Florida Election Shows Danger and Promise in Obamacare Debate

Mar 17, 2014Richard Kirsch

Democrats may have lost the special election for Florida's 13th congressional district, but the polling shows a path to success in 2014 with the Affordable Care Act.

Democrats may have lost the special election for Florida's 13th congressional district, but the polling shows a path to success in 2014 with the Affordable Care Act.

As pundits debate the impact of Obamacare on the special Congressional election held in Florida on March 11, a headline from a new Bloomberg national poll actually does as good as any describing what happened in the Sunshine State: “Americans Stick with Obamacare as Opposition Burns Bright.” That national finding also describes what happened in Florida, where swing voters supported the ACA, but more opponents turned out to vote.

The Bloomberg survey found the “highest level of acceptance for the law yet” in Bloomberg’s polling, with almost two out of three (64 percent) of those surveyed saying they supported either retaining the Affordable Care Act (ACA) with “small modifications” (51 percent) or as it is (13 percent).

The troubling result in the survey for the political prospects of the ACA is that the one-third (34 percent) who want to repeal the law are much more likely to vote. No news here. We’ve known that the ACA is a highly motivating issue for Republican voters, who turn out at a much higher rate in off-year elections than Democrats and independents.

The real news is in the first set of findings, the growing popularity of Obamacare outside the Republican base. These findings were confirmed in the Florida election, when Alex Sink, the Democratic candidate, pushed back against attacks on the ACA from David Jolly, the Republican candidate, and independent groups supporting him.

Jolly’s position was clear:  “I’m fighting to repeal Obamacare, right away.” So was Sink’s: “We can’t go back to insurance companies doing whatever they want. Instead of repealing the health care law, we need to keep what’s right and fix what’s wrong.”

The key part of Sink’s message was to remind voters why people wanted health care reform in the first place. As one of Sink’s TV ads said, “Jolly would go back to letting insurance companies deny coverage.” That’s an effective reminder of the huge problems Americans have had for decades, when insurance companies could deny care because of a pre-existing condition, charge people higher rates because they were sick, even charge women higher rates than men. The ACA ended all that.

As would be expected in Florida – and even more so in a special election – the candidates worked especially hard for the votes of seniors. In their ads for Jolly, the Republican Congressional Campaign Committee repeated their misleading charge from 2010, trying to scare seniors into opposing the ACA by saying that it cut $716 billion from Medicare. But unlike 2010, when Democrats did not respond to attacks on the ACA, Sink pushed back. She reminded seniors that the ACA actually provides important new Medicare benefits, including closing the infamous prescription drug “donut hole.” Sink’s ads accurately said, “His [Jolly’s] plan would even force seniors to pay thousands more for prescription drugs.”

By Election Day, voters had a clear contrast between the positions of the candidates on the ACA. It was a close election, with Jolly winning by a small margin (48.4% to 46.5%) in a district with an 11-point Republican advantage, one that has been represented by the GOP for nearly 60 years. But polling found that independent voters in the district supported the “keep and fix” position over the “repeal” position by a margin of 57% to 31%. Sink actually gained ground over Jolly during the election on the question of which candidate had a better position on the ACA.

The narrow margin is encouraging in a district with this large a Republican voter advantage, but still falls short of the turnout in 2012, when President Obama narrowly carried the district. Democrats will need to do better in November, if they are going to hold on to contested Senate races and have a chance of picking up House seats.

Fortunately, unlike in 2010, the Democratic Senate and Congressional campaign committees at least understand that they can’t run away from Obamacare. Doing so will cede independent voters to Republicans, just when those voters are becoming very supportive of the “keep and fix” message. While Democrats would prefer to keep the focus on the economic pressures being faced by American families – highlighting issues like the minimum wage – they’ll only be heard if they also engage aggressively in the fight over the ACA.

In fact, the ACA is an economic issue; just ask anyone who has lost her job and her health coverage. Or the millions of low-wage workers who can’t afford to go to the doctor, or are trying to pay back medical bills from the visit they could not put off. As millions more Americans get coverage – 11 million as of the end of February between the new exchanges, the expansion of Medicaid and young people under 26 – Democrats should incorporate the ACA into their overall economic message.

Supporters of the ACA have consistently believed that once the ACA began to be implemented, it would become more popular. We’re starting to see that shift. The challenge now will be turning that popularity into votes in November. 

Richard Kirsch is a Senior Fellow at the Roosevelt Institute, a Senior Adviser to USAction, and the author of Fighting for Our Health. He was National Campaign Manager of Health Care for America Now during the legislative battle to pass reform.

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The Story of Atalissa Highlights America's Long-Term Care Problem

Mar 11, 2014Sarah Galli

America's health care system neglects people who require long-term care and denies them the opportunity to lead full, rewarding lives.

Since the moment my brother was rendered a quadriplegic in a diving accident when we were teenagers, I have maintained a constant, silent stress in my body. I am worried about health complications inherent in a paralysis injury, terrified for what happens when my parents are no longer able to serve as Jeff’s primary caregivers.

America's health care system neglects people who require long-term care and denies them the opportunity to lead full, rewarding lives.

Since the moment my brother was rendered a quadriplegic in a diving accident when we were teenagers, I have maintained a constant, silent stress in my body. I am worried about health complications inherent in a paralysis injury, terrified for what happens when my parents are no longer able to serve as Jeff’s primary caregivers.

