Justin's Political Corner

AUSTIN, Texas—Big in all things, Texas leads the nation in failing to provide health insurance. About one in four Texans are uninsured, the highest percentage in any state. That’s some 6 million people, the total population of Missouri.

Yet Gov. Rick Perry, back from his stumbles in the 2012 GOP presidential race, has insisted that Texas will not accept the federal money provided by President Obama’s health care law to expand Medicaid coverage. As Republican governors from Arizona to New Jersey have joined the program, Perry has amplified his opposition. In a bristling speech to conservatives last week, he said governors who accepted the money had “folded in the face of federal bribery.”

In no state does the decision to expand present such profound political and policy issues as in Texas. Whatever Perry decides, many Texans will benefit from the subsidies in the 2010 law that help the uninsured in lower-to-middle-income families purchase private insurance on health care exchanges. Perry has also refused to establish such an exchange, but the law allows Washington to step in, and Texans who qualify will receive those dollars. Rice University demographers Steve Murdock and Michael Cline recently projected those exchanges will cover up to 1.7 million of the state’s uninsured.

The law’s other mechanism for increasing coverage is to broaden Medicaid eligibility for adults near poverty, but Washington can’t mandate this expansion if states refuse it. Murdock and Cline project that another 1.5 million to 2 million Texans would receive coverage if the state participated.

The state medical establishment, reluctant to cross the governor too publicly, has been restrained in pressing for expansion. But Republican state Rep. John Zerwas, a health care leader who represents a district outside Houston, says legislators are getting an earful at home from providers and local officials worried about the state rejecting the money.

Key state Senate Republicans, though, are striking a harder line. Senate Finance Committee Chairman Tommy Williams says he will support enlarging Medicaid only if Obama allows Texas to transform the way it delivers Medicaid, not only to the expansion population but also to the current recipients. “The existing program is not sustainable,” Williams says.

That’s a hardball position, but not necessarily disqualifying: The administration has reached an agreement in principle with Florida, for instance, to move more Medicaid recipients into private managed care. Many here, though, wonder if Perry would take any deal. The widespread belief is that he intends to seek the GOP presidential nomination again in 2016, and accepting more Medicaid money would smudge his image of Alamo-like resistance to Obama.

Rejecting the federal money might not pose an immediate political threat to Texas Republicans, whose coalition revolves around white voters responsive to small-government arguments. But renouncing the money represents an enormous gamble for Republicans with the growing Hispanic community, which is expected to approach one-third of the state’s eligible voters in 2016. Hispanics would benefit most from expansion because they constitute 60 percent of the state’s uninsured. A jaw-dropping 3.6 million Texas Hispanics lack insurance.

Texas Democrats are too weak to much affect the Medicaid debate. But if state Republicans reject federal money that could insure 1 million or more Hispanics, they could provide Democrats with an unprecedented opportunity to energize those voters—the key to the party’s long-term revival. With rejection, says Democratic state Rep. Rafael Anchia of Dallas, Republicans “would dig themselves into an even deeper hole with the Hispanic community.”

In 1994, California Republican Gov. Pete Wilson mobilized his base by promoting Proposition 187, a ballot initiative to deny services to illegal immigrants. He won reelection that year—and then lost the war as Hispanics stampeded from the GOP and helped turn the state lastingly Democratic. Texas Republicans wouldn’t be threatened as quickly, but they may someday judge their impending decision on expanding Medicaid as a similar turning point.

H/T: National Journal

The Affordable Care Act’s biggest year is, without a doubt, 2014: That’s when the federal subsidies to purchase health insurance roll out. It’s also when penalties for not buying coverage kick in. 

But many of the big changes will start gradually in 2013. They range from increasing payments to Medicaid doctors to upping Medicare taxes to the exchanges’ very first open-enrollment period. Here’s a quick guide to what will happen in health care in the next year1. Health-care cost growth will slow to a new low. The United States is expected to spend a $2.9 trillion on health care in 2013, according to actuaries at the Center for Medicare and Medicaid Services. That would be 3.8 percent more than then $2.8 trillion that CMS estimates we spent in 2012.

That 3.8 percent growth rate, if it actually happens, would be the slowest health-care growth in decades. That has little to do with the Affordable Care Act, the CMS actuaries explain, and a lot more to do with slow income growth.

2. Your Medicare taxes will increase. Some people mark the turning of the new year with champagne and kisses. The Affordable Care Act has something slightly different in mind: Two new taxes to finance Medicare. Both are meant to bring in additional revenue to continue funding the health-care program for seniors.

