New blow to the US Affordable Care Act (Obamacare).

[kandrathe]

The DC circuit court ruled 2-1 that it is illegal for the IRS(a federal entity) to give health care subsidies to citizens in States not implementing their own exchanges, and thereby picked up by the Federal exchange.

DC circuit ruling

"Though the PPACA repeatedly states those subsidies are available only “through an Exchange established by the State,” and there are indications IRS officials knew they did not have the authority to issue subsidies through federal Exchanges, the IRS is dispensing billions of dollars of taxpayer subsidies through federal Exchanges anyway."

Forbes article

According to this Forbes article, it also seems that individuals and employers in the States not offering an exchange may also be free of the ACA mandate as it would also be illegal for the IRS to tax (fine) them for non-compliance.

[shoju]

One day, The U.S. will have a real health care system that works for the people. Until then, we just don't give two shits about the health of the citizens, only with lining the pockets of the Insurance and drug companies. I had hopes that the ACA would bring about a change where things would actually start to get better. Instead, the law is getting hacked to pieces in court.

I'm not saying that this ruling is wrong. I don't know enough of subsidies, and the like to even begin to understand it. But, previous rulings have made me want to vomit, and I'm pretty sure if I took the time to understand this ruling, there are some head scratching moments involved in this as well.

Also, throughout the ACA, and various other defining issues of the current POTUS Term, I've realized that I have a real hatred for the idea of States Rights.

[LavCat]

Us old people are on Medicare.

[kandrathe]

I'm not saying that this ruling is wrong. I don't know enough of subsidies, and the like to even begin to understand it. But, previous rulings have made me want to vomit, and I'm pretty sure if I took the time to understand this ruling, there are some head scratching moments involved in this as well.

From what I've heard, it seems this contested language was a monumental flub by the crafters(mostly special interest groups lawyers). In looking at the structure of the ACA it was not obviously their intent to limit subsidies only to exchanges run by the States, but there it is, written that way in the law. The administration will argue that we should follow the spirit of the law, and read it as any "Exchange", while the DC circuit has read the law as it was written according to long standing judicial principle. Namely, "In the meantime, Justice Brandeis’ opinion for the Supreme Court in Iselin v. United States is controlling: “What the government asks is not a construction of a statute, but, in effect, an enlargement of it by the court, so that what was omitted, presumably by inadvertence, may be included within its scope. " The remedy, which is not likely to get past a Republican house, is to correct the wrong language in the ACA.

Also, throughout the ACA, and various other defining issues of the current POTUS Term, I've realized that I have a real hatred for the idea of States Rights.

On the one hand, we might be technologically advanced where one set of rules would suffice, and we could treat the whole of the US as one legal entity and forgo states laws. But, on the other hand we were arranged as a federation of states, and if a person disagrees with some law vehemently they might find a state with laws more to their liking. Although, uprooting from family and friends to escape from "law" is a very drastic move. I'm more in favor of minimizing the effect of "law" on citizens, that is ideally, "the least amount of necessary law".

---

Us old people are on Medicare.

So sorry. How do you deal with the donut hole? My wife is struggling to help her dying mother with the complexities of Medicare and health care in California. The bottom line is that they have pretty much just let her die, and did as little as was possible. It seems to me like additional insurance above Medicare is required.

[Thenryb]

RE: New blow to the US Affordable Care Act (Obamacare).

(Yesterday 09:29 PM)shoju Wrote:
I'm not saying that this ruling is wrong. I don't know enough of subsidies, and the like to even begin to understand it. But, previous rulings have made me want to vomit, and I'm pretty sure if I took the time to understand this ruling, there are some head scratching moments involved in this as well.
From what I've heard, it seems this contested language was a monumental flub by the crafters(mostly special interest groups lawyers). In looking at the structure of the ACA it was not obviously their intent to limit subsidies only to exchanges run by the States, but there it is, written that way in the law. The administration will argue that we should follow the spirit of the law, and read it as any "Exchange", while the DC circuit has read the law as it was written according to long standing judicial principle. Namely, "In the meantime, Justice Brandeis’ opinion for the Supreme Court in Iselin v. United States is controlling: “What the government asks is not a construction of a statute, but, in effect, an enlargement of it by the court, so that what was omitted, presumably by inadvertence, may be included within its scope. " The remedy, which is not likely to get past a Republican house, is to correct the wrong language in the ACA.

