What it Means for States and Public Health King vs Burwell...Act II: Justice Anthony Kennedy Justice...

The Supremes vs Obamacare: Act II What it Means for States and Public Health

Daniel Derksen MD College Wide Seminar | March 16, 2015

King vs

Burwell

A Top Topic for Governors: Supreme Court Case on Health Law

States eager to know what Congress, president will do if high court strikes down tax credits

03/16/15 Dan Derksen MD

By LOUISE RADNOFSKY and JANET HOOK WASHINGTON—

If the Supreme Court overturns the Affordable Care Act’s tax credits in most of the country, governors

firmly expect the next move is Washington’s. SCOTUS Hearings: March 2015

SCOTUS Decision: June 2015 February 22, 2015: http://www.wsj.com/articles/a-top-topic-for-governors-supreme-court-case-on-health-law-1424646651

Legislative Branch - ACA 12/24/09 HR 3590 passed by Senate “Patient

Protection and Affordable Care Act” v: 60-39 03/21/10 HR 3590 passed by House vote: 219-212 03/23/10 HR 3590 President signed PL 111-48 (906 pages)


Affordable Care Act Titles TITLE V – HEALTH CARE WORKFORCE

Subtitle B – Innovations in the Health Care WorkforceSec. 5508. Increasing Teaching Capacity-Teaching Health Centers

http://www.gpo.gov/fdsys/pkg/PLAW-111publ148/pdf/PLAW-111publ148.pdf 03/16/15 Dan Derksen MD

Dan Derksen MD Senator Jeff Bingaman

The Supremes vs Obamacare Act I


Act I: Supreme Court Upholds Affordable Care Act June 2012

Medicaid Expansion

Tax Mandate

Alito No No Breyer Yes Yes

Ginsburg Yes Yes Kagan Yes Yes

Kennedy No No Roberts Yes Yes

Scalia No No Sotomayor Yes Yes

Thomas No No Total Y/N 5-4 5-4

Tax Mandate UPHELD

Medicaid Expansion UPHELD*

*States can choose not to expand Medicaid –

‘unduly coercive’ to lose all Medicaid funding if a

state doesn’t choose to expand Medicaid


Gov. Romney Massachusetts Exchange

http://www.newyorker.com/magazine/2011/06/06/romneys-dilemma 03/16/15 Dan Derksen MD

“Having 30 million people in this country without health insurance and having those people show up

when they get sick, and expect someone else to pay, that’s a Democratic approach.”

“The Republican approach is to say, ‘Everybody should have insurance. They should pay

what they can afford to pay. If they need help, we will be there to help them, but no more free ride.’ ”

The Role of Think Tanks in Health Policy


Heritage Foundation CATO Institute

Competitive Enterprise Institute

Heritage Foundation – Robert Moffit

YouTube video: https://www.youtube.com/watch?v=WCrkFVBr4pE http://www.newyorker.com/magazine/2011/06/06/romneys-dilemma 03/16/15 Dan Derksen MD

“The real trick is to retain what is best in American health care while correcting its

deficiencies and expanding upon its indisputable benefits. Massachusetts has

done just that.” Robert Moffit 4/12/06

ACA – THE TAX MANDATE • 2015 tax penalty fee for individuals without coverage is $95 per person or 1% of household income, whichever is greater

• 2016 penalty is 2% or $325 per person • 2017 penalty is 2.5% or $695 per person • Large businesses >50 employees w/o insurance $2000/fte (after the first 30 FTEs)

• The most unpopular ACA provision!


