No, the new Texas insurance law does not require homeowners to file storm-related damage claims before September 1st

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It started with an email, forwarded from a friend in Austin, containing the following:

EFFECTIVE FRIDAY, the laws governing insurance claims in Texas will change to your detriment. To take advantage of current law, which is more favorable to you the consumer, YOU MUST FILE YOUR CLAIM, IN WRITING, BY THURSDAY, AUGUST 31, regardless of whether your damage occurred before that date. That is, it does not matter if your DAMAGE occurred before the effective date. To take advantage of current law you must actually file a claim by Thursday. It must be (1) IN WRITING, and (2) SPECIFIC ABOUT WHAT DAMAGE YOU ARE CLAIMING OCCURRED.

Pretty soon we were seeing similar tweets and Facebook posts urging people whose homes were damaged by Hurricane Harvey to file insurance claims before September 1st when a new Texas law, HB 1774, goes into effect. The law does make it more difficult for homeowners to sue their insurance companies over weather-related damage claims, but it does not change the actual claims process.

As misinformation about the law spread we began to see panicky tweets about the impending deadline for filing claims, some implying that claims filed after September 1st might not be paid in a timely manner (or at all!).

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Yesterday we were contacted by a reporter at Snopes.com who was fact checking this story. Here is what he wrote:

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In the past 24 hours numerous other media outlets have also covered the new law. While most reported accurately, some of the headlines probably didn’t help the situation. For example, this headline from The Daily Beast:

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The story itself is a reprint of a Texas Tribune article, which has a much less sensational headline.

Other good coverage appeared in the The Wall Street Journal :

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and on Vox.com which provided a useful “explainer” about the law.

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Our hometown paper, the Austin American Statesman did a fair job as well.

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UPDATE: The New York Times has now picked up the story too, and adds the following:

But the law does not affect most people in Texas whose property has been flooded. Only about 15 percent of homes in Harris County, which includes Houston, have flood insurance, according to an Insurance Information Institute survey.

Of the small number who have flood insurance, the vast majority bought it from the federal government’s National Flood Insurance Program, which is exempt from state laws. Neither the existing Texas penalty nor the new one applies to the federal program.

The law also exempts the Texas Windstorm Insurance Association, the state-run insurer of last resort for wind damage in coastal areas. So most homeowners in the flood zone can safely ignore the warnings, said State Senator Kelly Hancock, who sponsored an amendment to the law that lowers the penalty.

 

Medicaid Cuts Won’t Just Hurt the Poor

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The Medicaid cuts in the Senate Republican’s “new and improved” Better Care Reconciliation Act (BCRA) are not just cruel and unpopular, but they also threaten to undermine a thriving private insurance market, which is something Republicans claim to support.

In all the recent outrage over the Senate bill, no one mentioned a central fact about Medicaid: More than half of all Medicaid recipients receive their coverage through private insurance companies, who contract with state Medicaid agencies for a set fee per beneficiary. This means that the insurance companies both take on the risk and reap the rewards. And Medicaid expansion has been profitable for insurance companies. (Our ongoing research supports this finding, but we can’t provide details here while we pursue academic publication).

KFF Medicaid Map

The Medicaid/CHIP program provides health insurance for 20% of the U.S. population. In some states, more than a quarter of residents are covered by the program. In 2016 health insurers filing with the National Association of Insurance Commissioners (NAIC) reported nearly 40 million Medicaid members, representing 54% of Medicaid beneficiaries (In 2016 monthly Medicaid enrollment averaged 73.8 million).  Private insurer participation in the Medicaid market has grown significantly since the early 2000s (along with overall Medicaid enrollment). In 2001, only around a quarter of Medicaid members were covered by private health insurers.

The current Senate bill proposes not just to roll back ACA Medicaid expansion, but also to impose per capita caps on the funds states could receive. A longer term projection of the effects of the BCRA by the Congressional Budget Office (CBO) estimates Medicaid funding cuts of 35% by 2036.

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Source: Washington Post

Are Medicaid insurers making money by providing low-quality care or denying services? Medicaid opponents would have us believe the system is broken, that few doctors will accept Medicaid patients and those who do, provide inferior healthcare.

One particularly notorious claim, that Medicaid is actually worse than no insurance, is based on data from a single study. Critics have similarly latched on to the few other reports that seem to support their viewpoint, conveniently ignoring the dozens of academic papers that show positive effects of Medicaid expansion.

Recent pieces in The New York Times and the Los Angeles Times do a good job of explaining what the “negative” studies actually say and how they’ve been misrepresented. Yet the naysayers persist. See for example this article published last week.

