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Dueling Obamacare Decisions: The Law Must Trump Bureaucracy
Today’s Halbig v. Burwell decision at the U.S. Court of Appeals for the D.C. Circuit represents a massive rebuke of the Obama Administration’s interpretation of the Affordable Care Act (ACA) or “Obamacare.”
Health Care Spending Increasing Amidst Uncertainty
For the first time in five years, the rate of growth in healthcare spending is projected to increase from the previous year. Those are the findings in a new report from major consulting firm PricewaterhouseCoopers (PwC), which forecasts a 6.8 percent growth in health industry spending in 2015. But what does that mean for consumers and taxpayers?
According to the PwC report, several key factors will contribute to more healthcare spending in 2015:
Importantly, the report attributes a significant portion of new healthcare spending to newly-insured Americans who qualified for coverage under the Affordable Care Act (ACA) and will be shopping for coverage options. Next year also happens to be the deadline by which state-run insurance exchanges must become self-sufficient according to the law, but as health spending and enrollment in ACA plans is projected to grow, many states aren't sure how they'll pay those bills.
As Sarah Kliff at Vox.com notes, the federal government has already issued $4.6 billion in taxpayer-funded grants to help states launch their own insurance marketplaces. At least 15 of the 17 states that opted to run their own exchanges have indicated that they will continue to do so in 2015, and in light of considerable uncertainty about how much it'll take to finance them, that could mean either:
Regardless of which path states choose to take, significant spending will be required to keep up with increasing healthcare costs. As the PwC report notes:
"A stronger economy and millions of newly insured Americans mean an uptick in spending growth for healthcare organizations. That may be a welcome respite from recent years of budgetary pressure. But the fact that health spending continues to outpace GDP underscores the need for a renewed focus on productivity, efficiency, and, ultimately, delivering better value for purchasers."0 Comments | Post a Comment | Sign up for NTU Action Alerts
Florida’s 19th Special House Election: A Budgetary Guide
In what some are calling a quiet election, there’s still a lot to be said. Though the challenges of taking drug tests have largely been replaced with who can help create the most jobs in the next five months, before the next election for the same office, Florida residents are asking the same questions of candidates as they did in Florida’s other recent special House election: What will you do in Washington, D.C.? Especially in the wake of their last Congressman, Trey Radel, who resigned after being arrested for possession of cocaine.
In just a couple of short months, three front runners have emerged to battle for the 19th District’s seat: businessman Curt Clawson (R), businesswoman and former political activist April Freeman (D), and former health worker Ray Netherwood (L). Each candidate offers different general solutions to America’s fiscal ills but details have yet to come out about how each would actually change the federal budget. However, by using a methodology similar to National Taxpayers Union Foundation’s (NTUF) BillTally project, taxpayers can see where the candidates stand on at least some of the spending issues. For this brief study, we took direct quotes and campaign materials of candidates and matched them with budget and legislative data to see exactly what the differences and similarities are.
Similar to the New Jersey Special Senate and Florida’s 13th Special House elections, details were few and far between. Even with the campaigns releasing economic plans and platform summaries, we’re still left asking what will they do if elected as the House of Representative’s newest member?
Check out the entire line-by-line analysis of all three candidates. As with NTUF’s other BillTally and campaign studies, only changes in current spending are recorded (similar to the Congressional Budget Office). The reports do not include changes in revenues or costs outside the federal government. Below are summaries of each candidates’ proposals.
Curt Clawson (R) has proposed two (out of 12) quantifiable policies that NTUF was able to score. Combined, they would decrease annual spending by $395.8 billion. The largest budget-influencing item that he supports would cap federal expenditures at 19 percent of GDP, which would be implemented using the “Penny Plan,” which would cut spending by one percent each year as long as the budget is not balanced.
April Freeman (D) has two (out of 12) policy items that NTUF could fiscally score. Together, they would increase spending by $20.203 billion each year for the next five years. Her largest quantifiable proposal would overhaul the immigration system.
Ray Netherwood (L) had one proposal that NTUF could identify. It would be to replace the current income-based tax system with a national sales tax, known as the Fair Tax. The measure would cut an average $19 billion in federal outlays for each of the next five years.
Normally, there would be some overlap between the candidates’ platforms. In the other Florida Special Election, the front runners supported increasing current spending by $180 million per year to delay a scheduled rate increase for the National Flood Insurance Program. That was not the case in this House race, although the three candidates were not asked similar questions when interviewed by the same source.
What does this mean for taxpayers and residents of the 19th District? It’s time for the campaigns to give Americans more details. While candidates are asking Floridians for their vote, taxpayers are asking for the roadmap of each candidate’s path to reach a better and expanding economy. As highlighted above and in the full report, the absence of budgetary facts and figures opens the possibility that all of the candidates could have much larger or smaller spending aspirations in mind. Clawson, Freeman, or Netherwood need only clarify their intentions with dollar figures to help complete this report and help educate Americans on important and pressing issues that we’re all facing.