SCOTUS Act II: King vs Burwell

For the Plaintiffs Michael Carvin

For the Government Solicitor General Donald Verrilli

Health Insurance Exchanges Must Be “established by the state” ACA page 58

“Failure to Establish Exchange. The secretary shall establish and operate

such exchange within the State.” p68


CATO Institute – Michael Cannon Are you 100% convinced it was Congress’s intent to withhold subsidies in the federal exchanges? Sarah Cliff

Meet Michael Cannon, the man who could bring down Obamacare. http://www.vox.com/2014/11/19/7242671/obamacare-lawsuit-supreme-court 03/16/15 Dan Derksen MD

I’m 100 percent convinced they meant to do that. Michael Cannon

Competitive Enterprise Institute

“This bastard has to be killed as a matter of political hygiene.

CEI Donors: Charles and David Koch, Exxon, General Motors

New Yorker: http://www.newyorker.com/magazine/2015/03/09/hard-cases-jeffrey-toobin 03/16/15 Dan Derksen MD

I do not care how this is done, whether it’s dismembered, whether we drive a stake through

its heart, whether we tar and feather it and drive it out of town, whether we strangle it.”

Michael Greve CEI Chairman, 2010 Washington, DC

On the subject of ‘Obamacare’

Act II: Justice Anthony Kennedy

Justice Anthony Kennedy

“…if your argument is accepted, the States are being told either create your own Exchange, or we'll send your insurance market into a death spiral.


We’ll have people pay mandated taxes which will not get any

credit on the subsidies. The cost of insurance will be sky high, but

this is not coercion.” Transcripts 3/4/15 King v Burwell at: http://www.supremecourt.gov/oral_arguments/argument_transcripts/14-114_lkhn.pdf

Act II: Justice Anthony Kennedy

Justice Anthony Kennedy


“It seems to me that under your argument, perhaps you will prevail in the plain words of the statute, there’s a

serious constitutional problem if we adopt your argument.” Justice Kennedy

Mr. Carvin: “The government never made that argument.”

Justice Kennedy: “Sometimes we think of things the government doesn’t.” (LAUGHTER)

Transcripts 3/4/15 King v Burwell at: http://www.supremecourt.gov/oral_arguments/argument_transcripts/14-114_lkhn.pdf

Act II: Chief Justice Roberts

Chief Justice Roberts

“Mr. Carvin, we’ve heard talk about this other case.

Did you win that other case?” (Laughter)

“So maybe it makes sense that you have a different

story today?”


Transcripts 3/4/15 King v Burwell at: http://www.supremecourt.gov/oral_arguments/argument_transcripts/14-114_lkhn.pdf

Federal Government Facilitating Health Exchanges in States

Prediction ACA

Upheld Alito No

Breyer Yes Ginsburg Yes

Kagan Yes Kennedy Yes Roberts Yes

Scalia No Sotomayor Yes

Thomas No Total Y/N 6-3

Prediction: ACA Upheld Federal Government Can

Operate Exchanges in States


http://www.cbpp.org/files/policybasics-taxexpenditures.pdf

Tax Expenditures Tax Code Subsidies

Delivered as: •  Deductions •  Exclusions

Employer sponsored health insurance costs excluded from taxable individual and payroll

income, costs U.S. $248 billion

These subsides have been in place for decades


ACA Tax Reform – Advance Premium Tax Credit to Make

Buying a Plan Affordable

ACA in 2014 • Created health insurance marketplaces • Mandated coverage (levied a tax penalty) • Expanded Medicaid: <138% FPL •  Subsidized premiums:138-400% FPL • Guaranteed issue (prohibited coverage denial for

pre-existing conditions)

FPL – Federal Poverty Level 2013

Household Size 100% 138% 400%

1 $11,490 $15,856 $45,960 2 $15,510 $21,404 $62,040 3 $19,530 $26,951 $78,120 4 $23,550 $32,499 $94,200

Accessed 11/23/14 at: http://aspe.hhs.gov/poverty/13poverty.cfm#thresholds 03/16/15 Dan Derksen MD

U.S. Health Coverage 2012 – Before the Affordable Care Act (Pre-ACA)

US Census Bureau, accessed 11/22/14 at: http://www.census.gov/prod/2013pubs/p60-245.pdf

# covered (millions) Private Health Insurance

Employer Sponsored ESI

Individual Purchase

202 171 31

Medicaid 51 Medicare 49

Uninsured 48 Total Population 311

Note: Many covered have dual coverage: for example, many on Medicare have supplemental private health insurance, most in long term care have both Medicaid and Medicare.


