Tuesday, November 9, 2010

Rise Of The Underminers

With Republicans now controlling both state legislatures and Governor's mansions in some 20 states, attention is turning to how and even if GOP-led states will even implement health care reform procedures.

For example, although the law sets baseline standards such as essential benefits that insurers must offer if they wish to sell plans on the exchanges, states can add any mandates. A state could require insurers to prove that their policies are achieving certain outcomes - high child immunization rates, for instance. Or it could allow virtually all comers into its exchange in hopes that doing so would keep costs lower.

States will also have to decide whether they will run the exchanges or outsource their oversight to a private entity.

Similarly, although the law requires states to review "unreasonable" premium increases, it will largely be up to each state to determine what that review process entails. States could require insurers to offer detailed justification and seek preauthorization for any rate increases. Or they could ignore all but the most substantial rate increases, and even then, simply require that insurers file reports detailing their reasons for the rise.

State approaches to insurance regulation differ substantially, and the range was evident in the variations among recent state applications for federal grant money that the law provides to help them develop their new rate review processes. Five states - Alaska, Georgia, Iowa, Minnesota and Wyoming - did not even request funding.

States will also be in a position to exert pressure on the federal government when it comes to the law's requirement that insurers spend 80 to 85 percent of the premiums they collect to pay medical claims or otherwise improve their customers' health. If a state thinks the requirement would cause too many insurers to drop out of its market, it can ask the Department of Health and Human Services for a waiver. Iowa and Maine have already done so, and other states are likely follow.

HHS has the final say. However, it could prove awkward for Secretary Kathleen Sebelius to turn down insurers backed by state governments.

Regardless of what regulations state governments choose to set, their willingness to commit the staff and resources needed to carry them out could also vary considerably.

"Having rules on paper and enforcing rules are not synonymous," said Alan Weil, executive director of the National Academy for State Health Policy, a nonpartisan group that has been monitoring and facilitating state implementation efforts. 

In other words, it won't stop states from taking federal money...but there's the distinct possibility they will set up a program that will do nothing to provide oversight or cost controls for exchanges, or that they will simply put all existing insurers into the state in the exchange and then refuse to enforce anything, or just get a waiver and ignore the provisions altogether.

When health care costs continue to skyrocket in those states, the Republicans will blame "the failure of Obamacare."  Frankly, it's a good plan.  Americans are not interested in whom to blame, but only in results.  And when the results are health insurance providers can jack up rates as high as they want in these states and blame Obama, the Republicans are going to have a lot of capital towards a real repeal effort in 2012.

11 comments:

SteveAR said...

When health care costs continue to skyrocket in those states, the Republicans will blame "the failure of Obamacare."

That's because it will be the fault of Obamacare for the increases. My insurance premiums are going to increase 11% despite the fact that Obama and the Democrats promised costs Americans would have to pay (which includes insurance premiums) would be reduced.

Americans are not interested in whom to blame, but only in results.

But when the results are increased costs, Americans are happy to blame the culprit.

Frankly, it's a good plan.

One of the new "features" this year includes a provision to not allow consumers to use their health savings accounts for non-prescription medications, like aspirin. I have to get a prescription, which means a doctor visit, which means increased costs. It is not a good plan.

But I know who is to blame, and it isn't Republicans.

Zandar said...

And you'll blame "Obamacare" no matter what happens. The GOP is counting on that when they set the programs up at the state level to fail. You're exactly who I was writing about.

Thanks for proving my point.

JoyfulA said...

An HSA withdrawal to buy aspirin?

SteveAR said...

Zander:

And you'll blame "Obamacare" no matter what happens.

When it's the cause of the rise of my health care costs, when Obama and the Democrats claimed it would lower them, yeah, you bet I'm going to blame "Obamacare".

JoyfulA:

An HSA withdrawal to buy aspirin?

You do know what aspirin is, don't you? It has something to do with health care. And it is my money.

StarStorm said...

You need to make a doctor's appointment to save a couple bucks on a bottle of aspirin?

The hell?

SteveAR said...

You need to make a doctor's appointment to save a couple bucks on a bottle of aspirin?

Actually, it doesn't save any money. What it does do is increase costs to the insurance company or me. This year, I could use my health savings account money to buy aspirin over the counter. Next year, to do the same thing, I have to get a prescription first. Or pay for it with my outside of my health savings account, even though health savings accounts exist to pay for such things and it's my money in that health savings account. All thanks to the wonders of Obamacare.

Unknown said...

Yes, SteveAR, it's your money in your HSA because you are the one who decides how much money to put there.

When setting your 2011 HSA amount, you'll want to take this change in coverage for OTC meds into consideration, since that is completely in your control.

SteveAR said...

When setting your 2011 HSA amount, you'll want to take this change in coverage for OTC meds into consideration, since that is completely in your control.

I could do that. But my HSA amount is a before-tax contribution, whereas if I lower my contribution, the money I don't contribute is taxed as income. I don't want the government to take any more of my money than necessary.

Unknown said...

HSAs didn't start covering OTC drugs until 2003, so you've had a nice seven year run of buying aspirin with post-tax dollars. Good times!

SteveAR said...

Well, the good times are over now. Can't wait to see what other things Obamacare is going to take away.

I'm also a small business owner. Thanks to Obamacare, in a couple of years I get to increase my business costs filing unnecessary additional paperwork to the bureaucrats at the IRS, because Obama and the Democrats believe these petty bureaucrats need to know every single little personal detail of my business, even if those details have nothing to do with my tax liability.

SteveASS said...

jeez dude. between posting on your own blog and trolling, how much time do you actually spend running your business? are you sure you're not bitching about the "unnecessary paperwork" because it'll cut into all the time you're currently wasting here and on (god knows how many) other liberal blogs? asswipe.

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