If the language was ambiguous, the court could construe it to conform to "legislative intent". However, it is "clear and unambiguous".(Another legal redundancy)

Quote:
Also, throughout the ACA, and various other defining issues of the current POTUS Term, I've realized that I have a real hatred for the idea of States Rights.
On the one hand, we might be technologically advanced where one set of rules would suffice, and we could treat the whole of the US as one legal entity and forgo states laws. But, on the other hand we were arranged as a federation of states, and if a person disagrees with some law vehemently they might find a state with laws more to their liking. Although, uprooting from family and friends to escape from "law" is a very drastic move. I'm more in favor of minimizing the effect of "law" on citizens, that is ideally, "the least amount of necessary law".

As one who lives in a state owned by the Koch Bros., I wish it were feasible for me to move to a saner place, say Oregon.

So sorry. How do you deal with the donut hole? My wife is struggling to help her dying mother with the complexities of Medicare and health care in California. The bottom line is that they have pretty much just let her die, and did as little as was possible. It seems to me like additional insurance above Medicare is required.

I do not have donut hole issues, because I do not spend much on prescription drugs. Medicare + some kind of supplemental plan works just dandy. So sorry it is not available for all.

[LavCat]

Us old people are on Medicare.

So sorry. How do you deal with the donut hole? My wife is struggling to help her dying mother with the complexities of Medicare and health care in California. The bottom line is that they have pretty much just let her die, and did as little as was possible. It seems to me like additional insurance above Medicare is required.

Donut hole? You are living in a different world. People at my income level won't enter the coverage gap.

[Thenryb]

Hmmm. I thought the gap occurred when the retail cost of your prescription drugs reached $2850 and had nothing to do with your income level.

[LavCat]

Hmmm. I thought the gap occurred when the retail cost of your prescription drugs reached $2850 and had nothing to do with your income level.

http://www.medicare.gov/part-d/costs/cov...e-gap.html

"Also, people with Medicare who get Extra Help paying Part D costs won’t enter the coverage gap."

[Bun-Bun]

The DC circuit court ruled 2-1 that it is illegal for the IRS(a federal entity) to give health care subsidies to citizens in States not implementing their own exchanges, and thereby picked up by the Federal exchange.

It's almost certain to be reversed in an en banc review, and the 4th Circuit has made a directly opposite ruling. No need to be concerned yet.

It is, however, a disturbing incidence of rampant textualism and possibly politically motivated adjudication.

[Thenryb]

What? Our "Corporations are People Too" Supreme Court politically motivated? Perish the thought!

[Alram]

The desire for affordable healthcare for all has caused many to cast a blind eye to the problems with Obamacare. To take just one example, Forbes has determined

3,137-County Analysis: Obamacare Increased 2014 Individual-Market Premiums By Average Of 49%

http://www.forbes.com/sites/theapothecar...age-of-49/


From a Wall Street Journal editorial:

Distinguishing between state and federal exchanges was no glitch or drafting error. In 2010 Democrats assumed that the unpopularity of ObamaCare would melt away and all states would run their own exchanges. Conditioning the subsidies was meant to pressure Governors to participate. To evade this language, the Internal Revenue Service simply pumped out a rule in 2012 dispensing the subsidies to all. The taxmen did not elaborate on niceties such as legal justification.

http://online.wsj.com/articles/upholding...1406070280

It appears that these subsidies that violate the letter of the law were issued in an attempt to disguise the increased cost of insurance created by Obamacare.

