Feds letting Arkansas privatize Medicaid expansion; idea could spread like wildfire, as in Florida, but cost questions remain

Arkansas has turned heads nationally with its preliminary plan to expand Medicaid using the private insurance market, showing that the Obama administration is willing to give states more flexibility than expected in expanding the program.

Health and Human Services Secretary Kathleen Sebelius has agreed to a proposal by Arkansas Gov. Mike Beebe to reject the Medicaid expansion but use federal money to buy private health insurance for the 200,000 people who would have been covered under ordinary expansion, reports Sandhya Somashekhar of The Washington Post.

States that have come down on either sides of the Medicaid-expansion issue may reconsider their decision in light of the Arkansas proposal, said Sara Rosenbaum, a health law professor at George Washington University. "If Arkansas is allowed to do this, I expect it to spread like wildfire," Rosenbaum told the Post.

The first place could be Florida, where a state Senate committee rejected Republican Gov. Rick Scott's expansion plan and proposed a privatization plan like that in Arkansas. Last week, a House committee voted to reject any expansion of the program. Scott "made it clear he was not going to lobby the Legislature on Medicaid," preferring to emphasize other issues, The New York Times' Lizette Alvarez reports. For coverage from the Tampa Bay Times and The Miami Herald, click here.

Could the wildfire spread all the way up to Kentucky?

Gov. Steve Beshear has said he wants to expand Medicaid in Kentucky if the state can afford it, but many Republican lawmakers oppose the idea, saying it would not be fiscally responsible. On the national level, 26 states and the District of Columbia have expressed a desire to expand Medicaid, 17 have said they reject it and seven are undecided, according to the nonpartisan Kaiser Family Foundation.

A more flexibile arrangement could be a game changer because it makes expansion more appealing, especially for states where expanding Medicaid has been politically unpopular and polarizing. in Arkansas, which has a Democratic governor and a Republicna legislature, officials say that from an ideological standpoint, using private insurance appeals to lawmakers from both parties, reports Somashekhar. She reports that even Democratic-led states might prefer this arrangement because it gets rid of some bureaucratic hurdles.

However, there are questions about cost. The Congressional Budget Office estimates that private insurance plans cost $3,000 more per person than Medicaid, reports Somashekhar. On the other hand, Arkansas officials say the move could ultimately save money in administrative charges along with other cost-control measures.

Although the Arkansas proposal is not concrete, it provides proof that the Department for Health and Human Services encourages innovative, state-based approaches to promote expansion. Many states may develop a new route best suited to their specific needs, without having to leave federal money on the table. (Read more)

Dawn Clark Netsch Dies at 86

The grand dame of Illinois politics has died. Dawn Clark Netsch was 86. I had the honor of meeting her on several occasions, usually at fundraisers and luncheons, and each time I would introduce myself to her, she was always gracious. Sometimes I wouldn't say anything, just stand back and watch her as she greeted fans, old friends in her friendly way. For me, she still has one of the best political ads ever -- the straight shooter. Sadly, I couldn't find it in a quick YouTube search, so let me describe it. When she ran for Governor of Illinois in 1994, she ended an ad with her playing pool and making a great shot while someone said "Dawn Clark Netsch, a straight shooter." You can see her holding a cue stick in the photo as she claimed victory after the Democratic primary.  Somehow I'm sure the ad will find its way to the internets today.

I did find that the Chicago History Museum has a 9-part oral history series on her.



She was an inspiration and while I didn't know her personally, I feel a great loss today. Especially as I am headed to a fancy luncheon where a lot of Chicago's power women will be in attendance. It's an event where the chances would had been high Dawn would have appeared. In a state filled with politicians who have broken so many promises and fallen from their pedestals, Dawn would always get a standing ovation anytime she was pointed out in a crowd.

Thanks, Dawn Clark Netsch. May we all serve as graciously as you did.

If Republican governors are agreeing to expand Medicaid after lobbying by hospitals, can Beshear be far behind?

