Entries by Joshua Archambault

Responding to Cadillac Tax Report Concerns

Pioneer’s recent report on the Cadillac tax has garnered a good deal of media attention and some political push back. Political pushback comes in the form of objections that fail to engage on the issue of the Cadillac tax itself; rather they focus on two assumptions made in the Pioneer study: 1) Healthcare growth rates in the future will look similar to the recent past, and 2) Income growth rates in the future will look similar to the recent past. Of course, we have no more of a crystal ball than anyone else does, however… As is our practice, we made our assumptions very clear, right up front. And second, we based our assumptions on data. Pioneer is an empirical […]

Fall River Herald News: Beware ObamaCare’s “Cadillac Tax” That’s More Like a “Ford Tax”

President Barack Obama has consistently said that Massachusetts was the template for the Affordable Care Act, often referred to as ObamaCare. So the conventional wisdom has been that the new law won’t change much here. But a new Pioneer Institute study demonstrates just how wrong the conventional wisdom has been. Starting in 2018, the federal law includes an excise tax on your annual health insurance benefits that exceed $10,200 for an individual and $27,500 for a family plan. While stumping for the law, President Obama said the tax, which was reportedly Massachusetts Sen. John Kerry’s idea, was aimed at “super gold-plated Cadillac plans” or $40,000 Wall Street health insurance plans. The Obama administration has done its best to highlight some […]

MetroWest Daily News: State’s mixed record on health reforms

Massachusetts has chosen to incubate health care solutions rather than wait on the rest of the country. That impulse is correct, provided we take the task seriously. The past 90 days have given us two examples of big policy changes — one empirically based and understated; the other hasty and oversold. First the good news. For some time now, state healthcare officials have been working on a limited experiment to integrate care for those eligible for both Medicare and Medicaid. So called “dual-eligibles,” have for too long received uneven and uncoordinated care. Two different sets of rules often require duals to schedule multiple appointments as limits are set on billable procedures per visit. The state has a financial incentive to […]

Big ACA Middle-Class Tax Increase in Mass, $87K for Small Biz Employee

Pioneer is releasing a new brief estimating the impact of the so-called “Cadillac tax,” targeted at high cost insurance plans, contained in Obamacare. The report finds that given our high premiums, a majority of workers in Massachusetts will pay the tax in 2018. On a more micro level, the report examines the impact of the excise tax on a small business employee, a police officer, and a teacher. The future looks expensive! For the 10 years following the introduction of the tax: Business employee on a family plan will owe $86,905 in additional taxes. Police officer on a family plan will owe $53,907 in additional taxes. Teacher on an individual plan will owe $20,807 in additional taxes. Remember this is all on top of paying […]

Impact of the Federal Health Law’s “Cadillac Insurance Tax” in Massachusetts

The Obama administration has done its best to highlight some of the more popular provisions of the law such as expanded preventative benefits, allowing children up to age 26 to remain on their parents insurance, closing the prescription drug “doughnut hole” for seniors on Medicare, and expanded contraception coverage. Yet, many of the less attractive provisions have not been given a local spotlight. This brief will examine the impact of the so-called “Cadillac tax” included in ObamaCare.

Case Study-When Politics Influences Policy: Liberal Health Wonks from Mass

This afternoon FamiliesUSA released a report from a trifecta of liberal health policy wonks– Jon Gruber, Stuart Altman and John McDonough. I joined the press call to listen to the discussion. Just to say upfront, I know all of these authors and consider them friends or good acquaintances. However, as you will see below we don’t always see eye-to-eye. The goal of the new report was to compare RomneryCare vs ObamaCare vs RomneyCandidateCare. Not surprisingly, Obamacare comes out smelling like roses, and RomneyCandidateCare will push Americans into the deep uninsured abyss. Avik Roy over at Forbes.com rightfully takes issue with a number of assumptions being made in the modeling of Governor Romney’s plan for the nation. One in particular is […]