My brother is, aside from requiring constant care for his injury, in good health. My parents have done an exceptional job of keeping his life, unlike his cervical vertebrae, stable.

We are, in many ways, lucky.

The same cannot be said for a group of men my father’s age in Atalissa, Iowa.

In a groundbreaking feature released last weekendThe New York Times profiled a group of Iowan men with intellectual disabilities who were forced to perform backbreaking hard labor for more than 30 years, housed in filth by "caregivers" who did nothing of the kind. These men, who worked in a slaughterhouse for hours on end, with no treatment or support for their disabilities, lived in a schoolhouse so squalid they had to cover their dinner plates to protect them from cockroaches. Many still have chronic health issues resulting from such neglect.

Wrote Times reporter Dan Barry, “Every morning before dawn, they were sent to eviscerate turkeys at a processing plant, in return for food, lodging, the occasional diversion and $65 a month. For more than 30 years. Their supervisors never received specialized training; never tapped into Iowa’s social service system; never gave the men the choices in life granted by decades of advancement in disability civil rights. Increasingly neglected and abused, the men remained in heartland servitude for most of their adult lives.”

Since they were discovered in 2009, advocates and social workers have worked to give these men a sense of freedom seemingly granted to everyone but individuals with disabilities. These men each lost over 30 years of their lives because Iowa failed to protect them from their designated protectors. Families were told Henry’s Turkey Service was the best option for their sons and brothers. Instead, these men were as much prisoners as the turkeys they were told to tear apart.

Reports of barbaric conditions surfaced every few years; no action was taken.

A few men tried to escape; one, Alford Busby Jr., ran away during a 1987 snowstorm: “Local officials searched the wintry landscape without success. Three months later, during the spring thaw, a farmer found a body along a field’s fence row, a quarter-mile from the main road. Mr. Busby was 37, or maybe 43. 'Mentally retarded man wandered away from home in subzero temperature,' his death certificate says, citing hypothermia.”

The men were rescued five years ago. They now receive Social Security and Medicaid, they have homes to live in and care for them, and they are paid wages for jobs worked. They have the freedom to meet new people, date, and live a life they’ve chosen.

The Times piece exposed my greatest fear: what will happen when my parents are no longer able to provide for Jeff, when my brother will have to join the ranks of thousands of Americans who require 24/7 care and lodging somewhere separate from their chosen home.

My father spent the summer as an embedded journalist in Baghdad a few years ago, and because my mother couldn’t work her full time job and also fill the holes in nursing care normally covered by my dad, my brother was forced to stay temporarily in a nursing home. I would travel from Manhattan to see him in Rhode Island, and attempt to hide my tears until after I’d left. A nurse came over at the end of one such visit, and in what she intended to be a moment of trust between us, gave Jeff a kiss on the cheek. I wanted to tackle her to the ground, furious that this stranger was playing at false intimacy with a young man she knew nothing about.

Instead, I choked back tears and left my twentysomething brother in his room, a bright young man relegated to living in a home with elderly residents in a system that treats them all as if they're just waiting to die.

President Obama proposed the Community Living Assistance Services and Supports (CLASS) program as part of the Affordable Care Act, which offered voluntary long-term care insurance. But that support (granted to eligible workers after five years, not taking into account exceptions for those whose disabilities preclude employment) capped out at a lifetime cash benefit of $75 a day/$27,000 per year. According to the National Spinal Cord Injury Statistical Center, the average yearly expenses for someone with a high-level spinal cord injury run an average of $181,328, not including indirect costs.

The CLASS Act has since been repealed and replaced with a long-term care commission; there is no word on what recommendations will come, nor when.

The Christopher & Dana Reeve Paralysis Act, passed in 2009, aimed to further scientific research and improve “quality of life” and rehabilitation options for individuals living with paralysis. But there has not yet been comprehensive legislation to protect Americans with chronic spinal cord injuries as their caregiving options change over time. There is no mechanism to support independent living for someone with a high-level injury, and no understanding that an otherwise healthy, capable person should not be relegated to the same care granted to the elderly. 

Curt Decker of the National Disability Rights Network said the Iowa story “is what happens when we don’t pay attention.” I read about the men of Atalissa and I mourn for the years lost, taken away from these sons and brothers.

And I wonder who will care for mine.

Sarah Galli is the Political Action co-chair of Women’s Information Network (WIN.NYC). She is also the Founder & Executive Producer of Born for Broadway, whose mission is to raise funds for paralysis research through special events, education, and advocacy. For more information, please visit www.sarahgalli.com.

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The Simple Solution to Obamacare's Employer Mandate Problems

Mar 3, 2014Richard Kirsch

Requiring employers to offer insurance to all employees or pay an additional payroll tax would eliminate the problems with the employer mandate, and start a shift toward broad tax-based coverage.

Requiring employers to offer insurance to all employees or pay an additional payroll tax would eliminate the problems with the employer mandate, and start a shift toward broad tax-based coverage.

In the last month, two more misleading headlines – one on lost jobs and the other on premiums for small businesses – have further roiled the overheated debate about the impact of the Affordable Care Act (ACA) on business and jobs. The question of how to deal with our employer-based health system continues to provide fodder for attacks on Obamacare. And it has proven to be  – and promises to continue to be – the basis for the most potent attacks against Republican proposals to replace the ACA. But in terms of policy, there is a simple solution, which would rationalize the contradictions in the Affordable Care Act and ease the way for the long-term goal shared on the left and right of separating health coverage from employment.