By Al Cross
Kentucky Health News

Florida Gov. Rick Scott's surprising announcement that he would use federal health-care reform money to expand the Medicaid program to households earning up to 138 percent of the poverty level "means the dominoes are falling," says Ron Pollack, executive director of Families USA, a consumer group that lobbied for the law. And another domino seems likely to be Democratic Kentucky Gov. Steve Beshear, without involvement by the state legislature.

Beshear has said he will expand Medicaid if Kentucky can afford it, and has mentioned that the state can reserve the right to pull out of the deal in 2017, when it must start paying a small but increasing share of the cost, reaching 10 percent in 2020. Scott used the same qualification.

Pollack told The New York Times that the message sent by seven Republican governors' acceptance of the deal is  “Even though I may not have supported and even strongly opposed the Affordable Care Act, it would be harmful to the citizens of my state if I didn’t opt into taking these very substantial federal dollars to help people who truly need it.” The GOP governors (of states outlined in Times map below) have said they will expand the program partly to protect rural hospitals and the poor.

"The change of heart for some Republican governors has come after vigorous lobbying by health industry players, particularly hospitals," the Times notes. "Hospital associations around the country signed off on Medicaid cuts under the health care law on the assumption that their losses would be more than offset by new paying customers, including many insured by Medicaid. . . . Every few days, state hospital associations and advocates for poor people issue reports asserting that the economic benefits of expanding Medicaid would outweigh the costs." (Read more)

Kentucky Hospital Association President Michael Rust said the trade group is for "universal coverage" by whatever means but is not lobbying Beshear for Medicaid expansion. "We assume he is" going to expand it, Rust said in an interview today. He said the association has not taken a position on bills that would require legislative approval of expansion and the health-insurance exchange being set up under the reform law. The legislation, Senate Bill 39 and SB40, passed the Republican-controlled Senate on party-line votes today, and are expected to die in the Democratic-majority House.

Senate Majority Floor Leader Damon Thayer said the bills were aimed at reining in "big daddy government." Here's a video from cn|2:

Kentucky Health News is an independent news service of the Institute for Rural Journalism and Community Issues at the University of Kentucky, with support from the Foundation for a Healthy Kentucky.

Bill to shield nursing homes from lawsuits clears Senate along party lines; not looking healthy in House despite TV, radio ads

Last week the state Senate approved on party lines a bill that would make lawsuits against nursing homes go through a review panel first. Republicans supported the bill and Democrats voted against it in a 23-12 vote that marked the clearest partisan split in the Senate in this year's legislative session.

Senate Bill 9 would create medical review panels of three physicians and an attorney moderator to hear complaints against long-term care facilities and vote on whether the suit had enough merit to go to court.  The bill's sponsor, Senate Health and Welfare Chairwoman Julie Denton, R-Louisville, declind to answer an opposign senator's questions about the bill. She said in introducing it that the panel would be advisory but its opinion would be admissible in court and would curb such lawsuits, reports Jack Brammer of the Lexington Herald-Leader.

Bills like this have failed in years past and could have diverse implications for Kentucky communities and nursing homes. At least one Kentucky newspaper looked around and found that lawsuits are one reason Extendicare Health Services Inc. shed management responsibilities last year for all 21 of its facilities in Kentucky, reports Nick Tabor of the Kentucky New Era in Hopkinsville.

Without Extendicare management in Western Kentucky, the volume of nursing-home lawsuits in the region appears to be shrinking, Tabor reports. In recent years, nearly all the Christian County cases that have been closed were dismissed through settlements, not by judges declaring them unfounded. This suggests the bill would minimally affect the county, writes Tabor. Other Kentucky communities may be affected differently; judges differ from circuit to circuit.