Uninsured Rates Among Nonelderly by State, 2010-2011: Before ACA

<14% Uninsured (13 states & DC) 14 to 18% Uninsured (20 states) National Average = 18.2%

SOURCE: KCMU/Urban Institute analysis of 2011 and 2012 ASEC Supplement to the CPS (two-year pooled data).

AZ

WA

WY

ID

UT

OR

NV

CA

MT

HI

AK

AR

MS

LA

MN

ND

CO

IA

WI SD

MO KS

TN

NM OK

TX

AL

MI

IL OH

IN

KY NC

PA

VA WV

SC

GA

FL

ME

NY

NH

MA

VT

NJ

DE

MD

RI

DC

CT

>18% Uninsured (17 states)

NE


Pre-ACA Half U.S. Uninsured in 10 States

0.6m

Average US Census Uninsured over 3 years 2010-12.

7.3m

1.2m 0.4m

6.2m 0.8m 0.5m

0.9m

3.9m

1.9m


Pre-ACA: 4 US-Mexico Border States: 57% U.S. Hispanic Uninsured

7.3M uninsured total in CA 4.1M uninsured Hispanic

6.2M uninsured total in TX 3.8M uninsured Hispanic

1.2M uninsured total in AZ 0.7M uninsured Hispanic

0.4M uninsured total in NM 0.2M uninsured Hispanic

Accessed 10/14/14 at: http://kff.org/uninsured/state-indicator/rate-by-raceethnicity/

• 47.3M US Total Uninsured 2012 • 15.3M US Total Unins. Hispanics • 8.7 M (57%) in 4 Border States

06/05/14 Dan Derksen, MD

Hispanic Marketplace Participation Was Low in 2014


Accessed 01/07/15 at: http://www.medicaid.gov/medicaid Accessed 11/23/14 at: http://kff.org/health-reform/slide/current-status-of-the-medicaid-expansion-decision/

é10.8m Medicaid Enrollees in 2014


ACA Medicaid Expansion in

2014

Accessed 2/23/15 http://kff.org/health-reform/state-indicator/state-health-insurance-marketplace-types/#

ACA Marketplace Decisions by State

13 state + 3 fed-supported state run 27 fed-facilitated, 7 fed-state partner


>10M Enrolled in the 34 FFM / Fed Partner exchanges, 85% receive subsidies averaging

72% of premium costs


2014 ACA Coverage Medicaid-Marketplace Take Up

17%

ACA Marketplace Round 1: Oct 2013-Apr 2014 % Eligible Pop. Selecting a Marketplace Plan

U.S. 28% ‘Participation Rate’

Accessed 02/23/15 at: http://kff.org/health-reform/state-indicator/marketplace-enrollment-as-a-share-of-the-potential-marketplace-population-2014

43%

19% 21%

24% 20% 21%

27%

39%

29%


In the 10 states with highest % uninsured pre-ACA and having half the nation’s uninsured

28%

ACA Marketplace Round 2: Nov 2014-Feb 2015 % Eligible Pop. Selecting a Marketplace Plan

U.S. 41% ‘Participation Rate’

Accessed 02/23/15 at: http://kff.org/health-reform/state-indicator/marketplace-enrollment-as-a-share-of-the-potential-marketplace-population-2015/

44%

33% 33%

39% 35% 37%

48%

64%

49%


What’s going on in Florida?