Note: National Taxpayers Union Foundation is a 501(c)3 nonprofit organization. Our research efforts are intended only to educate Americans on how their tax dollars are being or will be spent by those in office, seeking office, or in appointed positions. For more information on NTUF go here.0 Comments | Post a Comment | Sign up for NTU Action Alerts
DC's Healthcare Exchange Suffers Same Afflictions as Obamacare
For Skip Moskey, and many D.C. residents, signing up for health insurance through DC’s new insurance marketplace has been like “climbing the great wall of China.” But instead of climbing up an ancient wall, DC residents are climbing through miles of red tape.
The Washington Post explained on Wednesday that processing problems on the new marketplace are causing delays to coverage up to three months. With myriad insurers including CareFirst and Kaiser Permanente reporting they have received information with flawed data, or failed to receive applications at all, it appears the problem is occurring at the DC Healthlink.
The DC Healthlink is a government-sponsored marketplace providing mandatory insurance coverage, one of 14 which states have set up after the unsuccessful launch of the national exchange. Yet, it seems the smaller exchange is running into many of the same glitches and processing problems the national exchange encountered last year.
Healthlink is not only costing DC residents time, but also money. The Washington Post reported that those seeking coverage through DC’s marketplace could pay more than twice as much a month than with a previous plan.
This extreme case was true for Skip Moskey who discovered the new policy would cost him $667 a month compared to $330 a month he was paying with CareFirst BlueCross BlueShield.
When the cost of time and money is substantially larger than the alternative, it is difficult to imagine many would volunteer to attain coverage under the Healthlink. But instead of paying $337 more for the new policy, taxpayers will be paying $1.8 trillion.0 Comments | Post a Comment | Sign up for NTU Action Alerts
Medicaid and Medicare disburse over $1 trillion in benefits per year, representing a massive portion of the $2.7 trillion that goes into healthcare-related spending in the U.S. each year. On top of that, the bureaucratic system that determines who receives those benefits (and how much) has grown increasingly complex over the years: next year, Medicare alone will have nearly 140,000 different codes doctors must choose from to describe their patients' injuries if they want to make a claim through that program. The massive amount of money in the system, combined with the complicated and often difficult-to-enforce regulatory checks in place, makes it a target for those looking to rip off taxpayers for their own monetary gain.
The estimated cost of healthcare fraud for taxpayers? $272 billion.
A recent article in The Economist makes note of some of the ways fraudsters can take advantage of the system, including overbilling for treatments and partnering with doctors and pharmacies to obtain, and then resell, prescription drugs for profit. Federal investigators report that incidences of healthcare fraud have increased by four times over the past five years. The problem takes significant resources to fight, but with fraud so rampant and lucrative, doing so can yield significant savings for taxpayers: the Department of Health and Human Services reported earlier this year that over the past three years, enforcement teams have recovered $8 for every $1 they spend to investigate fraud. Last year, the government recovered $4 billion, which is just a fraction of the total amount lost to fraud but represented a record-high success rate.
Still, the high cost of health care fraud illustrates the dangers that overly-complicated entitlement programs can pose to taxpayers -- they are easy targets for thieves looking to take advantage of a system that offers millions of transactions to hide behind every day.0 Comments | Post a Comment | Sign up for NTU Action Alerts
Obama Administration Backs Away from Costly Proposed Rule Change
Taxpayers dodged a multi-billion-dollar bullet this week when the Centers for Medicare and Medicaid Services (CMS) indicated that it no longer intends to implement a costly package of changes to Medicare Part D.
The decision by CMS came just hours before the House of Representatives planned to vote on H.R. 4160, the Keep the Promise to Seniors Act, sponsored by Congresswoman Renee Ellmers (R-NC). This bill, which NTU enthusiastically supported, would have blocked the proposed rule.
I blogged about the issue last week and noted the strong opposition that was mounting against the rule changes:
[A] bipartisan group of 20 Senators led by Finance Committee Chairman Ron Wyden (D-OR) and Ranking Member Orrin Hatch (R-UT) recently expressed very strong objections to the proposed rule in a letter to CMS Director Marilyn Tavenner.
Though NTU has had our fair share of concerns about Medicare’s prescription drug program, we were very pleased to see CMS reverse course on a plan that would have cost taxpayers an additional $1.6 billion per year, according to the Milliman actuarial firm. However, as I noted in my earlier post, taxpayers must remain vigilant, as this was “yet another example of the Obama Administration’s over-utilization of the rulemaking process.”0 Comments | Post a Comment | Sign up for NTU Action Alerts
Changes to Medicare Part D Could Cost Taxpayers Billions
Since Medicare Part D’s creation in 2003, National Taxpayers Union has expressed concerns about its impact on the federal budget. The program, which instituted a prescription drug benefit for Medicare, cost $55 billion in 2012 – a hefty price tag, yet much less than original projections that suggested it would saddle taxpayers with a $123 billion burden.