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A new survey of Medicaid recipients further dilutes the negative depiction of Medicaid, with the majority of respondents indicating high levels of satisfaction with their healthcare. The National Medicaid Consumer Assessment of Healthcare Providers and System (CAHPS) survey included over 270,000 adults enrolled in Medicaid in the fall of 2013. The survey sample represented 46 states and included four categories of Medicaid recipients: 1) people with disabilities, 2) dual Medicare-Medicaid enrollees (the elderly), 3) non-disabled adults in managed care, and 4)non-disabled adults in fee-for-service medical care.

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The managed care members (those covered by private insurers) reported satisfaction levels comparable with the total sample results. Non-disabled adults enrolled in managed care were slightly more likely to report they were able to access care and had a primary healthcare source than those in fee-for-service Medicaid.

In his defense of the Senate healthcare bill, vocal Medicaid opponent Avik Roy praised the plan for replacing Medicaid expansion “with tax credits so that low-income Americans can buy the coverage of their choice at an affordable price.” At the heart of Roy’s argument is a belief that private insurers (the market) can do a better job than government bureaucrats.

But when it comes to Medicaid, private insurers are already doing that job – not just administering funds, but taking on the risk and managing the care of millions of Medicaid recipients. They are profitable and their customers are satisfied. So why are Republicans intent on undermining the one part of the Affordable Care Act that is working for both insurers and insured?

Why is subsidizing coverage on the individual market so much more acceptable than paying for similar (or even better) coverage through Medicaid? Is a bronze-level marketplace plan with a high deductible and co-pays and limited provider networks really better than a Medicaid plan with similarly narrow networks but no out-of-pocket costs?

Proponents of single payer healthcare would like to have insurance companies removed from the U.S. healthcare system entirely. Realistically, however, any universal healthcare plan we are likely to see in the near future will involve insurance companies. Health insurers have the necessary infrastructure and the expertise to manage the unwieldy beast that is the U.S. healthcare system. And good luck getting universal healthcare through Congress (even a Democratic Congress) without insurance industry by-in. In Medicaid we already have a model for a successful public-private partnership.

Trumpcare Takeaway: Stakeholders Matter

The main lesson we should take away from the failure of “Trumpcare” (or “Ryancare”) is the importance of stakeholders. When groups representing every type of stakeholder (medical professionals, hospitals, patients, and insurers) all came out against the American Health Care Act, its fate was pretty much sealed.

By now I think everyone can agree that the American Health Care Act (AHCA) was never intended as serious legislation. The utter failure of GOP lawmakers to consult with stakeholders, not just in the past two months, but at any point during the last seven years, made it clear from the beginning that they were not really interested in replacing the Affordable Care Act (ACA) with a real healthcare plan, so much as a political “win.”

In contrast, before voting on the ACA, Democrats spent nearly a year holding hearings, listening to experts, and getting buy-in from stakeholders (doctors, patients, hospitals, insurers).

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The Republican leadership’s bypassing of the legislative process not only shows disregard for the people they purport to represent, but it also reveals just how little many members of Congress know (or care) about basic economics, much less healthcare economics. After listening to hours of “debate” over the past few weeks, I’ve come to the conclusion that most Republican House members (and probably some Democrats) don’t have the first clue how our health insurance system actually works, much less how changing it might effect their constituents.

Contrary to Republican nostalgia, I don’t think most Americans want to move backwards. The ACA protections (no exclusion for pre-existing conditions, essential health services, no lifetime caps, yearly out-of-pocket maximums) are the new standard. No amount of extolling the “free market” and “freedom to chose” will convince people they are better off without these ACA protections. In fact, the more protections Republican leadership gave away, to try and win over the Freedom Caucus, the more they spooked moderates in their party who feared the political repercussions of taking healthcare away from their constituents. And rightly so. By Thursday only 17% of the public supported the AHCA. By cancelling the vote numerous Republican members of the House were saved from voting against the interest of their own constituents.

Over the past few weeks Republicans couched their opposition to the ACA in terms of “freedom.” What they failed to recognize is that yes, Americans want freedom—the freedom to not worry about how they’re going to pay for healthcare.

Infographics Part II: ACA Medicaid Expansion vs. AHCA Per Capita Caps

NYT CBO

Medicaid beneficiaries stand to lose the most under the American Health Care Act (AHCA). According to the new Congressional Budget Office Report, Medicaid recipients would make up a disproportionately large share of 24 million people expected to lose health insurance coverage by 2026 if the GOP legislation becomes law.

Under the Affordable Care Act (ACA) 32 states expanded Medicaid eligibility to low-income adults earning up to 138 percent of the poverty line (about $34,000 for a family of four). The AHCA, as currently written, continues expansion for three more years before cutting federal funding to state Medicare programs through a per capita cap, limiting coverage to those enrolled before 2020. Vox recently provided a good explanation of per capita caps as does the Kaiser Family Foundation.


