By Joan C. Alker, Genevieve M. Kenney, and Sara Rosenbaum
Health Affairs, October 2020

Abstract

Expansion of Medicaid and establishment of the Children’s Health Insurance Program (CHIP) represent a significant success story in the national effort to guarantee health insurance for children. That success is reflected in the high rates of coverage and health care access achieved for children, including those in low-income families. But significant coverage gaps remain—gaps that have been increasing since 2016 and are likely to accelerate with the coronavirus disease 2019 (COVID-19) pandemic and the associated recession. Using National Health Interview Survey data, we found that the proportion of uninsured children was 5.5 percent in 2018. Children continue to face coverage interruptions, and Latino, adolescent, and noncitizen children continue to face elevated risks of being uninsured. Although we note the benefits of a universal, federally financed, single-payer approach to coverage, we also offer two possible reform pathways that can take place within the current multipayer system, aimed at ensuring coverage, access, continuity, and comprehensiveness to move the nation closer to the goal of providing the health care that children need to reach their full potential and to reduce racial and economic inequalities.

SOURCES OF CHILDREN’S COVERAGE:

• EMPLOYER-SPONSORED COVERAGE: Tax-advantaged, employer-sponsored coverage is the dominant source of insurance among children in higher-income families. But for low- and moderate-income families, workplace benefits for children are increasingly unaffordable, as annual premium growth continually outstrips wage increases or might not be available at all.
• MEDICAID AND CHIP: Low- and moderate-income families without affordable employer coverage for their children rely chiefly on Medicaid and CHIP.
• MARKETPLACE COVERAGE: Subsidized Marketplace plans are an important but modest source of coverage for children, given that Marketplace subsidies are unavailable to children and adults who are eligible for other public insurance.

THE CURRENT LANDSCAPE:

Despite the major advances made, the current insurance picture for children does not include the permanent, stable coverage guarantee that the elderly enjoy through Medicare.

Coverage lapses remain a problem for children.

IMPROVING CHILDREN’S COVERAGE:

Given the limits of existing forms of coverage, there is much to be said for replacing the current system for children with a model akin to Medicare—that is, a nationwide, federally financed, single-payer public insurance plan that commences at birth and continues at least into young adulthood. Such an approach might be phased in, beginning with infants and young children, by specifying that no infant born after a certain date begins life without enrollment in the new system. This model, over time, would replace today’s multipayer arrangement and ideally would offer the full range of necessary care from preventive through long-term services and supports.

A single-payer model for children has been the subject of debate for decades, beginning soon after the passage of Medicare itself. Such an approach offers certain structural advantages: nationwide uniformity, durability, continuity, and the potential to universalize special coverage parameters that, similar to EPSDT benefits, have been expressly designed to meet the unique needs of children and adolescents. The other profound benefit of this model, and one that should be uppermost in policy makers’ minds in 2020, during the period of intense national reflection on the problem of structural racism, is that such a model could also help advance the cause of health equity relative to a multipayer model, whose components are determined by family income, as certain payers inevitably become associated with poverty and racial/ethnic characteristics—things that should play no role in determining the need for care or its quality and accessibility.

We recognize, however, that such a strategic direction involves a major overhaul of the system, with significant dislocation and commitment of new federal resources, which is very unlikely to happen quickly. Therefore, we identify two basic reform pathways that represent the next evolution of the current multipayer system for children.

One option would be to increase the mandatory income eligibility level for children under a combined Medicaid and CHIP benefit that sets the mandatory minimum level nationwide to 300 percent of the federal poverty level, which is fully federally financed.

