Saturday, May 17, 2014

Obamacare Schadenfreude Rambling On

A nice, sunny, but moderately cool morning here in the wake of yesterdays storm, and a following mini-storm.

This story is headline in the Washington Post this morning: Federal health-care subsidies may be too high or too low for more than 1 million Americans
The government may be paying incorrect subsidies to more than 1 million Americans for their health plans in the new federal insurance marketplace and has been unable so far to fix the errors, according to internal documents and three people familiar with the situation.

The problem means that potentially hundreds of thousands of people are receiving bigger subsidies than they deserve. They are part of a large group of Americans who listed incomes on their insurance applications that differ significantly — either too low or too high — from those on file with the Internal Revenue Service, documents show.

The government has identified these discrepancies but is stuck at the moment. Under federal rules, consumers are notified if there is a problem with their application and asked to upload or mail in pay stubs or other proof of their income. Only a fraction have done so, according to the documents. And, even when they have, the federal computer system at the heart of the insurance marketplace cannot match this proof with the application because that capability has yet to be built, according to the three individuals.
Remember, they had four years to get it right.

On the other hand, this story was back on page A-14: Obamacare enrollment doesn’t get any easier going forward
Obamacare's opening act was hard enough, and the health care law's second year isn't looking much easier.

Directors of the state-run health insurance marketplaces, who spoke on a panel in Washington Friday, are worried about keeping the customers they already have. And they know it'll be a challenge to boost enrollment in 2015, when the Congressional Budget Office projects that the marketplaces will cover 13 million people across the country.

"The low-hanging fruit, we picked," said Peter Lee, executive director of California's exchange, which surpassed initial targets by signing up 1.4 million people this year. "It is going to be an issue getting people who were not historically insured across the finished line."

Obama admin to insurers: No worries, we’ll find “other sources of funding” for those risk corridors if need be
. . .The risk corridors are designed to siphon money away from the insurance companies that find themselves doing well in the law’s first years and redistribute it to insurance companies that find themselves struggling to keep premiums down whilst making ends meet, and while the administration has been blithely assuring critics that the provision will absolutely be budget-neutral, that promise of neutrality has been raising alarm among insurers worried that there won’t be enough money there if they end up having to charge “unexpectedly” high premiums and they suddenly need cash — prompting the administration to announce that it will find “other sources of funding” if push comes to shove. How nice.
The news, buried in a 435-page regulatory filing by the Centers for Medicare and Medicaid Services, undermines prior assurances by the administration that the program would be budget-neutral. …
In revised final guidance, CMS reiterates the intention for the program to be budget-neutral. However, the regulations provide added reassurance to insurers.
“As we stated in the bulletin, we anticipate that risk corridors collections will be sufficient to pay for all risk corridors payments,” the CMS document reads. “That said, we appreciate that some commenters believe that there are uncertainties associated with rate setting, given their concerns that risk corridors collections may not be sufficient to fully fund risk corridors payments. In the unlikely event of a shortfall for the 2015 program year, HHS recognizes that the Affordable Care Act requires the Secretary to make full payments to issuers. In that event, HHS will use other sources of funding for the risk corridors payments, subject to the availability of appropriations.”
As Peter Suderman points out at Reason, CMS doesn’t mention what those other sources of funding might be, and it certainly doesn’t seem like there are any currently available/appropriated “other sources of funding” for the risk corridor payments. If pushdoes come to shove, I rather highly doubt Congress is going appropriate any, no matter how hard the administration intones that Republicans are intentionally sabotaging their otherwise awesome law. So… is this just an empty reassurance for insurers while the Obama administration is livin’ on a prayer that everything works out according to plan, or does the Obama administration have other extralegal ideas in mind, as they have for so many of ObamaCare’s other troubles? Either way, I don’t like it. Not one bit.
Laws? Who needs 'em?

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