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Many of the best Medicaid infographics predate the release of the AHCA, but they still remain relevant to the current discussion. The KFF website includes a large collection of data on Medicaid expansion, including maps (like the image above) and detailed Medicaid State Fact Sheets.


The Center on Budget and Policy Priorities (CBPP) produced the following charts estimating the costs to states of the per capita cap.

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MEdiciad Cuts Growth OVer Time CBPPCBPP also created a series of fact sheets illustrating the effects of Medicaid cuts in nine different states. Here is the fact sheet for Pennsylvania:

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Images in the slideshow below appear in The New York Times article “Republicans’ Changes to Medicaid Could Have Larger Impact Than Their Changes to Obamacare”

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See Part I: Tax Credits vs. Premium Subsidies

Coming Soon:

Part III: Individual Mandate vs. Penalty for Break in Coverage

Part IV: Cost Comparisons

The Best Infographics Comparing the GOP’s Healthcare Plan with the Affordable Care Act

Part I: Tax Credits vs. Premium Subsidies

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In the week since the Republicans unveiled their Obamacare replacement plan multiple news outlets have  reported on what’s in the legislation, how it compares to the Affordable Care Act (ACA), who stands to benefit or lose, how much it will cost, etc.–many illustrated with helpful infographics.

Even if you follow the healthcare debate closely, the quantity of tables, graphs, and charts can quickly get overwhelming. After a while they all seem to look the same (actually, many are the same, or rely on the same data sources).

Want to know what’s in the American Health Care Act (AHCA) and how it might affect you and your community? We’ve compiled some of the best infographics from around the internet to help you make sense of it all.

Part I: Tax Credits vs. Premium Subsidies

One of the most significant changes in the GOP legislation is the replacement of premium subsidies (based on age, income, and geography) with age-and income-based tax credits, with no geographic variation. Several graphs from the Henry J. Kaiser Family Foundation (KFF) show how people of different ages and incomes fare under tax credits depending on where they live.(If you aren’t already familiar with the Henry J. Kaiser Family Foundation you should check out their website now.)

Their Interactive map provides county-and-state level comparisons of of ACA vs. AHCA tax credits  based on age and income level.

Note: To try it out, click on the picture below to go to the KKF site. Once the new page opens, scroll down a bit to find the interactive map.

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A related KFF report, How Affordable Care Act Repeal and Replace Plans Might Shift Health Insurance Tax Credits, includes the following charts, illustrating the effects of the GOP plan’s tax credits on individuals and families in different age and income groups in high and low cost states.

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Many prominent news outlets cite KFF as a source for their illustrations. For example, last week,  both The Los Angeles Times and The New York Times used similar graphics (in different colors) based on KFF data.

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Another good set of illustrations of how the GOP plan might affect individuals at different income levels is provided in an analysis by The Century Foundation.


For a state-by-state comparison, the waterfall graph (below) from The Center on Budget and Policy Priorities (CBPP) shows the difference between the average ACA subsidy and the proposed AHCA tax credit.

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Part II: Medicaid Expansion vs. Per Capita Cap

Coming Soon:

Part III: Individual Mandate vs. Penalty for Break in Coverage

Part IV: Cost Comparisons

 

Selling Health Insurance Across State Lines

Did President Trump just call for federal regulation of the health insurance industry?

In his first address to Congress, President Trump enumerated his healthcare reform priorities. These include protecting coverage for those with pre-existing conditions, tax credits, health savings accounts, giving states more flexibility on Medicaid, and bringing down prescription drug prices. Then he said this:

…the time has come to give Americans the freedom to purchase health insurance across state lines…

This last line is the one we should remember. Allowing insurers to sell across state lines will require uniform regulations and will inevitably move us toward a system of federal health insurance regulation. Whether he intended it or not, Trump just succeeded in undermining the state regulation of insurance.

Interstate insurance sales have long been a component of Republican healthcare legislation and part of an ongoing debate about state vs. federal insurance regulation.

The Empowering Patients First Act (H.R. 3400) first introduced in 2009 and sponsored by then Rep. Tom Price (now Secretary of Health and Human Services) contains the following:

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Many of the current plans for repealing the Affordable Care Act contain similar provisions. From a draft proposal circulated in mid February:

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Speaker Paul Ryan is a big supporter of interstate insurance sales. A policy paper he released last summer lists it as a key recommendation.

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But we question whether Ryan really understands the conflicting policy implications of such a recommendation, because the same paper also contains the following:

States have been in the business of regulating health insurance for decades. They should be empowered to make the right tradeoffs between consumer protections and individual choice, not regulators in Washington. The federal role should be minimal and set a few broadly shared goals, while state governments determine how best to implement those goals in their own markets.

Sorry Speaker Ryan (and President Trump), you can’t have it both ways.  Allowing insurance sales across state lines will inevitably lead to federal regulation of the insurance industry.