The general approach taken in the Affordable Care Act was to require most employers to provide coverage. The specific proposal in the final legislation, shaped by compromises with and pressure from both small and big business lobbying groups, required employers with more than the equivalent of 50 full-time workers to pay a portion of health coverage for employees who work 30 hours a week, or pay a fine. This is the employer mandate, which was delayed a year by the Obama administration and will be phased in starting in 2015.

The employer mandate does accomplish much of the prime goal of reform. Most employers have incentives to continue to provide coverage, or expand coverage. New coverage options are available for most people who do not get coverage at work, which was virtually all of the 50 million people who were uninsured when the ACA became law in 2010. People are not locked into jobs just because of health coverage, which was the real finding of the Congressional Budget Office report projecting 2.3 million people would retire or reduce their hours of work. Ending job lock opens up those hours to people who want to work and is a huge boon to entrepreneurship.

But the problems with the structure of the employer mandate are obvious. The law creates incentives for employers to keep workers’ hours under 30. It also establishes the potential for a business with a growing number of employees, when it exceeds the 50-employee threshold, to suddenly have to pay for health coverage.

The existence of incentives to cut hours or limit employees does not at all mean that employers will adjust for them. The accusations that the ACA is creating a part-time economy are belied by the facts: part-time employment is going down as the economy accelerates. In addition, employers that are adding workers rapidly as their businesses grow are not going to stop expanding  – or establish dozens of very small corporations – to avoid paying for health coverage. Still, we are seeing examples of some employers, including public employers and universities, limiting workers’ hours to less than 30. Others, like Trader Joe’s, are establishing different employment tracks for part and full time employees, with health care as a key factor. As this is all new – with the mandate not yet in effect – it is impossible to measure the future impact, but the incentives are certain to shape some business decisions.

There is a simple solution, one that was included in the version of the ACA enacted by the House in 2009. Employers that decide not to provide health coverage for their employees would be required to pay a percentage of payroll as a tax to cover health care, just like employers do now for FICA (Social Security and Medicare). Instantly, the cliff impact is gone, both in terms of hours and number of employees. Employers could either provide coverage to all employees, or pay for health coverage in the same manner as FICA, a regular cost of adding an employee, with a marginal increase in cost for each hour someone works. There is no advantage to hiring someone for less than 30 hours or keeping under 50 employees.

Paying a percentage of payroll also has another huge advantage over both the ACA and the current system of employer-provided coverage. Right now, the cost of health insurance premiums does not vary with an employee’s income. This creates a much bigger disincentive to hiring lower-wage workers. For example, a $6,000-a-year policy is 20% of the wages of a $30,000 a year employee but only 5% of the pay of a $120,000 a year employee. Paying a percentage of payroll instead would make it much more affordable to hire low-and-middle income wage earners than it is now. And while it would make it more expensive to employ higher-wage workers, most employers with high-wage workforces already provide health coverage and would be likely to continue to do so, rather than pay the payroll tax. If they did choose to pay, the cost is more easily absorbed for high-wage employees. Besides, that is not where we have an employment problem in the U.S.

This solution mimics the structure of union-employer benefit funds, which are typically found in industries where workers have fluctuating hours. Under these “Taft-Hartley” funds, employers and workers pay into the fund based on the number of hours an employee works. The loudest opponents from the left of the employer mandate in the ACA have been unions whose members get health coverage through such funds now. The unions have said that the ACA encourages employers to stop paying into the funds, now that government will provide subsidies for many workers. But if the current employer mandate were replaced by a payroll tax, the status quo that has worked well for these funds would be maintained.

Historically, the biggest opponent of a payroll tax for coverage has been the small business lobby, which is why the ACA does not require small employers to provide coverage. That is why the House version of the ACA phased in the payroll contribution based on payroll size, with no contributions required for payrolls under $500,000, increasing gradually to an 8% contribution for payrolls over $750,000.  This eases the burden on small employers.

Slowly, the employer-based health coverage system in the United States is dissolving. Over the past 30 years, the share of workers with ESI has shrunk from 70% to 57%. Recently we have seen employers who traditionally have wanted to take responsibility for structuring employee coverage begin to use private exchanges, in which their workers get a fixed amount of money to choose from a choice of health plans. These trends hasten the broadly shared goal of separating employment from health coverage.

As the debate over the ACA turns from repeal to fixing the law, progressives should make the payroll contribution proposal a central focus, our response to problems with the employer mandate. If enacted, as more employers choose to pay into the fund rather than provide their own coverage, we would move closer to ideal of a broad-based tax for coverage, not tied to an individual employer. And while a payroll tax is not progressive – it is proportional – it is much more progressive than the very regressive system we have now of fixed premiums regardless of income. The result would be evolution toward a relatively broadly based tax for health coverage, a key to making health coverage a right. 

Richard Kirsch is a Senior Fellow at the Roosevelt Institute, a Senior Adviser to USAction, and the author of Fighting for Our Health. He was National Campaign Manager of Health Care for America Now during the legislative battle to pass reform.

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AOL's CEO Proves Women and Children Make Easy Scapegoats in the Workplace

Feb 14, 2014Andrea Flynn

The law has put maternity care on an equal footing with other health benefits for decades -- but some executives still haven't caught up.

The law has put maternity care on an equal footing with other health benefits for decades -- but some executives still haven't caught up.

