A few issues with the @EnergyCommerce "Build Back Better Act" provisions relating to states that rejected #ObamaCare's #MedicaidExpansion.

Based on a summary by @CenterOnBudget's @JudyCBPP: cbpp.org/research/healt….

1. Rewards Republican states for rejecting #ObamaCare.

It would authorize Exchange subsidies for people below the poverty line--but only in states that rejected the #ACA's #Medicaid expansion.

That gives GOP states a better deal than Democratic states that embraced #ObamaCare.
2. Costs more than expanding Medicaid.

Taxpayers in Democratic states would end up paying more to cover those 2 million people because:

- "private" #ObamaCare plans spend more per person than Medicaid

- governments in non-expansion states wouldn't have to contribute anything
3. Effectively creates a "public option."

Unlike other workers, the target population could get "free" Exchange plans even if their employer offers "affordable" coverage. That turns "private" #ObamaCare plans into a public option -- with a very uneven playing field.
Again, Democrats are planning to create this public option only in Republican states.
4. Adverse selection.

Congress generally allows Exchange enrollees to switch plans only during certain parts of the year, because otherwise #ObamaCare's community-rating price controls would have an even greater negative impact on quality & could cause the Exchanges to collapse.
On how #ObamaCare's community-rating price controls create a race to the bottom on quality, see: healthaffairs.org/do/10.1377/hbl…
The @EnergyCommerce bill would allow the target population to switch Exchange plans any time of year, leading to greater adverse selection and a faster race to the bottom on quality.

Congress would have to subsidize these plans heavily to prevent the market from collapsing.
5. Gouging taxpayers for family planning and contraceptives.

The bill requires the new #ObamaCare plans to cover all family-planning providers.

This would eliminate insurers' negotiating leverage and empower such providers to charge taxpayers whatever prices they want.
#ObamaCare's contraceptives-coverage mandate did the same, leading to wild price increases for hormones & oral contraceptives: infogram.com/figure-4-real-….

The would further gouge consumers and taxpayers for those items by extending that mandate to 2 million more consumers.
6. Setting the stage for even more government spending.

The bill is unlikely to deliver on its plan to move the target population out of "private" Exchange plans and into "private" (or "privately administered") Medicaid coverage after three years.
Enrollees won't like getting dropped from their health plans into Medicaid, where they would have less provider choice.

Providers won't like getting paid less to treat those patients.

State officials won't like that less federal money would be coming into their states.

The @EnergyCommerce bill increases federal spending on health care in the immediate term and creates incentives for interest groups to lobby heavily for even more federal spending in just three years.
7. Hypocrisy.

It really is remarkable how @TheDemocrats complain that the U.S. health sector is so expensive but then every chance they get, they throw more taxpayer money at it.
Addendum to #3.

@JudyCBPP writes, "All people who would be eligible for Medicaid if their states had expanded, including those with incomes between 100 and 138 percent of the poverty line, would be eligible to enroll in the enhanced plans."

That has important implications.
For one thing, it means the target population is not just the 2 million uninsured people below the poverty line that @JudyCBPP mentions at the outset of her paper.

It also includes another 2 million (acasignups.net/21/05/10/updat…) or so people already in #ObamaCare Exchange plans.
Federal spending on those other 2 million folks would increase, because they would receive more comprehensive coverage under the @EnergyCommerce plan than under current law (e.g., 99% vs. 94% actuarial value).
The @EnergyCommerce plan would also make the enhanced Exchange plans available to people between 100-138% FPL in non-expansion states who *aren't* currently enrolled in Exchange plans.
At the same time, the @EnergyCommerce plan would tear down the barrier to Exchange subsidies for workers who have an offer of "affordable" coverage from an employer.

Can you see where this is going?
The @EnergyCommerce plan would offer essentially "free" health care (99% AV) everyone below 138% FPL in non-expansion states, including workers who already have employer coverage.
The @EnergyCommerce bill would essentially create a "public option" in the form of #ObamaCare coverage, and tilt the playing field heavily in favor of that public option, for ALL households below 138% of the poverty line in non-expansion states.
The @EnergyCommerce bill would create huge incentives for employers to find ways to drop coverage for low-wage workers rather than try to compete with "free" health care.
I also have an addendum to #6.

Another interest group that will line up to expand this new program would be Democratic states. The @EnergyCommerce bill would offer these new subsidies only in states that didn't "do the right thing" by expanding Medicaid.
Democratic states that did expand Medicaid will claim it is unfair that they have to pay more because non-expansion states "aren't paying their fair share."
Democratic states will call this the "Medicaid expansion penalty."

They will demand that Congress end that "penalty" by--you guessed it--expanding this program into Medicaid-expansion states, giving Democratic states the same $$ that Republican non-expansion states are getting.
I had first surmised the @EnergyCommerce bill's proposal to move the target population from enhanced Exchange plans to this new form of Medicaid coverage in 2025 would never occur.

There would just be too much pressure from interest groups to keep the new Exchange money flowing.
I'm now ready to predict that will occur before this bill even passes Congress.

