SCOTUS

Ever since its controversial passage in 2010, the Affordable Care Act has been plastered with a range of polemic labels. Critics say Obamacare is job-killing; supporters herald it as life-saving.

Here’s another, perhaps unexpected label: personally profitable.

If you were among the true believers in the law a year ago today, there was easy money to be made. Nearly 80% of bettors on InTrade expected the law to be found unconstitutional; strategically spending about $25 in favor of the ACA could’ve netted you $800, based on how InTrade’s short-selling rules worked.

Much has changed, certainly, since Chief Justice John Roberts cast the deciding vote to uphold the law. (Beyond those bettors’ account balances, and the existence of InTrade itself, which mysteriously shut down in March.)

Here’s a look at how the Supreme Court’s decision on June 28, 2012, affected five hot-button issues related to the health law.

States’ decisions on Medicaid expansion

As of June 27, 2012: Several states with progressive governors and legislatures, like California, had moved to expand Medicaid ahead of the Supreme Court’s ruling. The Golden State’s leaders also had pledged to pursue universal coverage if the ACA was ruled unconstitutional.

But most states were waiting on the resolution of the constitutionality battle.

Since June 28, 2012: After the Court’s decision that the mandate was constitutional but that the Medicaid expansion was optional for states — which “took everyone by surprise,” said Matt Salo, executive director of the National Association of Medical Directors — governors were suddenly forced to decide whether the expansion made financial, and political, sense. Within a week, about ten states had signaled they’d expand Medicaid under the ACA.

However, many wary governors chose to wait for the November elections, and the knowledge of who would hold the White House, before announcing their plans; following President Obama’s reelection, a flurry of governors clarified their Medicaid stances throughout the winter and spring.

Continue reading “What’s Changed Since the Obamacare Verdict”

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I am an emergency room physician who has worked at Atlanta’s Grady Memorial Hospital for 17 years. I am also the first black woman to ever be hired as  a faculty member, and thus have had the opportunity  to teach students and doctors in training.  Given that 85% of the patients of the 120,000 patients that cross our threshold annually are black, my hiring carried enormous symbolic weight.

Beyond the symbolism, I’ve found a real effect on patient care. There are a few earlier studies which suggest that patients prefer doctors who look like them if given the opportunity.

Though we can’t yet confirm that physicians and patients of the same race improve health for minorities , we can still argue that increasing diversity in the healthcare professions is a worthy goal.  We must move to a place where physicians can comfortably care for people of all cultures and patients can feel comfortable being cared for physicians from different cultures.

In my own experience, African-American grandmothers, mothers, sisters, aunts all want to give me a hug when they see me walk in the room to treat them or their loved ones: “Go ahead sister,” they might say, “we’re so glad and proud to see you”.   I have also had many black patients tell me they were more comfortable talking with me about their history of abuse or addiction.  That kind of rapport leads to better care and a healthier population.

If the Supreme Court had ruled in favor of Abigail Fisher in Fisher vs. The University of Texas today, which they did not, opportunities for physicians of color who could establish that rapport might have been significantly diminished.

To eliminate or significantly weaken affirmative action, which would have been the result of a Fisher victory, would deal a significant blow to the ability of undergraduate programs to recruit and create a diverse student population—some of whom will continue on to medical school. To be sure, that blow would weaken medical schools nationwide.

Continue reading “Why Affirmative Action Still Matters in Medicine. And Probably Always Will…”

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Now that the healthcare industry can work with clarity on care coordination strategies and programs, a new expansion of ACO models, trends in patient behavior and the companion issue of provider scope of practice have quickly emerged as critically-relevant spotlights. Historical perspective helps.

Simply put, even with the political tumult this fall, there is strong bipartisan support for aligning payment and care delivery models with improving quality to create a smarter and sustainable healthcare system, backed by historical precedent.

For me and my colleagues in the trenches of pursuing fiscally sound care delivery nearly a decade ago, it is well remembered that the origins of accountable care reside within a 2004 HHS document entitled “The Decade of Health Information Technology: Delivering Consumer-centric and Information-rich Health Care.” This “Framework for Strategic Action” (as it is also known) was delivered to then-HHS Secretary and GOP-appointee Tommy Thompson. And it was delivered by the nation’s first National Coordinator for Health Information Technology, Dr. David Brailer.

The document’s goals of introducing health IT solutions to clinical practices, electronically connecting clinicians, using “information tools” to personalize care and advance population health reporting followed an executive order calling for widespread adoption of interoperable EHRs within 10 years.