AOL CEO Tim Armstrong recently ignited a firestorm of criticism when he announced the company would be restructuring its retirement benefits. Armstrong explained that the financial burden of Obamacare and the deliveries of two “distressed babies”, which cost the company $1 million each, had forced the company to reduce 401(k) matching contributions:

We had to decide, do we pass the $7.1 million of Obamacare costs to our employees? Or do we try to eat as much of that as possible and cut other benefits? …Two things that happened in 2012. We had two AOL-ers that had distressed babies that were born that we paid a million dollars each to make sure those babies were OK in general. And those are the things that add up into our benefits cost.

Sorry, AOL employees: you can either get your expensive babies or your retirement benefits, but you can’t get both.

Armstrong has since issued a public apology and, amidst uproar from his employees, reversed the benefits decision. But his remarks remain significant, illustrating the readiness of employers to use maternity costs and the new health law as scapegoats for other business decisions that affect company profits. His comments also reflect the extent to which pregnancy, childbirth, and childcare are considered lower priorities in the workplace than other health benefits.

In an era of ever-rising health costs, it is certainly reasonable for AOL to seek ways to reduce health spending. But why single out premature births instead of, say, cancer or diabetes cases? Apparently in American corporate culture maternity coverage is still considered a “bonus” benefit that employees should feel lucky to have. You’d think this wouldn’t be the case at AOL, whose decade-old Well Baby program provides education and support for employees throughout the pre-natal and post-partum stages. Armstrong’s comments run counter to AOL’s public persona of being a company truly invested in the health and wellness of its parents and their families.

Maternity coverage should be considered a routine component of employee benefits, especially since they have been mandated in employer health plans for more than three decades. In 1978, Congress passed the Pregnancy Discrimination Act (PDA) – an amendment to the 1964 Civil Rights Act – in an effort to end pregnancy-based discrimination in the workplace. Benefits required by the PDA are both ethically sound and financially prudent. Research has shown that every dollar spent on prenatal care saves employers $3.33 in postnatal care expenses and $4.63 in long-term morbidity costs.

Based on Armstrong’s comments one might assume $1 million births a commonplace occurrence, but they aren’t. It’s true that one in every eight infants in the United States is born pre-term, but the average cost of care for the majority of those babies doesn’t come close to seven figures. Approximately 70 percent of infants admitted to the NICU stay for longer than 20 days, which typically costs between $40,000 and $80,000. The high costs associated with the two pre-term births to which Anderson refers are not the norm.

Why should the economic security of employees be first on the chopping block? Armstrong might have been a bit more introspective before publicly pointing his finger at his employees’ pre-term babies. After all, shortly before his gaffe went viral, he was in the harsh glare of the media spotlight for the overwhelming failure of Patch, a media venture he championed that lost AOL $300 million (last month the company cut its losses and sold its majority stakes in the site).  Two million dollars in NICU expenses seems quite reasonable by comparison.  

AOL, like many large companies, is self-insured.  As such, it directly pays employee health costs and assumes that the risk of catastrophic health events is worth the expanded choices in health benefits and the increased savings that results when income from premiums exceeds health costs. It’s unfair for companies to sacrifice the economic security of their employees when those bets don’t pay off.

It is simply dishonest to lay the blame for such losses of maternity care and Obamacare expenses. After all, the new law will improve the health of employees and generally lower employer costs in the long run by mandating the full coverage of family planning, women’s preventive health care, and extended coverage for children of employees. These measures will reduce unplanned and mistimed pregnancies (which still account for nearly half of all U.S. pregnancies) and enable women and their families to prevent and treat health conditions long before they become emergencies.

We must not regard maternity coverage as a bonus benefit. It is indeed a benefit central to employee health coverage and essential to the economic security and overall wellbeing of American workers and their families. The inherent value in such coverage was enshrined in laws passed more than 30 years ago, and has been reaffirmed by Obamacare. It’s long past time for executives like Armstrong to live and speak those same values when making decisions that affect the health and security of their employees. 

Andrea Flynn is a Fellow at the Roosevelt Institute. She researches and writes about access to reproductive health care in the United States. You can follow her on Twitter @dreaflynn.

 

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A New Medicare Penalty Puts the Focus on Community Health

Feb 13, 2014Anisha Hegde

The Affordable Care Act could force the U.S. to expand community health programs, and that would be good for patients.

With the implementation of the Affordable Care Act (ACA), hospitals will be penalized if Medicare patients are readmitted within a month for several illnesses, including heart attacks and pneumonia, and private insurers are likely to follow suit. This component of health reform provides fertile ground for a fortification of community health, which focuses on improving the wellness of a geographic area largely through preventive measures.

The Affordable Care Act could force the U.S. to expand community health programs, and that would be good for patients.

With the implementation of the Affordable Care Act (ACA), hospitals will be penalized if Medicare patients are readmitted within a month for several illnesses, including heart attacks and pneumonia, and private insurers are likely to follow suit. This component of health reform provides fertile ground for a fortification of community health, which focuses on improving the wellness of a geographic area largely through preventive measures.

Before health reform, readmitting patients soon after their discharge allowed hospitals to fill beds and receive more money from Medicare by billing for the hospital stay and treatment. The New England Journal of Medicine estimated that this incentivizing of superfluous re-hospitalizations was costing Medicare $17.4 billion annually. Now, however, hospitals are encouraged more than ever to pay attention to what happens to their patients after they are discharged.