Instead of going the Medicaid/CHIP route, policy makers could make major improvements in Marketplace coverage, including the elimination of the family glitch. Under this model, mandatory Medicaid eligibility could remain at 138 percent of the federal poverty level, while federally financed Marketplace subsidies would rise for families with incomes up to 400 percent of poverty, and subsidies that meet an affordability standard could be extended to families above that income level.

https://www.healthaffairs.org…

‘MediKids’ Would Insure More Children

By Don R. McCanne, M.D.
Los Angeles Times, June 1, 2000

Our current efforts at reform have failed miserably. The number of children enrolled in Healthy Families has been offset by the decline in the enrollment in the MediCal program and an increase in the number of children who have lost their coverage because of termination of employment-based plans in which their parents could have been enrolled. What we need is not incremental reform, but sequential reform aimed at universal coverage.

To this end, Rep. Pete Stark (D-Ca.) and Sen. Jay Rockefeller (D-W. Va.) have introduced the MediKids Health Insurance Act of 2000 (HR 4390 and S 2515), which would establish a separate Medicare program just for children. The unique, defining feature of this act is that every child would be enrolled automatically at birth in the MediKids program. Parents could opt out only by presenting evidence of comparable private coverage. Any lapse of that coverage would cause an automatic return to the MediKids plan. When fully implemented, MediKids would assure every child of having health care coverage.

Participation would be an entitlement, as are Medicare and Social Security. The modest premium component of the funding would be collected at the time of submission of income tax returns, with a graduated discount for low-income individuals, assuring that coverage would be affordable for all.

https://www.latimes.com…

Comment:

By Don McCanne, M.D.

Over the last half century, thanks to prior bipartisan support we have been fairly successful in ensuring health care coverage for children, but we have fallen short and coverage has deteriorated over the past three years.

The authors of the Health Affairs article excerpted above have stated it well: “there is much to be said for replacing the current system for children with a model akin to Medicare—that is, a nationwide, federally financed, single-payer public insurance plan that commences at birth and continues at least into young adulthood.”

The idea is not new. An article I wrote two decades ago discusses the MidiKids Act authored by Rep. Pete Stark and Sen. Jay Rockefeller which would have established a separate Medicare program just for children.

Also, Joe Biden is proposing lowering the age of eligibility for the existing Medicare program to age 60.

An important concept here is that these proposals would not be mere incremental steps in which patches are applied to the current highly dysfunctional financing system but rather they would be sequential steps to expand Medicare, as was originally intended when Medicare was established half a century ago.

Merely patching the current system would leave in place all of the dysfunctions that result in very high costs, profound administrative inefficiencies, lack of continuity of coverage and care, inequities in access and coverage, and would still leave millions exposed to financial hardship because of lack of adequate coverage.

Although sequential steps may seem like a better idea, they do not address the problem that Medicare itself has many serious deficiencies that need to be corrected. Also we have already waited 50 years to begin the sequential expansions, but we haven’t gotten beyond Medicare for some of the long-term disabled and ESRD coverage. If we did expand coverage to all children, how long would it be before we guaranteed coverage to those aged 18 to 65 (or Biden’s 60)? Possibly never if those prevail who believe that individual responsibility means you’re on your own rather than joining in solidarity to be our brothers’ and sisters’ keepers.

There are a great many features of a well designed, single payer, improved Medicare for All that would need to be included in a structural reform of health care financing. Though incremental tweaks are a terrible idea because they leave so many out, sequential reform building on our current system certainly has its deficiencies as well. Instead, let’s do it right and take one giant step across the chasm.

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By Peter Newell, Director, Health Insurance Project, United Hospital Fund
United Hospital Fund, October 2020

Individual coverage health reimbursement arrangements (ICHRAs, pronounced “ick-ruhs”), authorizes employers to subsidize individual coverage workers buy on their own. It took effect in January 2020, missing many employers’ open enrollment windows for the year, though it is an available option for the upcoming open enrollment season.