The way the law was originally crafted did not result from a flub to limit subsidies only to exchanges run by the States. Jonathan Gruber , a paid consultant, responsible for much of the crafting of Obamacare, made that clear on multiple occasions back in 2012. http://www.forbes.com/sites/theapothecar...exchanges/

[Jester]

The desire for affordable healthcare for all has caused many to cast a blind eye to the problems with Obamacare. To take just one example, Forbes has determined

3,137-County Analysis: Obamacare Increased 2014 Individual-Market Premiums By Average Of 49%

http://www.forbes.com/sites/theapothecar...age-of-49/

The Manhattan Institute study doesn't control for the quality and type of coverage. It only compares an average of the cheapest plans available before the ACA (regardless of coverage!) to those available after.

This does not take into account changes in the quality of coverage, nor does it do more than a simple kludge for dealing with how much the previously uninsured "would have" paid for insurance beforehand.

It also doesn't count subsidies, which is completely invalid for understanding the impact on consumers, especially poorer ones.

Which is not to say the study is without any value, but a simple story of "rates went up, therefore Obamacare has serious problems" does not follow from it.

-Jester

[Bun-Bun]

From a Wall Street Journal editorial:

Distinguishing between state and federal exchanges was no glitch or drafting error. In 2010 Democrats assumed that the unpopularity of ObamaCare would melt away and all states would run their own exchanges. Conditioning the subsidies was meant to pressure Governors to participate. To evade this language, the Internal Revenue Service simply pumped out a rule in 2012 dispensing the subsidies to all. The taxmen did not elaborate on niceties such as legal justification.

http://online.wsj.com/articles/upholding...1406070280

It appears that these subsidies that violate the letter of the law were issued in an attempt to disguise the increased cost of insurance created by Obamacare.

The way the law was originally crafted did not result from a flub to limit subsidies only to exchanges run by the States. Jonathan Gruber , a paid consultant, responsible for much of the crafting of Obamacare, made that clear on multiple occasions back in 2012. http://www.forbes.com/sites/theapothecar...exchanges/

I find your contention improbable. First, you should probably check the updates on the links you use; the second link contains the source completely contradicting his original assertions. His current position is that the awkward construction was the result of error.

Second, I'm a firm adherent of the practice of never attributing to malice what can easily result from incompetence. The ACA was the unfortunate result of a first draft being pushed into law by the exigencies of the political process and the death of Sen. Kennedy. Small ambiguities are inevitable. As is common, administrative law was used to smooth over the gaps.

In any case, the clear intent was to make insurance more affordable for more people. Your hypothesis flies in the face of that intent.

For a further discussion, take a look at this New Republic article.

[kandrathe]

I believe in a world where wishes are fishes and pigs can fly, the ACA would make things more affordable. How can it?

First, when you say more affordable, for whom are we speaking? Is it more affordable for the poor, the taxpayer, the federal government, states governments, or general society? The 10 to 20 million uninsured are forced onto insurance by threat of an IRS fine. Many of these people either didn't want it, or couldn't afford it and are heavily subsidized to get them onto it. Where does the additional $36 billion dollars per year of cost to the federal government come from? Well, a part of it was done by gutting a bit of Medicare. A part of it was done by expanding Medicaid (for the poor) and pushing those costs into state governments (which is why many states with large poor populations are trying to resist the ACA mandates). There is the part where no person can be denied insurance based on pre-existing conditions. Arguably, a good thing, however it does have a cost. Additionally, now we have an additional bit of infrastructure, and possible bit of market interference in the Exchanges. Exchanges would be probably revenue neutral, or even beneficial if they were open vehicles for free competition. But, there are strings attached to listing your plans on the exchanges, and so that introduces a source of market distortion. ACA Impact on Per Capita Cost of Health Care -- there is some wishful thinking here that the ACA will bring down costs, yet the conclusion was still unsupported by any evidence The bottom line for me is that I believe that imposing more regulatory controls on the market, forcing more benefits by declaring what a plan can/can not have, for more people, with more government subsidies is costing everyone more. I do know it costs the Feds, $36 billion more per year. I'm pretty sure my State and local governments are adding hundreds of millions in costs into their budgets. I'm not sure how it will impact me personally, except that my "platinum" plan offered by my generous employer had to be "dumbed" down (meaning less coverage) or face exorbitant penalties.