Although the punishment of unnecessary readmissions is an imperfect solution, as the burden of punishment may fall heavily and unfairly on hospitals that treat very sick and very poor patients, it does put the focus on bolstering primary health care for the country’s most vulnerable patients. In a law that includes stipulations such as paying physicians a flat rate for Medicare visits no matter the complexity of a patient’s illness – a stipulation that has forced many physicians to reduce the number of Medicare patients they treat – the penalizing of unnecessary readmissions could be one stipulation that revitalizes community health.

Thus far, this renewed focus on community health has taken the form of hospitals setting up follow-up appointments for patients who lack primary care physicians. or sending nurses to visit with patients at home. Funding and personnel support for these initiatives is coming largely from community health foundations and nonprofits such as Sun Health. As a New York Times article relates, nurse home visits reduce re-hospitalizations by explaining to patients in a more intimate setting the importance of their medications and the side effects they could experience and, if necessary, by recommending that the patients seek an alternative prescription. Nurses are also effective at sending patients back to the hospital when they truly do need to be readmitted. Additionally, hospitals are contracting with companies such as PreMedex, whose employees call patients post-discharge to ask important questions geared toward health maintenance, such as if the patients have had any fever or pain since they left the hospital.

As many millennials prepare to enter health professions, we have an opportunity to reshape the system. This means pursuing existing programs like PreMedex and continuing to amplify and support the primary care physician core, but also exploring novel ways of tracking and promoting community health. For instance, the U.S. could take a page from the playbook of developing countries like Ethiopia and Rwanda, where doctors and nurses train trusted members of a community to help individuals understand preventive care practices and cope with treatment plans. The U.S. has about 38,000 community health workers, but unlike in other countries, their roles are nebulous, they do not have to go through a standardized accreditation process, and they lack a clearly structured source of funding. A study by the American Public Health Association found that the intentional and structured employment of these workers would result in savings for both patients and providers.

As the Affordable Care Act is implemented and Medicare penalties are incrementally increased to their prescribed level by October 2015, policymakers at all levels must evaluate the gaps that health reform leaves to be filled – namely how to construct the bridge between the newly insured population and health actors whose roles have been redefined, such as hospitals now having a stake in preventive health and primary care clinics now serving a larger population. The success of organizations such as Sun Health in reducing re-hospitalization has already started to show that the feat of sustaining accessible yet quality health care can indeed be accomplished.

Anisha Hegde is the Roosevelt Institute | Campus Network Senior Fellow for Health Care.

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A CBO Report Shows How Obamacare Will Help the Working Poor

Feb 6, 2014Jeff Madrick

Never mind the conservative fear-mongering. The Affordable Care Act's subsidies will boost the economy and free workers who were locked into their jobs.

Never mind the conservative fear-mongering. The Affordable Care Act's subsidies will boost the economy and free workers who were locked into their jobs.

The attack on the Affordable Care Act by conservative Republicans after the release of the Congressional Budget Office's new report was desperate. Bravo to much of the media for setting the story straight almost immediately. But so strong is the anti-government bias involving social policy that critics hardly stopped to think.

No, businesses were not about to issue a couple of million pink slips, as Senate Republicans put it. Rather, because of the subsidy to buy health care, people could choose to quit their jobs or work fewer hours and lead a marginally better life. Heaven forbid.

And that’s the real rub. Republicans must think this is a new dole for the undeserving. But actually, it’s another example of how perverse and unfair the health care system in America is. In other words, according to CBO estimates, 2 million people or so were basically working so they could get insurance. Working makes acquiring health care cheaper because you are in a group plan and the employer will often help subsidize the price. (Of course, that subsidy partly results in lower wages for the worker.)

Because many Americans work just to get health care, they are locked into their jobs. And this may reduce their desire to bargain for higher wages out of fear of being fired.

A few points should be kept in mind. The determinedly objective CBO is by no means always right. It is a peculiar construction, in fact. The CBO is not allowed to make sensible assumptions about the economy, but instead has to stick to the current law. So it can’t anticipate, except as an exception to the main forecast, a change in tax rates or stimulus. The CBO builds in a recovery from a recession automatically—a clockwork interpretation of what economists know as Say’s law, which holds that economies will bounce back automatically as wages, prices, and interest rates stagnate or fall. This notion was anathema to John Maynard Keynes. The CBO makes absurdly precise projections of events 10, 20, and 30 years out. All the while, it wears the mask of objectivity.

The CBO’s estimate that Obamacare will result in 2 million people or so leaving the workforce, it admits, is “substantially uncertain.” There’s an understatement. Just a couple of years ago, it figured the number to be much less. But it says it did a more comprehensive analysis and included a few more recent studies, mostly about cuts in Medicaid. Some studies show that when a couple of states cut funding for Medicaid, people started looking for work. Other studies show little impact, however.

A subsidy for the poor, as Obamacare is, benefits the poor. As the working poor make more money, however, the subsidy diminishes. They may leave their jobs as a result, now able to afford health care on their own.

The CBO also said, however, that Obamacare “will boost overall demand for goods and services over the next few years because the people who will benefit from the expansion of Medicaid and from access to the exchange subsidies are predominantly in lower-income households and thus are likely to spend a considerable fraction of their additional resources on goods and services.” In contrast, people who will pay the modest increase in taxes to support the subsidies “are predominantly in higher-income households and are likely to change their spending to a lesser degree.”