Although the bill passed the Senate, it appears to be on its deathbed in the House. Rep. Tom Burch, D-Louisville, who chairs the House Health and Welfare Committee, joked about its prospects to Tabor: “I can’t make any predictions about the bill this time, but I’ve called in three priests to have the last rites ready.” If nursing homes received this new layer of protection, he said, hospitals and day-care centers would want it too.

A similar bill died in Burch's committee last year; this version is being supported by television and radio commercials urging viewers and listeners to call their legislators in support. When Extendicare announced last spring it was transferring management of all its Kentucky facilities to a Texas company, it cited Kentucky’s “worsening litigation environment” and said tort reform seemed unlikely here.

Bernie Vonderheide, director of Kentuckians for Nursing Home Reform, said most so-called “frivolous” lawsuits would cease if the state imposed minimum staffing requirements on nursing homes, his group's main legislative goal. (Read more)

Beshear will expand Medicaid, Democrat and Republican say; D says governor believes the state can opt out if it's not affordable

State legislators in both parties say they expect Gov. Steve Beshear to expand Medicaid to cover several hundred thousand more Kentuckians who earn up to 138 percent of the federal poverty rate.

Rep. Tom Burch, chairman of the House Health and Welfare Committee, told Ryan Alessi of cn|2’s "Pure Politics" that the governor told him exactly that last week. And Sen. Tom Buford, R-Nicholasville, told Kentucky Health News that he expects Beshear to do the deed.

Burch told Alessi that Beshear has decided to move forward with the expansion because he believes the state would be able to opt out if state officials discover that Kentucky can’t afford it after 2017.

Beshear didn’t mention expansion in his State of the Commonwealth Address last week, and the governor’s office said the official decision hadn’t been made yet but didn’t dispute Burch’s statement, Alessi reports. Here is the salient part of his interview with Burch:



Buford said Beshear will be under much political pressure to expand Medicaid because it is President Obama's signature program and expansion will create jobs. However, Republican legislators generally  have opposed the expansion of Medicaid because the state can’t afford it. The federal government will cover the cost of covering the extra people from 2014 through 2016. Kentucky would have to kick in 5 percent of the costs starting in 2017 and 10 percent by 2020.  

The federal government covers roughly 70 percent of Kentucky’s $6 billion Medicaid program. It covers more than 800,000 Kentuckians and with the expansion, that number could grow to more than 1 million — or roughly a quarter of all Kentuckians, reports Alessi.

“I think it’s critical that we take a look at those to see how we achieve that. I’m not sure that this would be the way that would be best-suited to Kentucky and be fiscally responsible for the state of Kentucky,” Sen. Julie Denton, R-Louisville and chairman of the Senate Health and Welfare Committee, told Alessi in December (at 4:10 of the interview below). “Frankly, I don’t think we can afford to do it,” she said.

McConnell helped Amgen delay price limits on dialysis drug

Senate Republican Leader Mitch McConnell of Kentucky, whose public statements usually emphasize the need to cut federal spending on entitlement programs, as they did in Lexington Friday, apparently passed up an opportunity to rein in Medicare spending when he signed off on a big favor for a significant campaign contributor in the fiscal-cliff deal.

The deal delayed for two years price controls on a class of drugs including Sensipar, used by kidney-dialysis patients and manufactured by Amgen, "the world's largest biotechnology firm," Eric Lipton and Kevin Sack of The New York Times reported Jan. 19.

"The news was so welcome that the company’s chief executive quickly relayed it to investment analysts," the Times reported. "But it is projected to cost Medicare up to $500 million over that period. Dennis J. Cotter, who studies the cost and efficacy of dialysis drugs, told the newspaper, “Everybody is carving out their own turf and getting it protected, and we pass the bill on to the taxpayer.”

McConnell spokesman Robert Steurer said the senator did not push for the provision. The Times story did not focus on McConnell, saying "Supporters of the delay, primarily leaders of the Senate Finance Committee who have long benefited from Amgen’s political largess, said it was necessary to allow regulators to prepare properly for the pricing change." And it noted the firm "also has worked hard to build close ties with the Obama administration." It did note that former McConnell chief of staff Hunter Bates is among "a small army of 74 lobbyists for Amgen, which was "the only company to argue aggressively for the delay, according to several Congressional aides of both parties."