71%

Medicaid Enrollment: Through 2014 % Eligible Pop. Enrolling in Medicaid

U.S. 59% Medicaid ‘Take Up Rate’

Analysis by Dan Derksen MD, Arizona Center for Rural Health

89%

60% 91%

26% 19% 94%

81%

63%

67%


No Medicaid Expansion – R-Gov childless adults not eligible: gap 0 to 100%FPL

Medicaid Expansion R-Gov

State Marketplace

R-Gov

ACA in 2014


STATE Round 2

Marketplace Sel/Renewed Plan

Nov 2014-Feb 2015

Round 2 Marketplace %Eligible

Sel/Renewed

Net Gain Medicaid Pre-ACA to 2014

%Eligible for Medicaid that

Enrolled

CA 1,418,000 44% 2,762,314 89% AZ 204,187 33% 294,896 60% NM 51,857 33% 183,975 91% TX 1,189,316 39% 223,019 26%

US Total 11,636,073 41% 10,751,820 78%

Pre-ACA: AZ, NM Health Coverage Payer Source # AZ #NM Medicaid 1,200,000 550,000 Uninsured 1,200,000 450,000 Medicare 800,000 300,000 Private Insurance 3,300,000 900,000 Total Pop. AZ 6,500,000 2,200,000

www.statehealthfacts.org http://quickfacts.census.gov http://www.azgovernor.gov/hix/documents/Grants/UpdatedBackgroundResearchReport.pdf

Medicaid + Uninsured Comprised 40-45% AZ, NM Pop.


“Weigh the evidence and do the math”

$2 billion per year 20,000 jobs

250,000 uninsured covered

Governor Brewer – Medicaid Expansion

http://www.huffingtonpost.com/2013/01/14/arizona-medicaid-expansion_n_2474726.html 10/26/14 Dan Derksen MD 03/16/15 Dan Derksen MD

Governor Brewer restored Medicaid eligibility to 100% FPL for childless adults in 2014 (Prop. 204 passed in 2001), & expanded

it from 100% to 138% FPL as ACA allows

Do the math!

5% Medicaid Provider Cut •  ‘Saves’ state $127 million/2 yrs •  Costs 0.5 billion fed match •  Eliminates est. 5,000 jobs •  Levies hidden tax to Arizona

hospitals & docs >$0.6 Billion!

Governor Ducey – Medicaid Cuts

10/26/14 Dan Derksen MD 03/16/15 Dan Derksen MD

Health Insurance Coverage Disparities Persist in U.S.


Pre-ACA Uninsured

%Uninsured thru Feb

2015

#Uninsured Gaining

Coverage (Millions)

Whites 14.3% 9.0% 6.6 African

Americans 22.4% 13.2% 2.3

Latinos 41.8% 29.5% 4.2

Total US 20.3% 13.2% 16.4

Outreach Programs Needed to Assist Populations with Low Participation Rates

http://aspe.hhs.gov/health/reports/2015/uninsured_change/ib_uninsured_change.cfm

Marketplace +11.7 Million

Income < 138% Income 138% to 400%

AHCCCS – AZ Medicaid <138% FPL ($32,499 Family of 4)

Jan 2014-Feb 2015 Net Gain

+323,744

AZ MARKETPLACE 138-400% FPL ($32,499-$94,200) Round 2 Enrollment thru 2/15/15

+205,166

Age <26 Parents’ Plan +2.3 Million

AZ <26 Parents’ Plan +70,000

2015 ACA Medicaid Gain + Round 2 Marketplace Enrollment for U.S. / AZ Jan 2014-Feb 2015

Arizona ACA Total: +600,000

UNITED STATES

ARIZONA ACA ENROLLMENT

Medicaid +10.8 Million

http://aspe.hhs.gov/health/reports/2015/MarketPlaceEnrollment/Mar2015/ib_2015mar_enrollment.pdf http://kff.org/health-reform/state-indicator/marketplace-enrollment-as-a-share-of-the-potential-marketplace-population-2015/ http://www.medicaid.gov/medicaid-chip-program-information/program-information/downloads/december-2014-enrollment-report.pdf