Just what the doctored ordered for a sick economy!

In addition, the drop in total labor compensation as people quit their jobs will be less than the drop in the number of hours worked. Fewer hours worked but not as much lost in income. Pretty good policy. 

Jeff Madrick is a Senior Fellow at the Roosevelt Institute and Director of the Bernard L. Schwartz Rediscovering Government Initiative.

 

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Daily Digest - February 5: What the CBO Really Said About Health Care Reform

Feb 5, 2014Rachel Goldfarb

Click here to receive the Daily Digest via email.

‘Obamacare Bailout’ Does Not Exist, Confirms Government; House Republicans Demand Its Repeal Anyway (NY Mag)

Click here to receive the Daily Digest via email.

‘Obamacare Bailout’ Does Not Exist, Confirms Government; House Republicans Demand Its Repeal Anyway (NY Mag)

Jonathan Chait writes that the GOP insists that an Affordable Care Act provision that taxes and reimburses insurers based on the health of their customers must be another big government bailout, but the Congressional Budget Office and Roosevelt Institute Fellow Mike Konczal's definition of bailouts contradict them.

Obamacare Is Not a Job Killer (TNR)

Jonathan Cohn notes that while the CBO's analysis shows the Affordable Care Act will cause a decrease in labor output, that is actually a good thing. The reduction in hours won't be due to fewer jobs, but will primarily be people who are choosing to work less, retire earlier, or start their own businesses.

Can Marriage Cure Poverty? (NYT)

Annie Lowrey writes that Republicans like Marco Rubio have it backwards when they suggest that pushing marriage would solve all other social ills. In fact, she says, it's poverty that is getting in the way of stable, lasting marriages.

Congress Passes $8.7 Billion Food Stamp Cut (MSNBC)

Ned Resnikoff reports that the Senate has joined the House in passing a version of the Farm Bill that makes significant cuts to food stamps. The president is expected to sign this bill, which will cut about $90 a month in benefits for 850,000 households.

AOL is Leading the Way to Make 401(k)s Worse for Everyone (WaPo)

Jia Lynn Yang explains that by changing 401(k) matches to lump sums at the end of each year, AOL punishes employees who leave their job mid-year. That saves the company plenty of money, and if implemented more broadly, would be a major financial loss for workers.

New on Next New Deal

In 'Nuestro Texas,' A Call for Human Rights in Reproductive Health Care

Roosevelt Institute Fellow Andrea Flynn looks at a new report on access to reproductive health care in the Rio Grande Valley. New laws have turned circumstances in that region so dire that according to international standards, its a human rights violation.

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In 'Nuestro Texas,' A Call for Human Rights in Reproductive Health Care

Feb 4, 2014Andrea Flynn

A new report on access to reproductive health care in the Rio Grande Valley highlights the human rights violations happening right in the U.S.

A new report on access to reproductive health care in the Rio Grande Valley highlights the human rights violations happening right in the U.S.

During the past three years, more than 150,000 women in Texas have lost access to reproductive health services, thanks to a relentless barrage of laws and policies that have shuttered 76 family planning clinics across the state. A disproportionate number of those women live in the Rio Grande Valley, a region with extreme health disparities and some of the nation’s highest levels of poverty and unemployment.

Cover of the Nuestro Texas reportA recent report – Nuestra Voz, Nuestra Salud, Nuestro Texas – co-authored by the Center for Reproductive Rights (CRR) and the National Latina Institute for Reproductive Health (NLIRH) illustrates the dire impact that three years of draconian policies have had on women in the valley. During a briefing at the Roosevelt Institute last week, Katrina Anderson, Human Rights Counsel at CRR, and Jessica González-Rojas and Diana Lugo-Martinez, NLIRH’s Executive Director and Senior Director of Community Engagement, shared the report’s findings and conveyed the stories and experiences of the more than 180 local women they have interviewed.

Nuestro Texas stands out because it illustrates the deeply personal impact of the state’s restrictions and regulations, but it is also unique because it frames Texas women’s rights as fundamental human rights issues, using international standards – a framing infrequently used when addressing women’s health in the United States.

Communities across Texas are feeling the acute pain of the rapid destruction of a once robust public health infrastructure, and the most harm has been done along the state’s Southeast border with Mexico. Nine of the Valley’s 32 health clinics have closed, and those remaining open have curtailed hours, reduced staff, increased fees, and eliminated some services. Before the cuts, public clinics in the valley served nearly 20,000 patients. Today they serve just over 5,000.

Nuestro Texas tells the stories of women who now seek care in Mexico, or purchase black-market medications, or forgo family planning and medical care altogether because the barriers of cost, travel, and immigration status are simply too great. Women live with the anxiety of undiagnosed and untreated breast lumps, cervical pain, sexually transmitted diseases, and a host of other adverse health issues.

Beyond declining access to family planning and a full range of women’s health care services, abortion services have all but disappeared in the Valley thanks to the sweeping anti-choice legislation passed last year by the state legislature in Texas. As a result, reports of incidents of self-abortion are becoming commonplace, because without other options women will take the termination of unplanned pregnancies into their own hands, as they did for decades before abortion was legalized in 1973. Even before the 2011 budget cuts and recent abortion restrictions, the estimated rate of self-induced abortion in Texas was more than twice that of the nation overall, and the rate along the border was more than five times greater than the national rate. Recent articles by Andrea Grimes (RH Reality Check) and by Lindsay Bayerstein (The New Republic) illustrate the dire consequences of regulating reproductive health care into obscurity.