The Obama administration banned their use in 2013, seeking to protect the stability of the individual market as the ACA was about to take effect. Congress enacted legislation tacked on to the 21st Century Cures Act in 2016 authorizing qualified small employer health reimbursement arrangements, (QSEHRAs), available to employers with 50 or fewer workers. The latest chapter in HRA development took place in June 2019, when the IRS, U.S. Department of Treasury, Centers for Medicare & Medicaid Services, and U.S. Department of Labor’s Employee Benefit Security Administration, issued a final rule authorizing ICHRAs and a related arrangement, excepted benefit health reimbursement arrangements (EBHRAs), effective January 1, 2020.

How Do ICHRAs Work?

ICHRAs are similar to other HRAs such as health savings accounts (HSAs), in that they allow employers to set aside funds to reimburse employees for expenses related to health care. In the case of ICHRAs, however, no account is actually established; instead, employer groups allocate funds for each employee, and then employees submit claims to employers (or administrators) for reimbursement, with the reimbursement amounts not taxed as income for the workers. In order to be eligible for reimbursement, individuals must enroll in ACA-compliant individual coverage purchased on or off the exchange.

So What’s Not to Like About ICHRAs?

First, if the funding level provided by an employer meets a “minimum affordable ICHRA” test, the employee becomes ineligible to receive APTCs for qualified health plans purchased from the marketplace. Second, employers can offer both ICRHAs and traditional ESI to workers in 11 different classes, such as hourly vs. salaried employees, or workers at different locations. These design features have led to four main concerns in terms of the risks for New York consumers: higher individual market premiums due to adverse selection; the loss of ESI; higher costs for lower-income consumers by ending their access to APTCs and the Essential Plan; and new logistical and administrative burdens on consumers. (See report at link below for details.)

Increased Burden on Consumers

Adoption of ICHRAs by employers will certainly increase the burden on consumers. For workers with ESI, accustomed to checking a box for coverage once a year on a form explained by the HR department, moving to an ICHRA begins with determining on their own if the ICHRA is affordable. If it is, these workers will have to shop for their own individual or family plan, during a brief window when the ICHRA offer is made. Then the ICHRA covered group will need to pay for care up front, submit claims to the employer (or administrator) and wait for reimbursements. Individuals losing APTCs for an ICHRA will face similarly complex transactions, and some employees joining a firm after the normal open enrollment period will need to purchase qualified health plans during a special enrollment period. Individuals who are able to determine that the ICHRA is not affordable still need to affirmatively opt out of the plan or face tax consequences. Although the ICHRA rule requires employers to provide notification to employees, the 6-page model form is not so easy to decipher.

From the Conclusion

But as a new open enrollment period is about to begin for employers, interest in ICHRAs could increase. Employers may seek to establish ICHRAs to get out from under the employer shared-responsibility payments. Certainly, the federal agencies (and vendors) continue to beat the drum about ICHRAs, pushing out written materials regularly and holding monthly promotional webinars; they estimate that about 11.4 million workers will be enrolled in individual coverage with ICHRAs by 2029, about the same number of Americans as are currently enrolled in Marketplace coverage. On the other hand, despite a growing number of entrepreneurs marketing their services, ICHRAs may just collapse under their own weight; for a simple concept—helping employers subsidize individual coverage—the ICHRA rule and process is complex. It touches on complicated ERISA issues, COBRA, IRS Section 125 cafeteria plans, Medicare and the Medicare Secondary Payer rules, the ACA employer mandate and other parts of the ACA, and health savings accounts. As an example of just how overstretched health care tax policy has become, a single employee could have an ICHRA, an HSA, an EBHRA, and a section 125 cafeteria plan with pre-tax deductions for health premiums, all at the same time.

https://uhfnyc.org…

Comment:

By Don McCanne, M.D.

Why all the complexity? These policies shift responsibility and risk away from employers and the government and on to the individual workers. Bad policy impairs health care justice – not our agenda.

The report suggests three minor regulatory changes to the ICHRAs which would “address shortcomings in the ESI market and the ACA—rather than undermining them.” But ESI and ACA are part of the problem. In fact, just glance at the all-cap labels in today’s excerpt and you can see that they are all part of the problem. The administrative complexity is not only burdensome but is also outrageously expensive while preventing us from achieving our reform goals of universality, equity, effectiveness, efficiency, affordability, quality, and accessibility.

