Delusional – “one who has a persistent false psychotic belief.” (Webster’s dictionary)
This word has been used to describe President Obama’s perception of many issues including the Iran Deal, the economy, radical Islamic terrorism, and now healthcare.
In a vain attempt to solidify his legacy political triumph, ObamaCare, President Obama has written an op-ed in The Journal of the American Medical Association (JAMA) extolling the virtues of the Affordable Care Act and his HHS Secretary, Sylvia Matthews Burwell, has released an analysis that is straight from the “spin machine.”
The JAMA article, researched by seven authors who are only acknowledged in the fine print at the end of the article, concludes that “The Affordable Care Act has made significant progress toward solving long-standing challenges facing the US health care system related to access, affordability, and quality of care.”
The HHS Secretary concludes:
- The median individual deductible for HealthCare.gov Marketplace policies in 2016 is $850, down from $900 in 2015.
- On average, Healthcare.gov Marketplace policies cover seven common health care services (most often generic drugs and primary care visits), in addition to preventive services, with no or low cost-sharing before consumers meet their deductibles.
It’s an old saying that “figures don’t lie, but liars can use figures.” This is a perfect example of that truism.
Brian Blase, writing in Forbes, shows how the HHS analysis goes wrong. Instead of the usual presentation of the average, Burwell chose to quote the median. HHS’ analysis relied exclusively on the median plan deductible ($850) and did not include the weighted average plan deductible. The likely reason for this is because the HHS table reports an unrealistic $0 deductible for over a third of enrollees.
Blase calculated the weighted average exchange plan deductible at $2,090. The weighted average plan deductible is nearly 150% higher than the median value reported by HHS.
Low Median Deductible Results From Skewed Risk Pool
The reason that the median deductible is so low is that most exchange plan enrollees are beneficiaries of the cost-sharing reduction (CSR) program. In this program, HHS makes monthly payments to enrollees’ insurance companies for insurers to reduce plan deductibles and other cost sharing amounts. These CSR payments typically lower plan deductibles to $500 or less for single coverage for people with income below 200% of the federal poverty level (FPL).
If the risk pool were more balanced, a smaller percentage of enrollees would be receiving CSR payments. Then the median deductible would be higher. The high deductibles for those not receiving CSR payments, which equal about $3,000 for Silver coverage and $6,300 for Bronze coverage, are one reason that exchange plans are largely unattractive to people in the middle class.
In other words, if you make more than 200% of FPL, the exchange plans are a poor value for you and few middle class patients have enrolled. Thus the pool of enrollees reflects mostly people getting assistance with their premiums and their deductibles. The median deductible is going down because more and more people in the risk pool are receiving assistance.
In January 2015, the Urban Institute projected that only about a third of exchange plan enrollees would have incomes below 200% of FPL. But actual enrollment figures show nearly two-thirds of all exchange enrollees have incomes below 200% of FPL in 2014, 2015, and 2016.
CSR Payments Illegal
To make matters worse, U.S. District Court Judge Rosemary Collyer has ruled that Congress never appropriated the billions of taxpayer dollars that the Obama administration has been delivering to the insurers through the CSR program. The issue was raised in a lawsuit brought against the White House by the House of Representatives, which holds that the executive branch cannot spend money that has not been appropriated by the House.
Judge Collyer wrote, “Paying out cost-sharing subsidies without an appropriation violates the Constitution. Congress is the only source for such an appropriation, and no public money can be spent without one.”
On July 11, the New York Times reported, “Obama administration officials last week were unable to cite legal authority for the spending during a House hearing and could not identify any specific appropriations.”
HHS concluded its analysis with these words of hyperbole: “The ACA has given every American the peace of mind that their health coverage will be there when they need it.”
Yet, a Gallop poll released last year reported that 42% of Americans still consider cost or access as the most urgent health care problem. A 2016 Kaiser Family Foundation survey revealed more enrollees rate the coverage they received as providing “poor” or “only fair” value rather than “excellent” or “good” value.
Even the New York Times acknowledged that many people say high deductibles make their health law insurance all but useless. They detailed stories of numerous people who dropped their plans because they provided so little benefit relative to the cost.
Blase concludes: “If HHS was concerned about addressing the problems with the ACA, it would probably help if they first dealt with reality instead of political spin.”