Continue reading “The Eight-Year Journey to Accountable Care”

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November 16 marks the deadline for states to submit their plans for establishing a health insurance exchange—or HIX—either on their own or with some level of assistance from the federal government. For those states, a majority, according to Kaiser Family Foundation research, have yet to set up a HIX or develop concrete plans to do so. That’s an uncomfortably tight timeline in which to make some tough decisions.

According to the Supreme Court’s June ruling on the Affordable Care Act, states will no longer forfeit federal funding for Medicaid if they choose not to expand their Medicaid programs to all residents with incomes below 138 percent of the federal poverty level. Nevertheless, they must ensure coverage for an estimated 16 million currently uninsured people with an income between 100 percent and 400 percent of that poverty level. And by October 2013, each state needs to demonstrate that it has a HIX in place that can provide such cover: A user-friendly, one-stop shop for affordable healthcare, or affirmatively state that it intends to participate in the Federal exchange..

A HIX needs to have sufficient scale to support large and balanced risk pools. But there may not be sufficient numbers of uninsured state residents to make the HIX viable, particularly if a state is small, or has an extensive Medicaid program already in place. How will such states attract and sustain enrollment? How will they attract payers?

Continue reading “Ensuring the Long-Term Viability of Health Insurance Exchanges”

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Thursday, when Chief Justice Roberts explained that the Affordable Care Act (ACA) is constitutional because the “penalty” that some Americans will have to pay is, for all practical purposes, a “tax,” you could hear tea cups shattering from Billings to Boca Raton. In conservative and libertarian circles, the initial reaction was shock, but it didn’t take long for President Obama’s opponents to rally.

The word “tax” might as well have been a pistol shot at a horse race. In the blink of an eye, Obama’s opponents were off and running, megaphones in hand, blasting the president for lying to the American people while hiking taxes under the guise of healthcare reform. Presidential candidate Mitt Romney’s campaign then began providing regular Twitter updates on the campaign contributions it was raking in following the decision. Friday, it announced that it had collected $5.5 million.

Will Republicans suceed in turning defeat into victory?

Sarah Palin is convinced that they will. On her Facebook page, she celebrated: “Thank you, SCOTUS. This Obamacare ruling fires up the troops as America’s eyes are opened.”   Palin, like Republican leader Mitch McConnell, believed that the Court’s ruling would galvanize Republic voters, sealing Romney’s victory in November.

This might be true if conservatives were not already so ardently committed to what McConnell has called his party’s “single most important” goal: “for President Obama to be a one-term president.”  As Democratic pollster Celinda Lake noted, “Republicans are already as energized as they can get.” It would be hard to turn up the dial on their passion. Opinion surveys have shown that Republican voters already were more motivated than Democrats to go to the polls this fall.   (In November, Obama’s challenge will be to get his supporters out, including those who are disillusioned that the president hasn’t done more to help the poor and the unemployed. )

Continue reading “What Will the Supreme Court Decision Mean For the November Election?”

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Now that the Supreme Court has spoken and upheld the Affordable Care Act (ACA), how exactly does this impact state governments?

One of the biggest ramifications of this decision revolves around the ACA’s individual mandate requiring citizens to purchase some form of health insurance or face a penalty, and the subsequent requirement for each state to establish a health insurance exchange (HIX).

While many states have spent the last two years preparing themselves in some capacity to set up an exchange, the amount of progress made varies greatly from state to state. Some have taken measureable strides to ensure their exchange is up and running to meet the October 2013 enrollments and January 2014 coverage effective deadlines set forth by the ACA, while others have been waiting on the final decision from the Court.  Now that it’s been made, we’re going to see these states in a scramble to build their HIXs in accordance with the ACA’s mandates and timeline.

What we’re hearing from our clients indicates the majority want to make health reform as state-specific as possible. In other words, they want to maintain control over their HIX rather than defaulting to the federal solution. But as the certification deadline looms, it’s increasingly important for states to consider a comprehensive solution that doesn’t require building a product and allows time for customization.

We have formally announced our Health Insurance Exchange solution, which enables us to provide a customizable HIX solution that states can tailor to meet the needs of their residents and small businesses and be sure it’s ready on time. We were recently awarded an ACA-compliant exchange in Nevada and also announced a partnership with Florida Health Choices to build Florida’s insurance marketplace.

