuterol (a bronchodilator for people with asthma or other breathing problems).
Healthy, wealthy … : In the second year after being diagnosed with cancer, survivors were earning up to 40 percent less than they had been before they became sick, on average. Even in the fifth year after diagnosis, annual earnings still had not recovered to their precancer levels, researchers reported this week in the journal Cancer. Relatives helped fill that gap, the researchers reported. The findings likely have something to do with the finding that, “The probability of a cancer patient being employed dropped by almost 10 percentage points, and hours worked declined by up to 200 hours in the first year after diagnosis.”
A shot in the dog: It’s the luck of the draw when reading the University of Georgia Research magazine. The current issue (fall 2015) includes an article on the global warming carbon “threat to our climate” posed by permafrost thawing and another on how we’re doomed because of the planet’s excessive consumption of biomass. (IMHO, higher carbon dioxide levels in the atmosphere would increase plant growth so the first effect would cancel out the second.) But I digress. What really caught my attention is the cover story, featuring research on how a dog virus helps create human vaccines. (The edition isn’t online yet.) The PIV5 virus (parainfluenza) found in dogs doesn’t affect humans, unlike some viruses that destroy host cells in the body and cause telltale signs of infection. UGA Professor Biao He has made this “safe” virus a vaccine platform, “using it as a messenger that carries genetic information about diseases to the immune system without causing harm in the process,” The scientist is using already used PIV5 to create a therapeutic vaccine for rabies and hopes it will help create an HIV vaccine. Even more interesting: He devised a custom-made cancer vaccine for a dog suffering from soft-tissue carcinoma. “After treatment with a PIV5 vaccine that taught the dog’s immune system to seek out and destroy the animal’s specific cancer cells, veterinarians were stunned by the result. The tumor decreased in size by more than 50 percent and was not detectable on subsequent incisional biopsies,” said Corey Saba, an associate professor of oncology at UGA’s College of Veterinary Medicine. Good dog virus!
Benita M. Dodd is vice president of the Georgia Public Policy Foundation.
The Georgia Public Policy Foundation is a driving force for market-based solutions to policy challenges. The work done by this outstanding organization is making a real impact on the future of Georgia. I personally consider the Foundation a primary source for policy ideas. All Georgians are better off because the Foundation is helping lead the critical policy debates in our state.