If Doctors Know the Price, Would It Change Behavior? Essay Contest

The great folks over at Costs of Care have opened their 2012 essay contest to collect stories (the good, the bad, and the ugly) from both patients and  medical professionals as they wrestle with healthcare costs.  The full details: Essay Question: Do you have a story about a medical bill that was higher than you expected it to be? Or a time when you wanted to know how much a medical test or treatment might cost? How about a time you figured out a way to save money while still receiving high-value care? Judges Pauline Chen, surgeon, New York Times columnist Jeffrey Drazen, editor-in-chief, New England Journal of Medicine Donna Shalala, former United States Secretary of Health and Human Services Ezekiel Emanuel, ethicist and […]

NYT: Medicare Bills Rise as Records Turn Electronic

The theory of cost savings don’t always match what happens in reality: When the federal government began providing billions of dollars in incentives to push hospitals and physicians to use electronic medical and billing records, the goal was not only to improve efficiency and patient safety, but also to reduce health care costs. But, in reality, the move to electronic health records may be contributing to billions of dollars in higher costs for Medicare, private insurers and patients by making it easier for hospitals and physicians to bill more for their services, whether or not they provide additional care. Hospitals received $1 billion more in Medicare reimbursements in 2010 than they did five years earlier… A future unintended consequence of […]

Does Health IT Guarantee Better Care & Save Money?

Given the near universal HIT mandate in Chapter 224 of the Acts of 2012 in Massachusetts, research on the effectiveness of the policy mechanisms in the bill should draw close interest. A WSJ op-ed this morning tackles the HIT question. SEPTEMBER 17, 2012 A MAJOR GLITCH FOR DIGITIZED HEALTH-CARE RECORDS Savings promised by the government and vendors of information technology are little more than hype. By Stephen Soumerai and Ross Koppel In two years, hundreds of thousands of American physicians and thousands of hospitals that fail to buy and install costly health-care information technologies—such as digital records for prescriptions and patient histories—will face penalties through reduced Medicare and Medicaid payments. At the same time, the government expects to pay out tens of billions of […]

$14B in Medicare Cuts under ACA for Massachusetts

During the Presidential race, we have heard a lot about the $716 billion that will be cut from Medicare under the ACA and the savings included in Congressman Ryan’s budget. (See my thoughts on the difference in the proposals at Boston.com) Locally, the important question is, how will the ACA cuts impact Massachusetts? An updated working paper, released this morning, from the University Of Minnesota puts some numbers to this question. So how much will future reductions be for Medicare Fee-For-Service and Medicare Advantage Payments in Massachusetts? Roughly $14 billion in reductions from 2013-2022. Just for review, the ACA cuts $716 billion in the following ways: The ACA reduces annual updates to Medicare’s payment rates for most provider services in the […]

Do Patient-Centered Medical Homes Save Money?

Locally, much has been made about the Massachusetts Patient-Centered Medical Home Initiative, with supporters claiming it will revolutionize medicine. It is too early to tell for sure, but will it save money? Picture: University of Pittsburgh Medical Center North Carolina started down this road before Massachusetts, and while early reports claimed historic savings, recent evaluations have called that conclusion into question. Al Lewis over at The Health Care Blog as some takeaway lessons. The ongoing saga of savings estimates for the Community Care of North Carolina (CCNC) patient-centered medical home (PCMH) is finally over.  The verdict: no savings. Because the scale and visibility of the CCNC experiment are unparalleled in the Medicaid sector today, it is important that the right policy and delivery system lessons be learned from this dispositive […]