Employers already take out 7.65 percent of workers’ wages to support the elderly and disabled. Of that, 1.45 percent goes toward paying Medicare’s hospital bills. Obamacare increases the Medicare hospital tax by 0.9 percent, beginning in 2013, for anyone who earns more than $200,000 ($250,000 for joint filers). It also creates a new, 3.8 percent tax on investment income, setting income thresholds at the same $200,000 and $250,000 levels mentioned above. Taken together, those two provisions are expected to generate $210.2 billion over the next decade. 

. Your insurance plan will be explained in plain English. Say goodbye to insurance forms with 8-point font that stretch on for dozens of pages. Starting in 2013, the Affordable Care Act requires insurance companies to send their subscribers a standardized, four-page summary of benefits and coverage that runs through the health plan in easy-to-understand terms. Think of this as a nutrition label for health insurance. Here’s what one page of thesample summary looks like.

This requirement actually kicked in a few months ago: Health insurance plans with open enrollment periods after Sept. 23, 2012, were required to offer this information. For anyone buying insurance from a plan with earlier open enrollment, these summaries will show up for the first time in 2013.

4. Primary care providers in Medicaid will get a 73 percent raise. The Congressional Budget Office estimates that Medicaid will gain 7 million new enrollees in 2014, as a result of the health law expanding the program up to 133 percent of the poverty line. The federal government wants to make sure that doctors keep serving that population, even though the Medicaid program tends to pay physicians less than private insurance. That’s why the health-care law includes a provision that boosts primary care reimbursements in Medicaid to match those of Medicare for 2013 and 2014. On average, that will mean a 73 percent raise for Medicaid doctors, according to researchers at the Urban Institute. As you can see in the map below, there’s lots of variation between states in terms of the size of this pay raise. 

5. The Obamacare exchanges will open for business. We often talk about January 1, 2014 as the date that states need to be ready for the health reform law. But when you talk to the states actually working to roll out the law, they often talk about October 1, 2013 as a much more significant deadline. That’s the day when the health exchanges open for business, when any American can go online, compare plans and, if they want, purchase health insurance. This is true for state-operated health exchanges as well as those being run by the federal government. 

h/t: WaPo

As rumors swirl that Democrats may consider raising the Medicare eligibility age to reach a deal before the looming “fiscal cliff,” a top Senate Democrat expressed opposition to that option Sunday. Speaking on Meet the Press, Senate Majority Whip Dick Durbin (D-IL) said raising the age at which seniors can receive Medicare from 65 to 67 would leave retired seniors with a dangerous gap in their health coverage:

DAVID GREGORY (HOST): Senator, one point about Medicare. You say you want to put off this discussion until later. But bottom line, should the Medicare eligibility age go up? Should there be means testing to get at the benefits side, if you want to shore this program up, because 12 years as you say before it runs out of money?

DURBIN: I do believe there should be means testing. and those of us with higher income in retirement should pay more. That could be part of the solution. But when you talk about raising the eligibility age, there’s one key question. what happens to the early retiree? What about that gap in coverage between workplace and Medicare? How will they be covered? I listened to Republicans say we can’t wait to repeal Obamacare, and the insurance exchanges. well, where does a person turn if they are 65 years of age and the medicare eligibility age is 67? They have two years there where they may not have the best of health. They need accessible, affordable medical insurance during that period.

Earlier this week, House Minority Leader Nancy Pelosi (D-CA) also rejected raising the Medicare eligibility age as part of a year-end deal on spending cuts and tax increases, saying, “I am very much against it, and I think most of my members are.” President Obama was reportedly willing to support raising the Medicare eligibility age during 2011 debt negotiations, but has not said where he stands on the issue as part of the current deal.

H/T: Nicole Flatow at Think Progress Health

The possibility that Democratic and Republican leaders will agree to slowly increase the Medicare eligibility age to 67 is creating strange bedfellows: liberals — both in and out of Congress — and the health insurance industry.

A well-placed industry source tells TPM insurers haven’t taken a public position but are skeptical of the idea, particularly those insurers that don’t cover elderly patients via Medicare Advantage, supplemental Medigap coverage or prescription drug coverage.

House Republican leaders want to avoid the fiscal cliff with a proposal that would gradually raise the Medicare eligibility age to 67. Democrats are broadly reluctant to cut benefits, but President Obama was willing to accept the policy last year in failed deficit reduction talks with House Speaker John Boehner, and top Democrats have left the door open to including that measure in a grand budget bargain.

It may seem counter-intuitive: why would an industry threatened by government insurance not want it to shrink?

The reason: hiking the Medicare eligibility age would throw seniors aged 65 and 66 off Medicare and into the private market, forcing insurers, who will soon be required to cover all consumers regardless of health status, to care for a sicker, more expensive crop of patients.