According to the Center for Responsive Politics, which analyzes lobbying and campaign contributions, Amgen's political action committee gave McConnell $7,000 during the 2011-12 election cycle, an amount exceeded by only seven other senators, none of them in the Senate leadership. McConnell was the main negotiator on the fiscal-cliff deal with Vice President Biden.

UPDATE, Jan. 25: Writing on BillMoyers.com and then on Salon, Bill Moyers and Michael Winship report that since 2007, "Amgen employees and its political action committee have contributed $73,000 to Senator McConnell’s campaigns," almost $68,000 to Sen. Max Baucus, D-Mont., chairman of the Finance Committee, and $59,000 to Sen. Orrin Hatch, R-Utah. They also note that Republican Rep. Richard Hanna R-N.Y., and Democratic Reps. Peter Welch of Vermont and Jim Cooper of Tennessee have introduced a bill "to repeal the half billion-dollar giveaway to Amgen. The story includes Moyers' video interview with Welch.

Rep. Westrom, bolstered by increasing public support, thinks third time may be the charm to pass a statewide smoking ban law

A coalition of health groups say they will give state Rep. Susan Westrom, D-Lexington, the most public support ever for a bill to ban smoking in Kentucky restaurants and workplaces, a bill she's tried to get passed twice, Jacqueline Pitts of CN2 reports. The coalition, which includes Smoke-Free Kentucky and the American Lung Association, revealed plans yesterday for a two-week ad campaign about the benefits of a statewide smoking ban law.

So far, 24 states have approved smoking bans, and more than 30 Kentucky cities and counties have passed similar local bans. Westrom said that Gov. Steve Beshear, who once said bans should be left to localities to decide, is more supportive of a statewide ban now. A 2012 Foundation for a Healthy Kentucky poll shows that 59 percent of Kentucky adults are in favor of a statewide ban. Westrom said she wants to work with new legislators to get their support for the bill. (Read more)

Republicans moving to gain a say over Beshear's decisions about insurance exchange, Medicaid expansion; Democrat dismissive

Kentucky Senate Health and Welfare Committee Chair Julie Denton, R-Louisville, left, said yesterday that she would file legislation that would block Democratic Gov. Steve Beshear from setting up a health-insurance exchange or expanding Medicaid coverage without legislative approval, Joseph Gerth of The Courier-Journal reports. Beshear has already established an exchange under the federal health reform, but hasn't announced whether he will expand Medicaid.

Denton said the exchanges and Medicaid expansion would be too costly for the state and shouldn't be something Beshear can set up unilaterally. But her effort will likely face opposition in the Democrat-controlled House, Gerth writes. Liberal Rep. Tom Burch, D-Louisville, said Denton "should save the ink that it would take to print the bills," and House Democrats would not receive the bill favorably. Burch has been in the legislature longer than any other current member.

State health-insurance exchanges will allow the uninsured to buy insurance from private companies and perhaps get government subsidies to help pay for it. If Medicaid were expanded in Kentucky, hundreds of thousands of more people would be covered, with the fedreal government paying all the extra cost in 2014-16, decreasing to 90 percent by 2020. Gerth reports that Senate Republicans said they will make it a priority "to rein in Beshear on Medicaid," which they fear would be unsustainable if it were expanded. Denton said requiring legislative approval of these parts of "Obamacare" would give Kentucky citizens a greater voice in the process. (Read more)

Health care is strong second to economy among concerns of Ky. registered voters; candidates compared on handling of issues

Health care ranks high among the concerns of Kentucky voters, according to the latest Kentucky Health Issues Poll taken for the Foundation for a Healthy Kentucky.