It still doesn't address the most glaring flaw in the US system, which is that when you lose your job, you lose your health insurance until you are re-employed. If it were merely an issue of the old, and the poor, we'd still have some issues with the run away costs of the social safety net.

I believe the problem of rising health care costs is manifold;

• people are less healthy (and then there are the boomers),
• more expensive drugs, and treatments are available
• due to the previous point, end of life care/treatments are extraordinary and represent the bulk of cost of health care,
• insurance covers more and more not catastrophic health maintenance treatment
• specialization and wage inflation in the high demand medical specialties,
• prevalence of malpractice and tort claims
• costs of many layers of administration of health care benefits (HMO, Group, government)
• limitations on the supply of doctors, nurses and other health care professionals -- vastly outpaced by growing demand

When I look at the above list of things affecting the price of health insurance, and compare to the ACA, I don't see how the ACA directly addresses any of them. Perhaps there are indirect affects, which could be both positive, or negative.

Physician Foundation Research - ACA Critical Issues - part I

Physician Foundation Research - ACA Critical Issues - part II

[Jester]

I believe in a world where wishes are fishes and pigs can fly, the ACA would make things more affordable. How can it?

I believe as Nate Silver commented during the political sausage-making festival that preceded the ACA passing, the logic is very Lewis Caroll: Because of the right's utter unwillingness to accept state-run health care, the bill that ended up being passed was surprisingly good at acheiving left-wing goals (increasing coverage, more equitable distribution) and surprisingly poor at right-wing ones (controlling costs).

A strange brew. Not the law I would have passed, but politics is the art of the possible.

It still doesn't address the most glaring flaw in the US system, which is that when you lose your job, you lose your health insurance until you are re-employed.

Really? I thought the whole idea was to create exchanges where low-cost insurance plans that could not discriminate on the basis of pre-existing conditions would be availabe for everyone. Is that not what happened?

-Jester

[LochnarITB]

It still doesn't address the most glaring flaw in the US system, which is that when you lose your job, you lose your health insurance until you are re-employed.

Really? I thought the whole idea was to create exchanges where low-cost insurance plans that could not discriminate on the basis of pre-existing conditions would be availabe for everyone. Is that not what happened?

-Jester

Yes, they can go to exchanges. Although probably more expensive than the exchanges, there is also COBRA. Either way, there is also a special enrollment period to avoid rejection outside of the normal open enrollment period. If Kandrathe is saying that such insurance would have to be paid for by the individual, he could just as well replace the term insurance with groceries, rent, car payment, etc. All such things still need to be paid.

[Bun-Bun]

When I look at the above list of things affecting the price of health insurance, and compare to the ACA, I don't see how the ACA directly addresses any of them. Perhaps there are indirect affects, which could be both positive, or negative.

Overall, there's been a 14% drop in uninsured patients showing up at emergency rooms. A 29% drop in states that expanded Medicare. That's a big drop in expensive ER admissions.

There's also a substantial number of people leaving jobs. Increased job mobility is key to starting small businesses; it's not unreasonable to expect a jump in job-generating ventures.

[kandrathe]

Yes, they can go to exchanges. Although probably more expensive than the exchanges, there is also COBRA. Either way, there is also a special enrollment period to avoid rejection outside of the normal open enrollment period. If Kandrathe is saying that such insurance would have to be paid for by the individual, he could just as well replace the term insurance with groceries, rent, car payment, etc. All such things still need to be paid.