New England Raking in $$$ for ACA Exchanges, $351 million and counting

Josh Archambault, Director of Healthcare Policy at Pioneer Institute in Boston Many supporters of the ACA contend that the Massachusetts health care law is the exact same as the federal version. (Some have even used colorful language to make this point.) A proxy for how big the changes will be is the level of funding coming from the Federal government to bring the Massachusetts Connector into compliance with the ACA. Answer: $48,236,271 and counting. Or is that $57,131,300, with an award supplement to “accelerate changes in its current Exchange IT infrastructure.” MA HHS grants so far. To be fair $36 million of this money is for a New England regional exchange for Connecticut, Maine, Massachusetts, Rhode Island, and Vermont. However […]

Change Coming for FSAs? Drop the “Use-it-or-Lose-It” Rule

HT to Meghan McCarthy at National Journal for the report and John Goodman for highlighting it on his blog, but there could be big changes ahead for flexible spending accounts. FSAs are a tool along with health savings accounts (HSAs) and health reimbursement accounts (HRAs) that can help to engage consumers to be value-seekers in healthcare. A little-noticed bulletin from the Treasury Department could have a big impact on the roughly 155 million Americans who use flexible spending accounts to cover out-of-pocket health care expenses. The government’s notice, sent out in May, included a surprise in what otherwise might have been a dry announcement on the implementation of President Obama’s health care reform law. In addition to detailing a new spending cap, […]

Rent Seeking in Mass Price Capping Law

After Moody’s issued a credit negative analysis for hospitals in the Commonwealth under the new health care law signed this week, I started to wonder how hospitals will react to the incentives in this new proposal. One line from the Moody’s report is of particular interest: Another negative credit effect of the bill is that the state will use an excise tax on insurers to support smaller and less profitable hospitals, potentially allowing them to remain in business longer than would otherwise be possible… I contacted the author from Moody’s (Dan Steingart) to ask if they had additional information on the $135 million Distress Hospital Fund and the hospitals that would receive this money. Part of his response is below. The bill is vague […]

Medicaid Patient Access in Mass

Yesterday the Massachusetts Medical Society released its annual MMS Patient Access to Care Studies. While the media coverage has focused on the lack of change in wait times across the Commonwealth from last year and the regional issues that remain in the state, there is one subgroup that deserves special mention– those on Medicaid. Massachusetts has roughly 1.3 million people on MassHealth (Medicaid), and they are having problems seeing a doctor. Only 62% of family doctors are taking new MassHealth patients and only 53% of Internal Medicine doctors. We are putting more folks on this program under the ACA, and the regional issues are quite pronounced. Pages 23 and 19 in the report show this. Only 14% of Barnstable family […]

Moody’s Report: New Mass Price Capping Law “Credit Negative” for Hospitals

In the soon to be long list of unintended consequences as a result of the brand new price capping law signed yesterday by Governor Patrick, Moody’s released a report warning of the future impact of the law on hospitals in the Commonwealth. While not a formal downgrade, it could raise the cost of capital borrowing for these hospitals and increase the cost of providing health care going forward. These extra costs will be passed onto consumers in the form of higher care costs and insurance premiums. More from SHNS($): The health care cost control law signed by Gov. Deval Patrick Monday will hurt the bottom lines of Massachusetts hospitals and limit their flexibility to grow, a major credit rating agency warned Monday. “The […]

Funny Business Ahead in Massachusetts?

Over at the Manhattan Institute, Paul Howard recently blogged on Massachusetts’ move towards a price cap on health care growth.  The whole piece is worth reading, but he makes one great point that has not be explored enough in Massachusetts: Bay State legislators are betting that you can reform 20% of the economy from the supply side, with very little involvement from the demand side (the patients). (For more detail, see this post.) It also assumes that commissions and technocrats recruited from industry, hospitals, and academia won’t play favorites, or be pressured by interest groups into supporting pet projects and institutions. Good luck with that. Find me on twitter: @josharchambault

Will Government-Directed Healthcare in Mass. Really Contain Costs?