The poll, taken Sept. 20 through Oct. 14, asked registered voters to name the two most important issues in the Nov. 6 presidential election. The economy was mentioned by 65 percent; health care was second, with 42 percent. Foreign policy was a distant third, at 21 percent. The error margin on the sample of 1,160 voters is plus or minus 2.88 percentage points.

The poll did not ask voters whom they favored for president, but did ask which candidate they trusted to do a better job on certain issues. Romney, who is considered certain to win Kentucky, had a clear advantage on two issue areas, listed first:

• Dealing with the federal budget deficit: Romney 49%; Obama 36%

• Dealing with the economy and jobs: Romney 48%; Obama 36%

• Dealing with the future of the health reform law: Romney 45%; Obama 40%

• Addressing terrorism: Romney 43%; Obama 42%

• Dealing with the situation in Afghanistan: Romney 42%; Obama 40%

• Improving education: Obama 45%; Romney 40%

• Looking out for the best interests of women: Obama 42%; Romney 40%

• Making decisions about women's reproductive health choices and services: Obama 41%; Romney 38%

"This poll gives us a reliable snapshot of the issues most important to Kentucky voters as they decide who they will vote for on Nov. 6," said Dr. Susan Zepeda, president/CEO of the foundation. "Regardless of the outcomes of the election, our foundation believes it is essential for our elected officials to know what Kentuckians think about these issues." To download the full report by the Institute for Policy Research at the University of Cincinnati, click here.

Obamacare is unpopular in nine swing states, but not when the law is described without that label

Party labels affect what rural voters think about the Patient Protection and Affordable Care Act, according to the latest National Rural Assembly and Center for Rural Strategies poll of rural voters in nine swing states in the presidential election, reports Bill Bishop of the Daily Yonder, which the center publishes.

When asked if they approved or disapproved of the "Affordable Care Act, sometimes called Obamacare," 60 percent of rural voters said they opposed the law, and 34 percent said they favored it. Without reference to "Obamacare," voters were asked if they approved or disapproved of the law, which "would give states the opportunity to extend Medicaid coverage to cover more low income families with health insurance, with the federal government picking up 90 percent of the costs," and 45 percent said they approved, while 42 percent disapproved.

Bishop concludes that partisanship is the culprit for such results. "Partisanship overwhelms issues in today's politics," he writes. "Voters are willing to change their beliefs -- even their religious affiliation ... in order to stay with their political tribe." (Read more)

Doctor complaints about bill aimed at reducing prescription drug abuse largely based on misconceptions, health officials say

State health officials say doctors' complaints about House Bill 1, which cracks down on pill mills and doctors who supply the illegal prescription pill trade, result from misunderstandings and misconceptions about the law's language and intent, Mike Wynn of The Courier-Journal reports. Doctors say the bill's regulations are excessive and restrict their ability to write common prescriptions.

Assistant deputy inspector general Stephanie Hold, of the Cabinet for Health and Family Services, said doctors have at least 19 misconceptions about the state's drug tracking system, Kentucky All Schedule Prescription Electronic Reporting, and said checking KASPER before writing prescriptions "should not impede them in any way," Wynn reports. Mike Rodman, director of the Kentucky Board of Medical Licensure, said there's nothing in the law that prevents doctors from prescribing controlled substances. He said many doctors have for years practiced prescription standards similar to those in the bill, but feel uncomfortable with them being written as law.

The co-chair of the state oversight committee, Democratic Rep. John Tilley, said there are some legitimate concerns about the bill "that need discussion after we can distill what is fact and what is myth," but lawmakers could likely address all of them without changing the statute. (Read more)

Republicans reject governor's executive order creating health benefits exchange; move is only symbolic for now

Republican legislators voted yesterday against Gov. Steve Beshear's executive order creating the Kentucky Health Benefits Exchange, required by federal health reform. Sen. David Givens of Greensburg offered a motion to the legislative Health and Welfare Committee that said Beshear doesn't have authority to create new agencies, but only to rearrange existing agencies with the legislature's approval, Nick Storm of cn|2 Pure Politics reports.