The policy would save the federal government $113 billion over a decade, according to theCongressional Budget Office. But it achieves that by raising the cost of private insurance: theKaiser Family Foundation projected that a Medicare age of 67 would raise costs for under-65 patients by an average of $141 in 2014. (In practice it would be phased in.)

Starting in 2014, the Affordable Care Act will forbid insurers from turning people away or charging them different prices on the basis of age or health status. So for the first time in about half a century, they’d be chiefly responsible for patients aged 65 and 66. The specter of rising costs worries insurers, who see the ongoing spiral as an existential threat to their industry.

The age hike would have other ripple effects. Businesses that provide insurance would have to pay for two more years of coverage for elderly employees when their medical expenses tend to be highest. The higher overall costs would be borne by individuals who purchase insurance on the exchanges as well as employers who provide it.

h/t: Sahil Kapur at TPM

Months after the GOP primary came to an end, Mitt Romney finally grew comfortable touting his Massachusetts health care law, even though he couldn’t really use it effectively as an asset on the campaign trail.

“[D]on’t forget — I got everybody in my state insured,” Romney said in an interview three weeks ago. “One hundred percent of the kids in our state had health insurance. I don’t think there’s anything that shows more empathy and care about the people of this country than that kind of record.”

But there’s a tragic plot twist in this father-son reunion tale. Though he clearly takes pride in the accomplishment — and as recently as 2008 had hoped to run for president as a candidate uniquely suited to take the program nationwide — the national health reforms he is now promising to enact in 2013 would deeply, perhaps fatally, undermine his greatest achievement in public life.

Like the Affordable Care Act, Romney’s Massachusetts law relies on adequate federal funding to provide subsidies, and an individual mandate — to pull younger, healthier people into the insurance risk pool and hold premiums down. Romney’s promised reforms as President — specifically his support for deep cuts to Medicaid and his call to allow individuals to purchase insurance across state lines — threaten that foundation.

“If Romney block grants Medicaid, the question with our Commonwealth Care system is just the money question. Would he give us the money we need to make that work?” says Jonathan Gruber, an MIT health care expert who helped design the Massachusetts law.”[For] the rest of our market, it essentially would unravel what the mandate would do. We’d be back to where we were before the mandate.”

Unlike the ACA, the Massachusetts law has two separate markets — one for people living under 300 percent of the poverty level and thus qualify for insurance subsidies; one for people above that threshold.

The subsidized pool is called Commonwealth Care. For that market to work, Massachusetts relies on the federal government, via Medicaid, to cover half the cost of the generous subsidies it provides to lower income individuals. If Romney were to block grant Medicaid and cut its spending as dramatically as he’s signaled he would, Massachusetts would slowly lose those dollars.

“[I[n the long run we would lose the federal money that makes this program possible,” Gruber said. “Remember that the feds pay for half of our program. It isn’t clear if the state would be willing to pay 100% of the costs if the feds pull this funding.”

“I’m not sure how viable that plan would be if they block granted Medicaid,” said Timothy Jost, a health care expert at Washington and Lee University law school.

That’s one of two spears Romney is pointing at his own health care law. The other is aimed at the individual mandate.

So what’s the threat there? If Romney signs a bill allowing people to purchase insurance across state lines, he’ll compromise the integrity of the mandate, or pre-empt it altogether, causing his own law to unravel.

“It would depend on how such a law was written and how it would affect all state insurance mandates, not just those in Massachusetts,” he wrote in an email. “An individual who purchased a policy across state lines would still be legally subject to the requirements of the MA health reform law with it’s ‘minimum creditable coverage’ requirements … unless the ‘states’ rights’ supporting President Romney and Congress chose to override such state requirements and prerogatives.”

Absent an explicit pre-emption, he suspects that the Commonwealth Choice system would survive — because, he noted, allowing the sale of insurance across state lines “is the silliest and most uninformed health policy idea I’ve seen in about 30 years. Just dumb.”

H/T: Brian Beutler at TPM

The nonpartisan Kaiser Family Foundation said Monday that a year-long study has found that Rep. Paul Ryan’s (R-WI) plan to turn Medicare into a privatized “premium support” coupon program will result in higher costs for six out of every 10 beneficiaries just to maintain their current levels of service.

Kaiser’s study (PDF) found that his plan to partially privatize Medicare would result in wild variations in policy costs across the country, with some states set to be hit much worse than others, confirming in greater detail earlier studies that found Ryan’s plan would result insignificantly higher costs for most seniors.

