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Keep Puerto Rico in Your Thoughts This Thanksgiving Holiday, and the Mandate Repeal in Your Sights

Keep Puerto Rico In Your Thoughts This Thanksgiving Holiday, And The Mandate Repeal In Your Sights

As you sit down with family and friends this Thanksgiving and as we get into the Christmas Holiday season, keep in mind our American friends in Puerto Rico. Just after the devastation of hurricanes Irma and Maria, we wrote an extensive blog on the island’s precarious state. Sadly, much of what we wrote remains true today. Most people still lack power. Some are still without potable water and telecommunications. The health crisis has deepened. While few want to deal with the fact, a few publications have begun talking about the “hidden and untold” hurricane deaths on the island. While the official death count was about 50, the truth is hundreds of people died after the hurricanes. Because the island remains devastated, hundreds more likely will die because island residents continue to lack access to critical health services.

We do not want to cast blame anywhere, except to say that Puerto Rico remains in dire need of public and private donations and relief. As a United States territory, it deserves as much attention and funding as any state in the nation. Not only is Puerto Rico desperate for support to recover from the hurricane devastation, the impending insolvency of the Medicaid program there demands immediate attention, too. In our earlier blog, we explained how the Medicaid funding system is rigged against Puerto Rico: a cap on its federal cost-sharing percentage pegs Puerto Rico’s funding well below its poverty statistics. Making matter worse, this paltry funding is reduced further by an arbitrary congressional cap. Congress doles out bailout funds periodically to look good. It is no way to ensure consistent access and coverage on the island.

Hundreds of thousands – perhaps as many as 900,000 Puerto Ricans – could lose coverage without a solution quickly. Puerto Rico’s Governor, Ricardo Rosello, has asked the President and Congress for $1.6 billion each year for five years to cover those in need and ensure providers and private health plans stay in the program. The House has proposed $1 billion more in one-time funding. This again would kick the can down the road.

Given the health crisis in Puerto Rico, Governor Rosello’s request should be funded immediately in a bipartisan effort. The time will come when discussions can be had about reforming the healthcare system there. For now, Puerto Rico is in the midst of a deepening healthcare crisis and the focus should be all about saving lives.

Obamacare Coverage Mandate Repeal May End Up in Tax Reform Bill

Given the Thanksgiving holiday, healthcare news has been a little slow. One major development over the last week or so is that repeal of the Obamacare health coverage individual mandate could be included in the tax reform bill racing through Congress.

In their opposition, Democrats cite predictions by the Congressional Budget Office that 13 million or more people over the next decade will lose coverage if the mandate is repealed. Republicans cite private researchers’ estimates that are much lower. For example, a new report from financial and ratings firm Standard & Poors sees a loss of coverage at just 3 to 5 million. The difference ties to what you believe drives coverage: the tax penalty or the attractiveness of government subsidies.

The repeal provision will be dropped from the bill if enough moderate Republican Senators oppose its inclusion. Republicans want the provision in the bill because the repeal actually “saves” them money in the budget from reduced subsidy spending even with the loss of penalty dollars. It gives them more tax-cutting room. But Republicans will not go without a tax victory if moderates hold out on the mandate repeal. The outcome is unknown right now. Many moderates are concerned by the mandate repeal as it could further destabilize the Exchanges. But one swing Senator, Lisa Murkowski, R-Alaska, expressed sympathy for the repeal provision, noting that she is not in favor of forcing people to buy coverage if they don’t want to.

Admittedly, we at this blog have been relatively weak on the mandate. We are just not sure how important it will really be over the long term. Philosophically, we are sympathetic to the idea that Americans should be able to decide whether they get coverage or not. At the same time, there is no doubt that the repeal would impact the number of Americans covered, the number of health plans in the program, and the size of premiums – principally, because we think adverse selection in the program would only increase. How much is hard to say. We don’t believe it is as much as CBO estimates as we think the subsidies, not the tax penalty, drive more enrollment.

Instead, we favor a permanent bipartisan solution (with a short-term stabilization, as well) to the quandary, where Exchange benefits and subsidies are protected but become more rational; where the Medicaid expansion is protected (because it is relatively cost effective and it works!); where states have some ability to experiment and waive rules given unique market conditions; and – perhaps as a compromise, where the mandates on both employers and individuals remain to ensure shared responsibility becomes a priority and prevention and quality are at the forefront of our healthcare system. But there should be a thoughtfully considered, holistic solution. CMS recently unveiled a proposed rule that would allow states to define essential health benefits coverage in a broader way, such as choosing skimpier benefits in the market now. Conceptually, this is not a bad idea but should be part of the broader plan we would like to see.

Marc Ryan

Marc S. Ryan serves as MedHOK’s Chief Strategy and Compliance Officer. During his career, Marc has served a number of health plans in executive-level regulatory, compliance, business development, and operations roles. He has launched and operated plans with Medicare, Medicaid, Commercial and Exchange lines of business. Marc was the Secretary of Policy and Management and State Budget Director of Connecticut, where he oversaw all aspects of state budgeting and management. In this role, Marc created the state’s Medicaid and SCHIP managed care programs and oversaw its state employee and retiree health plans. He also created the state’s long-term care continuum program. Marc was nominated by then HHS Secretary Tommy Thompson to serve on a panel of state program experts to advise CMS on aspects of Medicare Part D implementation. He also was nominated by Florida’s Medicaid Secretary to serve on the state’s Medicaid Reform advisory panel.

Marc graduated cum laude from the Edmund A. Walsh School of Foreign Service at Georgetown University with a Bachelor of Science in Foreign Service. He received a Master of Public Administration, specializing in local government management and managed healthcare, from the University of New Haven. He was inducted into Sigma Beta Delta, a national honor society for business, management, and administration.

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