Round Two ACA Marketplace Enrollment 11/15/14 - 2/15/15 Percent

Uninsured Pre-ACA

2012

Number Uninsured Pre-ACA

2012

Round One Oct 2013-Apr 2014 # Selected Plan in 6.5 Months

Round Two Nov 2014-Feb 2015

Sel/Renewed Plan in 3 Months

AZ 18.5 1,201,000 120,071 205,666 NM 20.6 416,000 32,062 52,358 TX 24.6 6,192,000 733,757 1,205,174 US 15.7 49,183,000 8 million 11.7 million


Compiled by: DJ Derksen: Data Accessed at: healthcare.gov 11/10/14 Dan Derksen MD

Pima County, Arizona Marketplace Insurers and Plans Second Enrollment Period: 11/15/14 to 2/15/15


ACA in 2014 to 2015 • 2nd Marketplace enrollment 11/15/14 – 2/15/15 • Marketplace Tasks – renew, enroll uninsured, in 3 months (1st enrollment was 6.5 months)

•  é 25% Insurers offering plans •  ê $5.7B hospital uncompensated care 2014 • 75% of that êis in Medicaid expansion states • Special Enrollment: 3/15/15 to 4/30/15

Accessed 2/23/15: https://www.healthcare.gov/coverage-outside-open-enrollment/special-enrollment-period/ Accessed 1/11/15 at: http://aspe.hhs.gov/health/reports/2014/NewEntrants/ib_NewEntrants.pdf


Avg. Annual Percent Increase in National Health Expenditures 1960-2012

10.6%

13.1%

11.0%

6.7%

5.8%

6.4%

7.1% 8.4%

9.7%

8.6%

7.2% 6.8%

6.5% 6.3%

4.7% 3.8% 3.8% 3.6% 3.7%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

1960 1970 1980 1990 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

Proj. 2013 3.6%

SOURCE: Kaiser Family Foundation calculations using NHE data from Centers for Medicare and Medicaid Services, Office of the Actuary, National Health Statistics Group, at http://www.cms.hhs.gov/NationalHealthExpendData/ (see Historical; National Health Expenditures by type of service and source of funds, CY 1960-2012; file nhe2012.zip). NHE Projections 2013-23. Health Affairs Sept 2014. At healthaffairs.org

Last 5 years: Lowest spending growth in 50 year history



AZ Marketplace 2014 to 2015 •  AZ: 10% Decrease monthly Silver premiums

(ex. 40 y.o. making $30,000 /yr) •  AZ: 2nd Lowest Silver premiums in U.S. •  AZ: 5th Lowest Bronze premiums in U.S. •  Choice: Min.7 Insurers 60 plans in all counties •  628,000 uninsured Arizonans were eligible for

Arizona Marketplace coverage in 2015 •  204,187 (33%) renewed or selected plan 2015


Did you know? Arizona’s land area of

113,594 sq. miles would encompass the state of New York, the

six New England States (CT, ME, MA, NH, RI, VT)

and DC + Delaware


CHALLENGE: Distributing the

health workforce to the areas of high need


Access to Care


•  75% Pop. Lives-Phoenix, Tucson •  86% Physicians-Phoenix, Tucson

HPSA = federally designated health professions shortage area

Teaching Health Centers Teaching Health Centers – move the primary care training

pipeline to areas of need. Grads have higher rates of practicing in rural and medically underserved areas.

Accessed 5/17/14 at: http://bhpr.hrsa.gov/grants/teachinghealthcenters/index.html

States: AL, AK, AZ, CA, CT, ID, IL, IA, KY, ME,

MA, MI, MO, MT, NM, NY, NC, OK, PA, TX, WA, WV

State Pacesetters

10/26/14 Dan Derksen MD 03/16/15 Dan Derksen MD

What it Means for States and Public Health King vs Burwell...Act II: Justice Anthony Kennedy Justice...

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