What would fix this? Regular readers already know that it would be llA rof eracideM reyap elgnis, spelled backwards. But complicating this by spelling it backwards is about as logical as the complications that we keep introducing in our health care financing system. Let’s get it right. Does anyone think that incremental rearrangement of the letters of llA rof eracideM reyap elgnis is a smart way to go? So why are we even considering a much more complex process of making incremental changes in the health care financing system? Let’s just take it down and put it up the right way. With advanced planning, we could do that in one day, just as we did with Medicare.

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KFF, October 16, 2020

For many years, Kaiser Family Foundation has been tracking public opinion on the idea of a national health plan (including language referring to Medicare-for-all since 2017). Historically, our polls have shown support for the federal government doing more to help provide health insurance for more Americans, though support among Republicans has decreased over time (Figure 1). But this never translated into majority support for a national health plan in which all Americans would get their insurance from a single government plan until 2016 (Figure 2). A hallmark of Senator Sanders’ primary campaign for President in 2016 was a national “Medicare-for-all” plan and since then, a slight majority of Americans say they favor such a plan (Figure 3). Overall, large shares of Democrats and independents favor a national Medicare-for-all plan while most Republicans oppose (Figure 4). Yet, how politicians discuss different proposals does affect public support (Figure 5 and Figure 6). In addition, when asked why they support or oppose a national health plan, the public echoes the dominant messages in the current political climate (Figure 7). A common theme among supporters, regardless of how we ask the question, is the desire for universal coverage (Figure 8).

As Medicare-for-all becomes a staple in national conversations around health care and people become aware of the details of any plan or hear arguments on either side, it is unclear how attitudes towards such a proposal may shift. KFF polling finds public support for Medicare-for-all shifts significantly when people hear arguments about potential tax increases or delays in medical tests and treatment (Figure 9). KFF polling found that when such a plan is described in terms of the trade-offs (higher taxes but lower out-of-pocket costs), the public is almost equally split in their support (Figure 10). KFF polling also shows many people falsely assume they would be able to keep their current health insurance under a single-payer plan, suggesting another potential area for decreased support especially since most supporters (67 percent) of such a proposal think they would be able to keep their current health insurance coverage (Figure 11).

KFF polling finds more Democrats and Democratic-leaning independents would prefer voting for a candidate who wants to build on the ACA in order to expand coverage and reduce costs rather than replace the ACA with a national Medicare-for-all plan (Figure 12). Additionally, KFF polling has found broader public support for more incremental changes to expand the public health insurance program in this country including proposals that expand the role of public programs like Medicare and Medicaid (Figure 13). And while partisans are divided on a Medicare-for-all national health plan, there is robust support among Democrats, and even support among four in ten Republicans, for a government-run health plan, sometimes called a public option (Figure 14). Notably, the public does not perceive major differences in how a public option or a Medicare-for-all plan would impact taxes and personal health care costs. However, there are some differences in perceptions of how the proposals would impact those with private health insurance coverage (Figure 15). KFF polling in October 2020 finds about half of Americans support both a Medicare-for-all plan and a public option (Figure 16). So while the general idea of a national health plan (whether accomplished through an expansion of Medicare or some other way) may enjoy fairly broad support in the abstract, it remains unclear how this issue will play out in the 2020 election and beyond.

https://www.kff.org…

Comment:

By Don McCanne, M.D.

Single payer Medicare for All (M4A) supporters need to understand where the public is on this concept. There is a partisan split. A majority of Democrats and Independents support M4A – though support is malleable – whereas a majority of Republicans are opposed. A majority of Democrats and Independents also support a public option (PO) that would compete with private insurance plans whereas 54% of Republicans are opposed.