Governor Patrick signed a new healthcare law today aimed at cost containment, and the rhetoric soared assuring all that Massachusetts has “cracked the code on healthcare costs.” Unfortunately, with no debate on the underlying bill in the House of Representatives and only little debate in the State Senate, the 349-page statute, which was released just 14 hours before the legislative final vote, is little understood and brimming with unintended consequences. To mark the occasion, Pioneer released the follow infographic: Real cost-containment is only possible when we encourage patients to reward low-cost, high-quality providers with their business.  We’ve said it over and over again throughout this process. Instead, the law being signed today re-imagines and repackages so many failed top-down approaches […]

Pioneer’s Statement on “Cost Containment” and Payment Reform Bill

Another Lost Opportunity to Give Individuals and Businesses Relief on Health Care Costs Final Version of Conference Committee Bill Adds Hundreds of Millions to System BOSTON – After years of debate over how to contain health care costs, the Massachusetts Legislature is poised to approve a bill that burdens the entire health care system with more bureaucracy and hundreds of millions in increased expenses. “Real cost-containment is only possible when we encourage patients to reward low-cost, high-quality providers with their business,” says Josh Archambault, Pioneer’s director of health care policy. “Instead of providing financial incentives for individual patients to take charge of their own medical care, this legislation rearranges the system based on accountable care organizations (ACOs) and changes in […]

ACA Impact on Mass, Part 1: Low-income Residents will Pay More for Healthcare and Insurance

Affordability/ Subsidy levels for Low-income: How much will individuals pay for health insurance and health care under the federal law? Under the ACA, low-income individuals will pay more. Urban report I don’t recall supporters of the federal law in the Commonwealth highlighting this difference before it passed Congress or leading up to the SCOTUS ruling. Drilling down to look at cost-sharing as well along with the range of premium payment ranges: Mass vs Fed Diff in costs State Law – CommCare Federal Law – QHP Premium Cost-sharing Premium Cost-sharing 138-150% FPL $0 $29 $36-$54 $24 150-200% FPL $40 $29 $55-$114 $54 200-250% FPL $78 $43 $115-$183 $115 250-300% FPL $118 $43 $184-$259 $128 Source: Connector The State may have two […]

How SCOTUS ACA/Obamacare Ruling Impacts Mass

Most of the press coverage has focused on the political angle of the SCOTUS ruling, but the more interesting and complex questions lay at the policy level. Pioneer recently released a book to propose a new relationship between states and the federal government, and it has received considerable national attention. Even if Democrats or Republicans don’t talk about the law this way, the new healthcare law is a new entitlement program and will likely be reformed in some manner to address the federal deficit. [Learn more, and download a couple free chapters or buy a copy at Greatexperiment.org] But for now, and since the ACA was upheld, the policy questions refocus on individual state implementation. Locally, conventional wisdom would tell […]

Pulling Back the Curtain on Beacon Hill’s “Healthcare Reform 2.0”

T-minus 13 days until the end of the legislative session and one of the largest and most controversial pieces of legislation has moved with almost no media attention. The promises for the new cost containment/ payment reform bills (or health reform 2.0, as some are calling it) — now being considered by a joint House-Senate conference committee — are historic, according to the rhetoric of the elected officials who authored it. It “completely alters the landscape of our delivery system,” and “will result in an estimated $150 billion in savings over the next 15 years.” “It is going to work because it is well thought out?… It is not going to hurt our best hospitals… We will be the first […]

Jon Gruber’s RomneyCare/ObamaCare False Narrative

This morning, Steve LeBlanc of the Associated Press has another Massachusetts focused story up titled “Mass. Health Law May Bode Well for Federal Law.” The piece is based on a common flawed assumption. The piece fails to mention Massachusetts’ pre-reform circumstances in contrast to other states now. It expects that the same actions and behaviors will play out in the same way in other states. To expand on my quote in the story, can we honestly suppose New Mexico with 20+% uninsured, no guarantee issue in their individual market, employer sponsored insurance rates of 48.6 percent, lower income levels, lower education level, low-medical infrastructure, and a geographically spread out state to see the exact same results as the Commonwealth? Contrast that with the  starting place […]

Are Fewer People in MA Paying the Indiv Mandate Penalty?