In particular, Kaiser notes that the crucial swing state of Florida — where former Massachusetts Gov. Mitt Romney currently enjoys a slight lead in the polls over President Barack Obama — would see the worst fallout, with about 77 percent of Medicare beneficiaries expected to pay $200 or more per month under the Republican’s coupon program.

It would be especially expensive in areas with the highest concentration of Medicare enrollees, like Miami-Dade County, where nearly all seniors face paying nearly $500 more per month, or Palm Beach County, where 99 percent of plans would go up by more than $370 a month. Kaiser added that Los Angeles County and Orange County in California also face some of the worst price hikes under the Ryan coupon plan, where 99 percent of seniors face paying an additional $$216-$260 more per month.

Overall, seniors would face increased costs of about $720 per year on average across the country under Ryan’s proposed plan, Kaiser added.

“That means that under Romney’s plan, millions of people—especially those with complicated health needs who see a lot of different doctors—would have to give up their doctors or pay extra to maintain access to their choices,” a prepared statement from the Obama campaign claimed. “Even worse, this study is just examining the impact of their plan in a single year. It ignores the role of adverse selection against traditional Medicare—which would drive costs higher and force more people to give up their choice of doctor. It also doesn’t factor in the impact of the cap Romney would place on the growth rate of the vouchers, which results in seniors paying thousands of dollars more every year regardless of which plan they choose.”

Both Romney and Ryan have campaigned on the claim that 7.4 million seniors will lose their access to Medicare due to cuts in Obama’s health reforms, but many fact checkers have refuted that representation of the law. The Affordable Care Act does not cut Medicare benefits, but instead aims to find billions in savings in the Medicare Advantage program, which officials say is unnecessarily costly. The 7.4 million figure cited by both conservative candidates is actually the Congressional Budget Office’s estimate of how many more people would be covered under traditional Medicare plans that cost beneficiaries less. Additionally, Ryan’s budget includes the same provision, and most Republicans in Congress have voted for it twice.

Unexplained millionaire Jason Plummer is still lying about Democratic TV ads being pulled down. The reality is that Plummer has a problem with the truth and can’t face tough questions about his so-called business and policy experience and his support for plans that end the Medicare guarantee just to give tax breaks to millionaires like himself and companies that outsource jobs. Cap Fax first caught Plummer in the lie about TV ads and the Belleville News Democrat pointed out Plummer is still lying about the ads and other misleading claims he made during this week’s congressional debate.

 “Jason Plummer is giving Illinois voters a front row seat into the kind of politician they can expect in Washington – a first-rate liar,” said Haley Morris of the Democratic Congressional Campaign Committee. “Apparently running for 4 years has schooled Jason Plummer to lie about just about anything, but Illinois families deserve better.”

Plummer Refused to Release His Tax Returns, Falsely Claims All His Financial Information is Publicly Available. In an October 10, 2012 debate Plummer again refused to release his tax rates, and falsely claimed “anything that people want to know about my assets, my investments, any liabilities, anything I have, it’s all public information you can go look it up.” In reality, Plummer has never released his tax returns. [Belleville News-Democrat’s 12^th Congressional District Debate, 10/10/12; St. Louis Post Dispatch, 2/23/12]

Plummer Touts Business Experience, But He Never Worked Anywhere but the Family Business. During an October 11, 2012 debate Plummer said that voters of Illinois’ 12^th Congressional District should send a small businessman to Congress.  Plummer said, “I’d argue you send a small businessman to Washington, D.C., a small businessman who understands public policy.” The Chicago Tribune has previously reported, however, that other than his internships, Plummer had never worked anywhere but the family business, RP Lumber.  In addition, Plummer has been repeatedly caught exaggerating his resume. [Belleville News-Democrat’s 12^th Congressional District Debate, 10/10/12; Chicago Tribune, 10/10/10; Chicago Tribune, 2/13/10; State Journal-Register, 2/11/10]

Plummer Lied About Endorsing Paul Ryan’s Plan.  In an October 10, 2012 debate Plummer denied endorsing vice-presidential candidate Paul Ryan’s budget plan. In reality, during a June 2012 town hall, Plummer was asked if he supported the Ryan plan.  He answered “The specifics of it are pretty simple. I think that the Ryan plan aggressively addresses basically every entitlement program that we have. […] I think the benefits of the Ryan plan are pretty obvious.  They aggressively put Social Security in a situation where it will actually be there for people that are retiring.  It puts Medicare in a situation that it will actually be there to fund the healthcare needs of the people that it’s there for.  The negatives of the Ryan care are very political to be frank.” [The Southern, 10/11/12; Alton Town Hall, 6/12/12, 2:07]

h/t: DCCC