If @TheDemocrats go this route, they will make the @EnergyCommerce's new Exchange plans permanent from the get-go, and scrap the new Medicaid program for this population.
If they do keep the new Medicaid program, it will just be a budget gimmick to keep down the CBO score of what they know is going to happen -- i.e., setting in motion new Exchange plans for this population, that eventually become permanent, in all states.

• • •

Missing some Tweet in this thread? You can try to force a refresh

Keep Current with Michael F. Cannon

Michael F. Cannon Profile picture

Stay in touch and get notified when new unrolls are available from this author!

Read all threads

This Thread may be Removed Anytime!


Twitter may remove this content at anytime! Save it as PDF for later use!

Try unrolling a thread yourself!

how to unroll video
  1. Follow @ThreadReaderApp to mention us!

  2. From a Twitter thread mention us with a keyword "unroll"
@threadreaderapp unroll

Practice here first or read more on our help page!

More from @mfcannon

17 Jun
1/ SCOTUS agrees 7-2 with #ObamaCare critics like @jadler1969 & me (nypost.com/2019/03/28/oba…) that the plaintiffs in #CAvTX lacked standing to challenge #ObamaCare's individual mandate: supremecourt.gov/opinions/20pdf…. GOP appointees Roberts, Thomas, Kavanaugh, Barrett joined majority.
2/ #CAvTX arose after Roberts in #NFIBvSebelius saved the #ACA by interpreting the mandate as a tax. NFIB "gutted the Constitution's political-accountability constraint, which had prevented Congress from creating the mandate via Congress' taxing power." forbes.com/sites/michaelc…
3/ Roberts' opinion indicated that if the Court could not interpret the mandate as a tax, the mandate would have been unconstitutional.
Read 18 tweets
17 Jul 20
#DCCircuit affirms district court, rules against private insurers seeking to crush their competitors by stripping coverage from patients with #PreexistingConditions.

cadc.uscourts.gov/internet/opini… #STLDI #ACAPvTreasury #CatoHealth @CatoInstitute @TheBuckeyeInst @jrovner @StephArmour1
Appellants are @safetynetplans -- i.e., #ACA-participating private insurance companies.

They complain competition from short-term, limited duration health plans--#STLDI, which Congress exempts from #ObamaCare's costly regulations--are hurting their revenues.
These #ACA plans literally asked the court to block their competitors from offering a product because many consumers would like their competitors' products better than #ObamaCare coverage.
Read 13 tweets
19 Feb 20
“If health economists were in charge of the health system, not a lot would change,” which tells you just about all you need to know about most health economists in the United States. @afrakt ow.ly/bJO030qj6KX
@afrakt More constructively...the responses to this survey's normative questions confirm something that I’ve observed anecdatally: there is a mountainous structural ideological-bias problem in #HealthPolicy.

cc: @KosaliSimon, @cawley_john
@afrakt @KosaliSimon @cawley_john The health policy professions skew left, because federal and state health policy skew left; thus the set of individuals who select into these professions skews toward those whose ideas concern *how* government should allocate resources/regulate rather than *whether* it should.
Read 7 tweets
7 Feb 20

The more of our lives and decisions government controls, the more tolerant everyone becomes of corruption, at least among their own tribe. Big government encourages corruption by increasing the cost of integrity.
Think about it. If we had a night watchman state, where the government controlled <10 percent of the economy, there would be much less riding on each election. The spoils of each election would be much smaller. There would be less of the economy to divvy up.
Fewer jobs would depend on who wins elections. Winning a seat in Congress would not confer the status it does today, nor be the gateway to a lucrative career in lobbying that it is today.
Read 12 tweets
6 Feb 20
As a #libertarian who watched congressional Republicans attempt to remove a Democratic president (1998-99) and congressional Democrats try to remove a Republican president (2019-20), what strikes me the most about these two episodes is how similar they are. #TrumpImpeachment
I witnessed Clinton’s trial up close, as a staffer for the leadership of the US Senate. Clinton clearly committed perjury, suborned perjury, and merited removal. @jacobsullum made the best case, though I can’t now locate the column. Similar column: unz.com/print/Reason-1….
Yet the facts didn’t matter to Senate Democrats. They just kept repeating it was only sex (it wasn’t), Republicans were being partisan (immaterial), and Clinton’s actions didn’t rise to the level of removal (they did). Whatever they needed to say to keep their guy in power.
Read 11 tweets
19 Jul 18
A comment I posted on Facebook…

Let’s assume the @NHS’s troubles are due to inadequate funding and that one political party is to blame — i.e., other political parties would set spending at the “right” level. 1/
@NHS If you support giving government control over the health care sector of the economy, then, by definition, that means you support occasionally letting that power fall into the hands of the “wrong” political party. 2/
@NHS One might want to wish away, disenfranchise, reeducate, or outlaw the offending political party. But some of those options are undesirable and none of them are feasible. 3/
Read 7 tweets

Did Thread Reader help you today?

Support us! We are indie developers!

This site is made by just two indie developers on a laptop doing marketing, support and development! Read more about the story.

Become a Premium Member ($3/month or $30/year) and get exclusive features!

Become Premium

Too expensive? Make a small donation by buying us coffee ($5) or help with server cost ($10)

Donate via Paypal Become our Patreon

Thank you for your support!

Follow Us on Twitter!