Continue reading “Supreme Court Ruling: States Move Forward with Health Exchanges”

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The ruling upholding most of Obamacare was an as-yet-unappreciated boon for the GOP. A brilliant move by Roberts, he managed to preserve the remaining integrity of the court — and raise his own stature — while at the same time increasing the odds of a Romney win. How?  By recasting the mandate as that third-rail of politics, a tax.  Let’s dissect both these statements.

First, how can we be sure it wasn’t a major victory for Obama, pundits notwithstanding?  There is a “market” in presidential election predictions, www.intrade.com.  One may place bets on candidates and while, like the stock market, it is wrong sometimes, the “price” of each candidate does react to events. So, for instance, Rick Perry’s price fell 75% within seconds of his forgetting the name of the third cabinet department he was going to eliminate.  And yet, a full day after Obama’s “victory” the “price” his re-election chances still has not budged. It bumped briefly and has since fallen back to the same $5.40 (to win $10 if he wins—a 54% probability) that it’s been hovering at for weeks.

Second, was Roberts accurate, or just politically astute, in re-casting the mandate as a tax?   Answer:  The latter.

Continue reading “SCOTUS Ruling An Unappreciated Win for the GOP”

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By THCB STAFF

Defying predictions that the Obama administration would suffer a landmark political defeat, the US Supreme Court upheld the Affordable Care Act this morning. The implications for healthcare for the 2012 election are obviously nothing less than staggering.

What will the landmark legislation mean for the healthcare industry? For heath IT companies? For hospitals and health insurers?

We’ll be posting reactions from THCB analysts over the course of the day and in the days to come. In the meantime, if you have an opinion on the ruling, post your comments in the thread below.

If you can’t wait, you can download the ruling here in pdf format.

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The Supreme Court has upheld the Affordable Care Act (ACA), a frustrating situation in which conservatives won the policy battle, but lost the war over the Act.  In particular, the Court held that Congress cannot use the Commerce clause to compel commerce.  The individual mandate qua mandate is unconstitutional.  However, the Congress has the right to impose taxes (if not punitive and excessive), which permits the Obama administration to add a tax on millions of uninsured Americans in addition to the ACA’s already-massive tax burden on the middle class.

The Court ruled that a Medicaid expansion could be an unconstitutional federal coercion of the states, but this expansion does not have a penalty large enough to pass that threshold.  Interestingly, the Court opened up the possibility that governors could refuse the Medicaid expansion.  Those same individuals would then be eligible for subsidies in the exchanges.  If all the governors refused the expansion, and if individuals take up subsidized insurance the federal cost heads even farther north.

In a bit of a pyrrhic victory, the Forum’s amicus briefs, signed by over 200 economists, were cited twice in the Court’s dissenting opinion.  (See my amicus brief.)

The field of play now shifts from a legal battle to a policy debate.  In addition to the Court’s endorsement of the policy foundations of the challenge to the ACA, the fundamental policy flaws remain.

The ACA remains a damaging, anti-growth vehicle for taxation.  The so-called Medicare surtax increases marginal tax rates on the return to saving, investment, and innovation.  The medical device tax will hurt innovation and cost jobs.  A bill to repeal it is gathering dust in the Senate.  Also, the insurers fee – the “premium tax” – will roil insurance markets, disrupt patient-provider relationships, and the vast majority of the burden will fall on the middle class.

Continue reading “What The SCOTUS Ruling Means For Healthcare”

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The Supreme Court’s decision upholding the ACA is deliciously ironic. The “individual mandate”–an idea promoted for everyone in the 90s and for Massachusettians (?) in the 2000s by the arm of the Republican party known as the Heritage Foundation–was found to be legal. But not as a mandate, instead as a tax.

Put aside for a minute the dreadful political contortions required to get this quasi-universal health insurance bill past Congress in the first place. Put aside the fact that the supposedly non-political Supreme Court hands down decisions time after time that are a pure reflection of the exceedingly public extreme political views of its justices. Put aside for a minute the fact that the ACA has undeniably kickstarted a round of changes in the health care delivery and insurance system that at least has the potential to lower costs and improve care, and that the luncay of politics meant we nearly lost that momentum.

Instead focus on what the Supremes have done. They’ve cut through decades of rhetoric about how we pay for health insurance and clarified it thus: we pay for health care via taxes–whether they are private taxes on employers and employees (and now individuals) or public ones on citizens.

Continue reading “Heritage & Roberts decree, all the world be taxed”

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