Matthew Martin makes a very cogent point about CHIP reauthorization yesterday:
Underdiscussed: if the CHIP reauth was scored as deficit reducing over 10 years, that means there are lots of medicaid expansions we could do without needing payfors
— Matthew Very Stable Reinsurance Martin, LLC (@hyperplanes) January 23, 2018
The Congressional Budget Office (CBO) scored CHIP as a deficit reducer over ten years because the CBO figured that if there was no CHIP, some parents and kids would access Affordable Care Act (ACA) subsidies. Those subsidies would cost the government as much or more than CHIP to cover fewer people.
ACA plans tend to pay their networks somewhere between Medicare and Commercial rates. CHIP tends to pay somewhere between Medicaid and Medicare rates for their doctors. This matters a lot. I am touching back on a recent Health Affairs article on what a standard office visit costs by type of insurance.
Medicaid pays significantly less per unit of service than an Exchange plan. That means the total premium for an identical risk pool is substantially less for a CHIP/Medicaid program than for an Exchange based program. And since states and individuals often kick in a higher percentage of premium for CHIP the Federal costs are significantly lower.
Covering more people through Medicaid or CHIP buy-in is a net expense reducer for the federal government. States may scream unless there is an adjustment to the matching funds rate as right now people who are covered on the Exchange cost the state budget nothing and moving people to CHIP or Medicaid would shift significant costs to the states.
manyakitty
There you go again with all your facts and reasonable assertions.
? ?? Goku (aka The Hope of the Universe) ? ?
My dad started talking about Health Care Savings Accounts last night. He had heard about them from a John Arnold on the radio. I don’t know anything about them, beyond a general sense that they are bad.
SP
If the savings are significant enough, could they just make Medicaid 100% federal for whatever time period? Shit, federalize the whole thing, to avoid the Roberts-invented state opt-out.
David Anderson
@? ?? Goku (aka The Hope of the Universe) ? ?:
They aren’t necessarily bad. HSA’s are great for healthy people who have no reason to expect that they will have repeated high dollar claims for a long while and have adequate cash flow and discipline to put several thousand dollars a year into an HSA.
They suck for people who either have no cash available to save or who are going to hit their out of pocket max every year no matter what. There is a tax advantage to saving in the HSA so it shifts the composition of savings but it is a limited advantage for someone in the bottom brackets.
Finally, given the tax advantages of an HSA, it is a better retirement savings vehicle than most tax advantaged retirement programs.
p.a.
@SP: Who is ‘they’? The crew running things now? Granted, they’re so incompetent they could end up strengthening what they’re actually trying to destroy, but let’s not count on that. And costing the states more $? We know how red states will react to that.
Ohio Mom
Ohio Dad’s employer offers him the option of putting pre-tax pay into some sort of account to use for various health-care expenses that are not covered by our policy. The catch is, all the money has to be used before the end of the calendar year or we lose the unspent portion; it does not roll over.
If he puts in less than the full amount and we spend more than he put aside, we also lose money (though it isn’t as obviously painful as in first instance).
Now Ohio Dad is very, very good at math, which helps, but there is no way he can see into future. It is him pitted against highly trained and experienced actuaries. It is really a very unfair position to put workers.
narya
@Ohio Mom: My employer also does this–it’s a Flexible Spending Account, or FSA. There are allowable costs (co-pays, medications, and more stuff than you’d think from the drugstore, like bandages and contact lens solution) and you sometimes have to submit receipts. However, for the past few years, we’ve been able to carry over $500 from one year to the next, so I can adjust my next-year deduction (at enrollment time) based on how much I will carry over. I think the carryover is part of the law, so Ohio Dad may actually be able to get closer on this, with the understanding that a carryover is allowable. (this year, for example, I had a lot left at the end of the year–so I doubled up on my contact lens order to spend it.) The employer and the company managing the benefits have to be on board though, too.