Democrats at the meeting were caught off guard and ultimately walked out after raising objections, Storm reports. They claimed Beshear was following federal law, and said the legislature should consider the matter when it reconvenes in January. Legislators hoped they would get answers from the Cabinet for Health and Family Services about costs and operations of the exchange, which they didn't get at their meeting last month.

The exchange will match up the uninsured with private health insurance companies, and is designed to serve those who make too much to qualify for Medicaid but don't have employer-sponsored insurance. After Democrats left the meeting, Republicans voted to report the committee's findings to the Legislative Research Commission and the governor. The vote remains symbolic unless it is cited in a lawsuit challenging the exchange, which now seems likely. (Read more)

Beshear says he will expand Medicaid if state can afford it, says 'If we've got a healthier Kentucky, we're all better off'

By Al Cross
Kentucky Health News

Gov. Steve Beshear said today that he would expand Kentucky's Medicaid program under the federal health-reform law if the state can afford the cost.

"If there is a way that we can afford that will get more coverage for more Kentuckians, I'm for it, because if we've got a healthier Kentucky, we're all better off. Our economy's better off, and of course the individuals are better off," Beshear told Jack Pattie of WVLK Radio in an interview on Pattie's mid-morning show. (KET image)

That may have been Beshear's first public statement from his own mouth on the issue. State House Republican Leader Jeff Hoover has said Beshear should not expand Medicaid because it would cost the state hundreds of millions of dollars once it has to start paying part of the cost of covering the new patients, beginning in 2017 and rising to 10 percent in 2020.

The first caller to the show asked the Democratic governor, "How much is this going to cost us?"

Beshear did not reply with a number. He said, "We're gonna analyze that part of the law to see how much it will cost us, how many people we're talking about. I do know the profile of the people we're talking about; they're working adults, they're working families that just can't afford health care because they don't make enough money to be able to pay premiums" for health insurance.

Beshear said he would make "a reasoned and fiscally responsible decision, and there is "no timetable on making it at this point." Republicans are expected to make it an issue in the fall elections, raising the prospect of reduced state services or higher taxes.

Pattie asked the governor, "Is it possible to do all this without a tax increase?" Beshear answered, "I've got to look out into the future, see how our revenues are growing, see how our economy is doing, to make sure we don't put a burden on ourselves that we can't afford."

The 2010 law specified that if states did not expand Medicaid to cover those with incomes up to 133 percent of the federal poverty level, they could lose all their federal Medicaid funds, which in Kentucky covers 70 percent of the program's current cost. The U.S. Supreme Court ruled that threat was unconstitutional, giving the states the option.

Several Republican governors have said they would not expand Medicaid, while Democrats are generally in favor of it, but governors of both parties have said they are undecided. It is possible that federal officials would allow the program to be adjusted in ways that would reduce the cost of the expansion.

Beshear also defended his decision to create a state exchange for health insurance, saying the state's business interests, hospitals, insurance companies and other interests wanted the state to run its own exchange rather than let federal officials do it. "We know better about Kentuckians than the federal government does," he said. He told the first caller that the exchange "would not cost us anything," and explained later that insurance companies would pay the cost.

Kentucky Health News is a service of the Institute for Rural Journalism and Community Issues, based in the School of Journalism and Telecommunications at the University of Kentucky, with support from the Foundation for a Healthy Kentucky.

Are fallacies about health reform becoming accepted wisdom? Former New York Times editor Bill Keller says he fears so

"A number of fallacies seem to be congealing into accepted wisdom" about the Patient Protection and Affordable Care Act, former New York Times editor Bill Keller writes for the paper. The myths, he says, are that (1) the law is killing jobs, (2) it's a federal takeover of the health system, (3) the free market would be better, (4) states can fix the problems with health insurance, and (5) the law is a political loser. Here's a capsule of Keller's counterpoints:

(1) Jobs: While some workers "no longer so dependent on employers for their health-care safety net may choose to retire earlier or work part-time," Keller writes, their jobs will be open for others, and he cites FactCheck.org's latest debunking of the job-killer claim.