Despite the profound stresses women in the valley now endure, at the Roosevelt Institute briefing González-Rojas maintained that they are not simply “victims of systemic barriers.” They are using their voices to advocate for the health and rights of women and families. Outreach workers help navigate immigration and transportation barriers so that women can access needed care in Mexico, if necessary. They host community meetings where women can share their frustrations, fears, and experiences. They teach self-breast exams and educate about the warning signs of sexually transmitted diseases, even though there are few clinics to see women who may need care.

González-Rojas explained that framing women’s rights as human rights has positioned reproductive health as a family and community issue, one that requires multiple voices and solutions to address. Focusing on human rights has empowered women in the valley to organize and mobilize for policy change. They teach communities about immigration, health, and economic policies and encourage them to fight back by protesting, petitioning lawmakers, and – when possible – by voting. Lugo-Martinez said Valley residents have become engaged and excited about human rights and are routinely sharing copies of the landmark 1948 Universal Declaration of Human Rights at community meetings.

“Women in the Valley will not rest until they can get care when and where they need it,” González-Rojas said. Nor should we remain complacent, for it would be wrong to assume that what is happening in Texas will stay there. “Texas is the epicenter of bad reproductive health policy, but it is also the incubator of those policies. What happens in Texas really matters,” said Anderson.

States across the nation are now following Texas’s lead in significantly restricting women’s access to reproductive health care. Nuestro Texas demonstrates the urgency of accelerating legal and policy trends across the country, as conservative legislators pursue an unrelenting anti-choice, anti-women’s-health agenda. 

Andrea Flynn is a Fellow at the Roosevelt Institute. She researches and writes about access to reproductive health care in the United States. You can follow her on Twitter @dreaflynn.

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State of the Union 2014: Obama Offers Action, Not Apologies

Jan 29, 2014Jeff Madrick

The president promised to do what he can without Congress, even if it isn't much.

From a political point of view, President Obama gave one of the best speeches of his presidency last night. In this, his fifth State of the Union Address, he avoided all apologies. No word about the slow progress on cutting unemployment, or the failure of the healthcare.gov rollout, or the inability to pass gun control, or the extreme excess of government intrusion on America privacy.

The president promised to do what he can without Congress, even if it isn't much.

From a political point of view, President Obama gave one of the best speeches of his presidency last night. In this, his fifth State of the Union Address, he avoided all apologies. No word about the slow progress on cutting unemployment, or the failure of the healthcare.gov rollout, or the inability to pass gun control, or the extreme excess of government intrusion on America privacy.

His tone was resolute and optimistic, and he struck many progressive chords. He made a nation that is down feel up. President Obama in particular made a strong case for a higher minimum wage. Commentators like David Brooks have pooh-poohed this because it wouldn’t raise that many families above the poverty line. This is the height of insensitivity. The poverty line is desperately low in America. But more than half the benefit would go to families that earn $40,000 or less, families in which one of its members will get a raise—usually an adult—if the minimum wage is raised. That’s a family, not an individual. And the higher minimum wage bumps up wages just above it.

Any idea that Americans are getting paid what they deserve, which is the assumption the Brookses of the world make, is a triumph of utopian insensitivity.

President Obama gave a shoutout to Senator Tom Harkin, who is leading the campaign for a $10.10 minimum wage in Congress. We are proud to say that Senator Harkin was our keynote speaker at the Bernard L. Schwartz Rediscovering Government Initiative's jobs emergency conference last year.  

But as I say, the president didn’t dwell in the realm of apology. He will raise pay for those on federal contracts. He talked about equal pay for women. He wants an immigration bill. He implied that inequality cannot be tolerated at this level in America. He would offer subsidies for business to bring jobs home.

All these struck optimistic notes. But he avoided the policies that really need doing. Sequestration has to be ended and government spending pumped up to get unemployment lower at a faster pace. But he did not talk about fiscal stimulus. He would live within the bounds of the austerity economics he helped bring about, even if he was not nearly as responsible for it as the Republicans.

He did not talk much about fixes to Obamacare but made clear it is helping millions already. This may sound like rhetoric, but it is critical. Too few realize how beneficial the new plan is—which has partly been Obama’s fault. He has avoided talking much about it. Last night he came out swinging, justifiably so. But it needs some fixes, and eventually a public option.

The headline is that Obama says he will do what he can with or without a recalcitrant Congress. The truth is he can’t do much. But for a president who has not taken the battle to the members on the Hill, this speech was a triumph and long in coming. He put Congress on the spot. He should keep using the bully pulpit, unafraid to do so, because he is right and they are mostly wrong. 

Jeff Madrick is a Senior Fellow at the Roosevelt Institute and Director of the Bernard L. Schwartz Rediscovering Government Initiative.

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Republican Alternative to Obamacare: Pay More, Get Less, Put the Insurance Companies Back in Charge

Jan 28, 2014Richard Kirsch

Now that Republicans have put out an alternative to the Affordable Care Act, Democrats should emphasize what a repeal would really mean for Americans' health.

Now that Republicans have put out an alternative to the Affordable Care Act, Democrats should emphasize what a repeal would really mean for Americans' health.