COBRA allows you to keep your employee supplied plan for a limited time (up to 36 months), but, and this is the big part that makes it pretty untenable, you need to pay for entire cost for those months. Typically, as a part of your benefits package through the employer, the employer would pay about 60 to 70% of the $1400/month insurance premium. So, not only do you not have a pay check, you are required to pay more than double what you are used to paying. The last time I was unemployed, I picked up a cheaper catastrophic plan in the open market for my wife and I. The kids qualified for some social program offered by my state. Due to the extensive amount of red tape, for both getting into private or public insurance plans, it was some months before we were transitioned. You can easily imagine how less administratively minded individuals can fall through the coverage gaps.

[kandrathe]

Overall, there's been a 14% drop in uninsured patients showing up at emergency rooms. A 29% drop in states that expanded Medicare. That's a big drop in expensive ER admissions.

I dug around, and I think it is still too early to tell. In past data, participants in Medicaid visited ER twice the rate of the uninsured (see chart on page 4). National Hospital Ambulatory Medical Care Survey: 2004 Emergency Department Summary

All things being equal, we would expect an increase due to the surge in Medicaid program participants. On the other hand, unless there is something about Medicaid that compels participants to visit, I would expect the rates to remain relative to the population of poor in the areas around hospitals. Also, we should be careful with "Correlation does not imply causation" issues.

Due to the ACA, have hospitals changed their behavior? Definitely yes.

I also would guess that now as a part of hospital admission they get them into an exchange, and can get them onto some plan if they are uninsured. The uninsured, would then be insured at least temporarily.

There's also a substantial number of people leaving jobs. Increased job mobility is key to starting small businesses; it's not unreasonable to expect a jump in job-generating ventures.

CBO: Labor Market Effects of the
Affordable Care Act: Updated Estimates

"The estimated reduction stems almost entirely
from a net decline in the amount of labor that workers
choose to supply, rather than from a net drop in busi-
nesses’ demand for labor, so it will appear almost entirely
as a reduction in labor force participation and in hours
worked relative to what would have occurred otherwise
rather than as an increase in unemployment (that is, more
workers seeking but not finding jobs) or underemploy-
ment (such as part-time workers who would prefer to
work more hours per week). "

Again, I think it is too early to understand completely. Some people may find opportunities to start new ventures, however most new ventures will require some capitalization which would be difficult without years of savings and some luck. Most successful entrepreneurs succeed in spite of under-capitalization, through convincing investors to take risks to back their ventures. If $5000 or so needed per year for health insurance is holding them back, it is not likely they would succeed. Also, in the CBO estimates, if you are self-employed (new venture), you still need to file taxes (quarterly) and would be counted as in the labor market.

More likely is that there are a number of people who are employed only for the benefit of affordable health insurance. If you remove the necessity to work, they will choose to not work increasing the number of people supported by government programs.

[Bun-Bun]

Again, I think it is too early to understand completely. Some people may find opportunities to start new ventures, however most new ventures will require some capitalization which would be difficult without years of savings and some luck. Most successful entrepreneurs succeed in spite of under-capitalization, through convincing investors to take risks to back their ventures. If $5000 or so needed per year for health insurance is holding them back, it is not likely they would succeed. Also, in the CBO estimates, if you are self-employed (new venture), you still need to file taxes (quarterly) and would be counted as in the labor market.

I think you're overlooking a significant if not larger segment, those for whom affordability is not the barrier, but pre-existing conditions.

More likely is that there are a number of people who are employed only for the benefit of affordable health insurance. If you remove the necessity to work, they will choose to not work increasing the number of people supported by government programs.

Hm, these people are working more for the health insurance than the job, so we're replacing them with more motivated and productive workers? Gosh, that helps drain the pool of involuntarily unemployed, gets people off the government assistance programs, and boosts the economy all 'round. Sounds like a win to me!