Sab
@Ohio Mom: That sounds like a 125 plan not an HSA. HSAs are a good way for high income people to put away tax free money for years until they need it for medical emergencies or the high medical costs of old age. For low and moderate income people the fees eat up all the tax free advantages.
laura
@? ?? Goku (aka The Hope of the Universe) ? ?: they’re an investment vehicle disguised as savings for use for out of pocket medical expenses related to high deductible health care plans.
BofA has flogged/cheerleaded them for the last several open enrollments in my neck of the woods.
Ohio Mom
@narya: Yes, that term, FSA, sounds familiar. I’ll have to ask Ohio Dad if we are now allowed to rollover.
The idea that his employer could potentially make money off the unspent funds — which are after all, his earnings — rankles me no end.
What happens if you don’t spend all funds put aside and then leave the job, either voluntarily or not? Do you get a refund or do they pocket it? I am realizing I never gave this much thought beyond being rankled.
Ohio Mom
In another thread this morning, Kay comments on the work all of us must do to understand health coverage, and that is another cost to all of us. It diminishes the quality of our lives because it is time and energy we could have spent on something, anything, else.
Barbara
Unfortunately, it’s going to be more of the same in the Virginia General Assembly this year when it comes to expanding Medicaid. The difference is that Democrats have more tools to keep Republicans from directing health care relief to their own constituents without expanding Medicaid to the whole state. They’ve already had their first skirmish over a rural hospital in the southwestern part of the state that closed last year after its owner filed for bankruptcy.
https://www.washingtonpost.com/local/virginia-politics/gop-senator-says-va-democrats-threatening-to-kill-or-delay-hospital-bill-unless-he-backs-medicaid/2018/01/16/23c6eaca-fae5-11e7-8f66-2df0b94bb98a_story.html?utm_term=.8576915a6b50
? ?? Goku (aka The Hope of the Universe) ? ?
@David Anderson:
Sounds mostly useless unless one is independently wealthy. Older people are more likely to have health issues that would cost a lot of money, so would more than likely hit their maximum each year.
Ohio Mom
@? ?? Goku (aka The Hope of the Universe) ? ?: You probably don’t have to be independently wealthy — it would probably work if you were an attorney married to s doctor and you both had generous health insurance coverage. At least that is my metaphor for the very comfortable upper middle class.
KithKanan
@Ohio Mom: Where you live matters, as does how your state handles HSAs. I had one for a while last decade, when I was young/single/healthy and at the time in the 25% tax bracket. When my income dropped during the recession, the benefit greatly diminished while the headache from California’s different treatment of them on state taxes stayed the same.
opiejeanne
Did you. see this, David?
This is what I was yammering about earlier today, an excerpt from WaPo:
“In their effort to continue dismantling Obamacare, the Republican continuing resolution does not include funding for community clinics and private hospitals that care for large numbers of low-income patients,” Rep. Karen Bass (D-Calif.) told me. The impact of this budgetary slight was made plain by one of her constituents in an email she shared with me.
Wanted to touch base about CR that doesn’t include health Center funding. St. John’s will lose 10% of our budget ($8.4 million a year). We’ll have to close 6 of our 15 clinics in your district.
It’s also self defeating to fund CHIP but not health centers since most kids with CHIP receive their care at community health centers. So they may have CHIP but they won’t be able to access services because their Health Center is closed.
https://www.washingtonpost.com/blogs/post-partisan/wp/2018/01/22/republicans-claim-to-be-saving-childrens-health-insurance-theyre-actually-hypocrites/?utm_term=.305d7c1b63b9
Kelly
@? ?? Goku (aka The Hope of the Universe) ? ?: We’re using a Bronze HSA plan keep from falling over the 400% of poverty level subsidy cliff. The HSA funds co-pays, dental and vision with money that doesn’t count toward Modified Adjusted Gross Income. The low monthy payments more than make up for the high deductible. The worst case scenario total out of pocket cost is lower than the cheapest Gold plan available.