(2) Takeover: "The main thing the law does is deliver 30 million new customers to the private insurance industry," Keller writes, with emphasis. "Insurance will be governed by new regulations, and supported by new subsidies . . . but the share of health-care spending that comes from the federal government is expected to rise only modestly."

(3) Marketplace: "To the extent there is a profound difference of principle anywhere in this debate, it lies here," Keller writes. He says giving people tax credits to buy their own insurance and care could reduce wasteful spending, but quotes Karen Davis, president of The Commonwealth Fund: Ten percent of the population accounts for 60 percent of the health outlays. They are the very sick, and they are not really in a position to make cost-conscious choices.”

(4) States: "Some states are too poor to adopt worthwhile reforms. Some are intransigent, or held captive by lobbies," Keller writes, noting that the law "underwrites pilot programs to reduce costs, and gives states freedom — some would argue too much freedom — in designing insurance-buying exchanges."

(5) Politics: Because most of the law won't take effect until 2014, "so there are not yet testimonials from enthusiastic, family-next-door beneficiaries. This helps explain why the bill has not won more popular affection. It also explains why the Republicans are so desperate to kill it now, before Americans feel the abundant rewards," Keller writes, calling on Democrats to "mount a full-throated defense." (Read more)

Beshear issues order to create insurance exchange as GOP legislators carry symbolic vote against lease to house it

As Gov. Steve Beshear issued an executive order to establish a state insurance exchange this afternoon, lawmakers voted along party lines against a lease that would have housed employees of the exchange, once again illustrating the divisive nature of the controversial Affordable Care Act.

Members of the Capital Projects and Bond Oversight Committee voted 4-3 against the nearly $300,00-per-year lease, with Sen. Tom Buford of Nicholasville, Sen. Jared Carpenter of Berea, Rep. Steven Rudy of Paducah— all Republicans — voting no, along with Independent Sen. Bob Leeper of Paducah. Leeper caucuses with Senate Republicans.

Rep. Jim Wayne, Sen. Julian Carroll of Frankfort and and Rep. Jim Glenn of Owensboro, all Democrats, voted yes. Discussion focused on the uncertainty of the cost of implementing provisions in the Affordable Care Act and the state budget.

The committee does not have the power to block the lease permanently, but Beshear will have to go through some additional procedural steps.

The exchange is considered one of the cornerstones of the federal health-care reform law aimed at containing costs by spurring competition among private insurers. It will be a marketplace to shop for different packages of state-approved health insurance and will be available to people who earn up to 400 percent of the federal poverty level. To offset the cost of their premiums, those participating in the exchange will receive subsidies in the form of tax credits. The Medicaid program will also fall under the exchange's umbrella. 

Small businesses with fewer than 100 employees can also qualify for the exchange, a move that is meant to boost their purchasing power.

 
Beshear said, "We will work closely with insurers, providers and consumers and other groups to develop a robust, responsive, and user-friendly portal that will help Kentuckians find the coverage that best suits their needs."

He said the exchange will be in operation starting Jan. 1, 2014 as the federal law requires. The state has already received more than $66 million to plan for the exchange. States had the option to run the exchange themselves or have the federal government do so for them. But Audrey Tayse Haynes, secretary for the Cabinet for Health and Family Services, said Kentucky is better geared to running its own program since it "is more in tune with the unique regional and economic needs of our citizens, as well as the health insurance needs of individuals, Kentucky small businesses and nonprofits." (Read more)

Biggest problem with health-care reform law is advocates' poor sales job to the American public, Rep. John Yarmuth tells C-J

By Tara Kaprowy
Kentucky Health News

The biggest problem with the federal health-care reform law is not the law itself, but the fact that "We've never done as good a job as we could have" in explaining what it is about, Democratic U.S. Rep. John Yarmuth of Louisville told the editorial board of The Courier-Journal Friday.