Since the Supreme Court upheld the ACA/Obamacare, there has been a renewed interest in the Massachusetts healthcare law. I have blogged many times before to caution readers and the media not to assume the two laws will lead to the same results, because they won’t, mostly as Massachusetts is not the same patient with the same ailments as New Mexico, or Michigan, or even Florida. I know I am fighting against the conventional wisdom,  but this issue warrants discussion as Congress passed a national program and modeled the behavior and cost estimates (incorrectly in my opinion) partially on our experience here in the Bay State. As a result of the national interest, I assume we will see more local reports […]

Pioneer Press Release on SCOTUS ACA Ruling

The Way Forward: Despite Supreme Court Ruling, New Start Needed on Health Care Reform Pioneer Institute calls for Congress to replace most of the federal health law and clear the way for state-based reforms BOSTON – Despite the US Supreme Court’s decision to uphold the Patient Protection and Affordable Care Act (PPACA), Pioneer Institute for Public Policy Research calls for a new approach to solving the nation’s health care problems. “The fact that this decision was made in essence by a single justice highlights the need for real solutions that can gain broad consensus across the country. The Court’s decision today will set off further state and federal conflicts that will likely end up in the courts once again,” says […]

The Myth of Cost Control Legislation

The House passed their version of “cost control” last night in a 148-7 vote. Sadly for taxpayers and the general public, there was little debate on the bill itself and the few minutes of debate on the floor revolved exclusively around a handful of amendments. Changing 18% of our state economy with little debate, no hard questions, in a few hours, no problem? Was this how we did it for health reform 1.0? The leadership accepted most special interest amendments in an effort to garner votes. Most of these provisions will be taken out in conference committee. What We Know 18% of the Massachusetts economy is health care related; 20% of patients account for 80% of costs, 5% of patients […]

Guide to Mass Payment Reform Amendments: Sex Ed, Podiatry, and Acupuncture

Find me on twitter: @josharchambault For those following at home, the House will debate their version of payment reform today and tomorrow. You can watch here starting at 1 pm and read the redraft of the bill here. 275 amendments have been filed, and legislators appear to be more focused on social policy, labor policy, and special-interest carve outs than health delivery and payment reform. Some of the more colorful amendments consist of: Social Policy: Studying sex ed in charter schools.(#30) 4 amendments dealing with family planning (#32, 139, 264, 265), removing ultrasound diagnostic imaging from the definition of an advanced diagnostic imaging service (#179), and health care equity (#217). Labor Appointments: There are 5 amendments giving appointments to the Massachusetts Nurses Association […]

Mass House Pulls a “Charlie Brown” on Payment Reform Redraft

The Massachusetts House rushed the release of their payment reform bill to beat the Senate the first time around. As a result, the next few weeks provided time for House lawmakers to receive feedback and improve the bill before it was to be voted on. Unfortunately, the bill’s authors missed the ball again, and made only small changes. Unfortunately, the House has decided to follow the Senate precedent of rushing passage of the final bill. 48 hours to file amendments, and only a couple more days before it is debated and voted on next week. [Changing 18 percent of our economy in two days, with many unanswered questions about added costs, lack of evidence of savings, and lots of new mandates, […]

Video: But Will The Cost-Cutting Bills Really Save Money?

The debate on Beacon Hill is heating up on payment reform legislation, but the public discourse has revolved primarily around dueling press releases.  There has been little discussion exploring the real challenges of fundamentally changing 18 percent of the Massachusetts economy with new payment and delivery methodologies. With 20 percent of patients accounting for 80 percent of health care costs, is this the right approach? Will it save money and engage consumers? CommonWealth magazine hosted a recent web discussion to cover a few of these topics. WBUR’s CommonHealth blog recently shared the video as well.