It’s encouraging (and extremely rare) to see a federal program defy the trend and actually come in well below the cost forecasts. Unfortunately, recent actions by the Obama Administration could take Part D in the wrong direction. In approximately 700 pages of text, the Centers for Medicare and Medicaid Services (CMS) has proposed wholesale changes that could reduce options within the program, increase premiums, cancel or significantly alter millions of existing plans, and force taxpayers to shell out more. In fact, a study by the Milliman actuarial firm concluded that Part D would cost an additional $1.6 billion per year if the rules are adopted.
Thankfully, a bipartisan group of 20 Senators led by Finance Committee Chairman Ron Wyden (D-OR) and Ranking Member Orrin Hatch (R-UT) recently expressed very strong objections to the proposed rule in a letter to CMS Director Marilyn Tavenner. Similarly, a letter to Director Tavenner from House Ways & Means Chairman Dave Camp (R-MI), House Energy & Commerce Chairman Fred Upton (R-MI), and Senator Hatch asks her to “reject these harmful changes to the Part D program and withdraw this proposed regulation.”
The CMS proposal is yet another example of the Obama Administration’s over-utilization of the rulemaking process. As strong bipartisan opposition to the rule continues to grow, NTU hopes CMS will be mindful of taxpayers as well as seniors, and abandon it altogether.0 Comments | Post a Comment | Sign up for NTU Action Alerts
The whole gang is seemingly in the house this episode: Vice President Brandon Arnold explains why Congress needs to pass legislation to prevent an insurance company bailout through "Obamacare"; State Affairs Manager Lee Schalk updates on state issues to start the year; and NTUF's Dan Barrett talks about this year's Price the Proposals State of the Union game!0 Comments | Post a Comment | Sign up for NTU Action Alerts
Obamacare features a fund which pays out to insurance companies when their costs exceed targets (read more about this in NTU's letter to the Hill).
The reason this particularly matters to taxpayers is the administration seems willing to "stretch" this power - meaning taxpayers could be bailing out insurance companies when whatever is banked in this fund (otherwise known as squat) runs out as Health and Human Services pays off those insurers because Obamacare is forcing them to offer excessively costly plans.
Make some noise on this issue by contacting your Representative and Senators and telling them to support that legislation! This is yet another way Obamacare is finding to hurt taxpayers, and we cannot afford it.2 Comments | Post a Comment | Sign up for NTU Action Alerts
We’ve addressed this before, but claims about “Obamacare” being deficit neutral are STILL heard to this day. In an effort to once again diffuse this misconception, let’s examine how the Patient Protection and Affordable Care Act (ACA) has been scored over time – for anyone citing old numbers, this should put to bed any “deficit-neutral” talk.
For those inclined to believe the President, its understandable why they might echo his original claims on the subject. In September 2009 the President claimed "I will not sign a plan that adds one dime to our deficits — either now or in the future."
While budget gimmickry allowed for Congressional Budget Office scores that backed these statements, anyone paying attention over the last three years should know better – there’s that word again!
Just before the law was passed in March 2010, the Congressional Budget Office estimated that the law would save $130 billion over its first decade.
We started the saga of these Affordable Care Act claims with that CBO estimate, yet when picked apart, it was revealed to be rather concocted for a number of reasons.
First, the package given to the CBO ignored what’s dubbed the “doc fix”. This $371 billion Medicare reimbursement cut for doctors is routinely delayed or “fixed”, meaning Medicare habitually ignores it and spends the ever increasing sum anyway. Not including this hefty price in government healthcare artificially lowers its total cost by compartmentalizing the spending in multiple bills.
The law also double counted about $70 billion in savings from the CLASS Act, along term care program. Finally, the CBO is forced to assume that Congressional projections for health spending will be abided by and not dumped out of political convenience, another dubious notion.
As the law came ever closer to implementation, the delay in the employer mandate happened. This will cost as much as $10 billion as expected fines are not collected over the year-long postponement, according to CBO. The mandate delay is also expected to push additional Americans into the federally subsidized exchanges, which would push costs up by as much as $5 billion more.
Now, CBO has revised its ten-year cost estimate for Obamacare to upwards of $180 billion.
The CBO report is paired with a Government Accountability Office report from January which maintains most of the supposed savings from the ACA are contingent on cost saving mechanisms and assumptions that place the political burden on Congress to maintain. The GAO “expressed concerns” about the will of Congress in this regard. That same report calculated the ACA would add an additional $6.2 trillion to America’s long term deficit.
This information should preclude any claims that Obamacare is deficit-neutral or even reduces the deficit. Unfortunately, we have to keep saying “should”, which means the parties guilty of continuing these claims are likely to continue, and we can keep calling them on it.1 Comments | Post a Comment | Sign up for NTU Action Alerts