Boy, can Democrats have fun with the new Republican alternative to Obamacare. It puts the health insurance companies back in charge and raises costs for almost all Americans. In particular, it substantially raises costs and threatens to cut coverage for the half of all Americans who get health insurance at work. Seniors, the group that Republicans have scared witless about Obamacare, would lose the real benefits they receive under Obamacare. The proposal from three Republican senators is a golden opportunity for Democrats to contrast the specific benefits of the Affordable Care Act (ACA) with what a repeal and replace agenda would really mean for Americans’ lives and health.

When it comes to the politics of health care reform, my first adage is “the solution is the problem.” That is because once you get past vague generalities, like lowering cost and making coverage available, to proposing specifics, people will look to see how the proposals impact them personally. This is why health reform is such a political nightmare. Unlike most public policy issues, the impact is very understandable and real.

With the ACA as the law of the land, in analyzing the Republican proposal we must compare its impact to the law it would repeal. The pre-ACA model of health insurance is irrelevant. Here is how the Republican plan would impact people, compared with the ACA:

People who get health insurance at workbottom line: pay more for worse coverage.

Almost half of all Americans (48 percent), or 148 million people, obtain health insurance at work. The Republican plan would tax 35 percent of the average cost of health insurance benefits at work. This is a big tax increase on working people and is extraordinarily unpopular, as the Obama campaign used to devastating impact on John McCain. And while people would pay more, they would get less coverage, as the GOP plan would allow insurance companies to once again limit the amount of benefits they will pay out in one year and return to the day when employers could offer bare-bones plans.

While taxing health benefits would apply to all employer-provided coverage, the Republicans would give the 30 percent of people who work for businesses who employ fewer than 100 workers a tax credit. That might balance out the increased taxes for some people. However, doing so would create a huge set of economic distortions, as employers might seek to keep firm size under the 100-employee threshold.

Individuals who buy coverage on their own or who are uninsured – bottom line: insurance companies could again deny coverage for pre-existing conditions and offer bare-bones coverage, while the cost of decent coverage would go up for most people.

This is the group that the ACA is most aimed at helping, including the 5 percent of Americans who buy private health insurance and the 15 percent who are uninsured, totaling 64 million people. The ACA offers income-based subsidies to these people when they earn between 100 percent and 400 percent of the federal poverty level (FPL) and enrolls people under 133 percent of FPL in Medicaid, when states agree.

The Republican plan is toughest, in comparison with the ACA, on the lowest income people and on the higher-income middle-class, compared with Obamacare. But many families in between will do worse too.

The Republican plan would wipe out the expansion of Medicaid to people earning less than 133 percent of FPL, a provision the Supreme Court has made optional. It would cut back on Medicaid, ending the federal government’s offer to pay 90 percent of the cost of expanded coverage and replacing that with the federal government paying what it has paid historically, which is between half and three-quarters of the cost of Medicaid, with poorer states getting a bigger share. Crucially, the funding would only be for pregnant women, children and parents with dependent children who earn under the poverty level, as opposed to the ACAs funding of all adults up to 133% of FPL. That means many fewer people covered and states getting less Medicaid money. Republican governors may not complain, but you can bet hospitals will. Adults without dependent children would not be covered by federal Medicaid, which means millions will stay uninsured or lose coverage they now have, unless states pay for coverage without federal support.

For individuals not covered by Medicaid or employees of firms with fewer than 100 workers, the Republican plan would replace the ACA’s sliding-scale subsidies, which now go to 400 percent of FPL, with a subsidy that is the same for everyone of the same age who is under 200 percent of FPL and lowersubsidies for people from 200 percent to 300 percent. In addition, the subsidies would be higher for older people than younger. The Republican plan also would take away the requirements that insurance plans offer decent benefits and free preventive care and charge women the same prices as men for coverage, along with every other consumer protection, with the exception of keeping in place no lifetime caps for covered benefits.

Comparing the value of the Republican plan subsidies vs. the ACA subsidies for the people who would still qualify depends on income, age, and family size. Generally, it appears that the Republican subsidies are much less than the ACA for people under 150 percent of the FPL ($35,000 for a family of four) and much less than the ACA for younger people, but more for older people. However, insurance rates for younger people would go down some at the expense of older people, who insurance companies could charge a lot more than under ACA. And families with incomes above $70,000 for a family of four would lose subsidies entirely.

Seniors and the disabled on Medicare – bottom line: seniors would pay more for prescription drugs and preventive care.

By repealing the ACA, the Republican plan would take away its two concrete benefits for seniors. One is that preventive care services are now free under Medicare (as they are under all insurance). The other is that the ACA is lowering drug prices for seniors by slowly closing the “donut hole,” under which seniors must pay the full cost of prescription drugs even though they are paying premiums for drug coverage. In other words, the Republican plan is simply bad news for seniors, the constituency that they have scared the most about Obamacare groundlessly.

 

It is not surprising that Republicans have been reluctant to come up with a replacement for Obamacare. It’s much easier to throw darts – or bombs – at the ACA than to come up with a replacement that meets Republican ideological tenants of less regulation and less government. Any plan that meets the ideological test will be much worse for people in ways they can understand. It is our job to explain it to the public clearly: pay more, get less, put the insurance companies back in charge. This debate is not simply the political game Republicans want to make it. It is about our health and our lives. 

Richard Kirsch is a Senior Fellow at the Roosevelt Institute, a Senior Adviser to USAction, and the author of Fighting for Our Health. He was National Campaign Manager of Health Care for America Now during the legislative battle to pass reform.

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