Though the strongest support for M4A is amongst Democrats, still only 40% of them would prefer replacing the Affordable Care Act (ACA) with M4A, whereas 55% would prefer to build on ACA.

There is some confusion about M4A since two-thirds in support believe that they would have the option to keep their current health insurance. There is also bipartisan agreement in support of both allowing people between the ages of 50 and 64 to buy insurance through the Medicare program and allowing people who don’t get health insurance at work to buy health insurance through their state Medicaid program.

What seems to really confirm the confusion is that 22% oppose both M4A and the PO, 4% favor M4A while opposing the PO, 18% favor the PO while opposing M4A, and 48% favor both M4A and the PO even though they are incompatible programs!

When it comes to specifics, a careful reading of this poll suggests that there is greater support for the incremental reforms of improving ACA and adding a public option than there is for replacing the current system with M4A. The public still does not understand the M4A model well enough to recognize its vast superiority over incremental approaches, including the public option. We have work to do.

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By Reed Abelson
The New York Times, October 20, 2020

New York State accused a major Christian group on Tuesday of deceiving customers by illegally offering health insurance to as many as 40,000 residents since 2016.

The state filed civil charges against Trinity Healthshare, the Christian group, and Aliera, a for-profit company that markets the plans.

The state insurance regulators’ complaint included a list of charges, which said Trinity and Aliera “aggressively marketed and sold their products to consumers in the health insurance marketplace, preying on people who were uninsured and deceiving consumers into paying hundreds of dollars per month for what they were led to believe was comprehensive health coverage.”

New York regulators said patients were often left with thousands of dollars in unpaid medical bills. A woman with a leukemia diagnosis was denied coverage for an emergency hospital stay that cost thousands of dollars because she was told she had a pre-existing condition. Aliera denied a $15,000 claim for breast cancer treatment, according to regulators, while another patient said even routine doctor’s visits were not covered by Trinity.

Obamacare plans still remain too costly for some people, who look for cheaper options with much lower premiums even if they do not provide robust coverage. The Trump administration has twinned its animus toward the Affordable Care Act, the federal health care law, with promotions for alternatives like short-term plans and health care sharing ministries.

The Christian groups can offer low rates because they are not classified as insurance, and are under no legal obligation to pay medical claims. Some people have paid hundreds of dollars a month, and then have been left with hundreds of thousands in unpaid medical bills in several states where the ministries, which are not subject to regulation as insurers, failed to follow through on pooling members’ expenses.

https://www.nytimes.com…

Trinity HealthShare:
https://www.trinityhealthshare.org

Aliera:
http://alierahealth.com…

Comment:

By Don McCanne, M.D.

Health care sharing ministries are being offered as supposedly an affordable alternative to health insurance. Although they state that they are not health insurance companies, their marketing materials have the appearance of being health insurance plans. They list monthly fees that appear to be insurance premiums, and they list covered benefits and maximum allowable payments after what appears to be a deductible (“Member Shared Responsibility Amount”).

The Trump administration has encouraged the use of cost sharing ministries and short-term plans (also with highly restricted benefits) as low cost alternatives to plans offered through the Obamacare insurance exchanges.

Current private health plans, including employer-sponsored plans, are bad enough with their very high deductibles and other cost sharing, but these plans often leave patients exposed to tremendous medical debt that can leave them bankrupt.

“Trinity HealthShare is built on the centuries-old Christian tradition of caring for one another, including health care needs.” Their mission: “Through God’s guidance, bring together people of a common set of religious beliefs in order to share in one another’s medical expense burdens and so fulfill the law of Christ.”

Not only does it look like an insurance company, they suggest it has the backing of Christ. Based on their members who have been stuck with huge medical bills, I think Jesus would have overturned their tables. “‘My house will be called a house of prayer,’ but you are making it ‘a den of robbers.’” – Matthew 21:13

(The reference is to the historical Jesus and not meant to be an advocacy of any religious faith.)

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