In his lengthy interview, Yarmuth said the problem started at the law's inception when President Obama outlined his parameters but  let Congress decide what the bill should be. "The challenge was explaining what the bill even was because we didn't know what it was going to be," he said.

The issue was compounded by the fact that, unlike energy legislation where its "impact is relatively uniform," with health care "everyone wants to know how it will affect you and your family ... and it's all different," Yarmuth said. "It's hard to market something individually to 300 million people."

Also contributing to the problem is the complexity of the subject itself, which Yarmuth likened to "the biggest Rubik's cube that ever existed," since "Every time you move one piece, 100 pieces move."

That has resulted in deeply-seated misconceptions about the law that are difficult to undo. The biggest, he said, is "that it is some form of government takeover." Those with that view note that the law's individual mandate in the law will force people to buy insurance or pay a fine, and the law will impose new rules on health-insurance companies and put many other controls on the system.

But Yarmuth argues the law uses "free enterprise and competition" to "provide more affordable care for individuals." Indeed, state insurance exchanges will feature different benefits packages from private companies from which people who qualify for the exchange can choose. People who qualify for the exchange — those who earn up to 400 percent of the federal poverty level — will be given subsidies in the form of tax breaks to help pay for their premiums. "The reason why the Republicans don't have an alternative is Obamacare was their alternative," Yarmuth said. "This was their plan: creating competition among insurers and letting them compete for individual business."

Another misconception is that people who don't have health insurance are "deadbeats," Yarmuth said. But he said 37 percent of Americans who are uninsured make over $50,000 a year and almost 20 percent make over $75,000 a year (those percentages are confirmed here). "No, these are solid citizens," he said. He pointed out that all families pay the cost of those who are uninsured, adding that an estimated $1,000 of every health insurance policy goes toward paying for uncompensated care.

Yarmuth said in Kentucky nearly $600 million is spent on uncompensated care each year. (A Kentucky Hospital Association report estimated it is far higher: $1.67 billion in 2010.) Regardless of the figure, Yarmuth said losses could be offset by expanding Medicaid, a claim supported by a report by the Urban Institute. Expansion would cover almost 300,000 Kentuckians and would cost the state $515 million through 2019, he said. "It will bring in $12 billion of federal money," he said. "Is that a good trade-off?"

Asked how provisions in the law would be paid for, Yarmuth acknowledged "If you're adding 30 million more people, it's going to add cost to the system." Ultimately, costs will continue to go up but "less than they otherwise would," he said. He referred to pre-law estimates by the Congressional Budget Office that the cost of employer-based insurance would double to $25,000 a year for a family of four, but the law seems to have slowed that trend. Yarmuth referred to an article published in the journal Health Affairs that indicated that between 2010 and 2011, overall national health-care expenditures increased by 3.9 percent. "That's the lowest rate of growth in the last 50 years," he said. "It is having an effect." The CBO estimated the law will reduce the deficit over the next 10 years by $130 billion, with an estimated $1.2 trillion saved in the second 10, Yarmuth noted. "We all knew we were on an unsustainable path."

But most still don't know that, and on Saturday, a day after the Yarmuth interview, the C-J editorial board criticized Democrats for not doing a better job getting their message out about the new law: "The problem is partially that the law is complex and 2,000 pages long. It's partially that the Republicans have successfully put the Democrats on the defensive, forcing them to defend the law to people who have already had the GOP message driving into their heads. But it's also that the Democrats don't trust that the American people will be willing or able to understand them when they defend the health-care law."

Legislators, doctors debate how health law will or should affect Kentucky; we answer some questions that were left hanging

By Tara Kaprowy and Al Cross
Kentucky Health News

Though host Bill Goodman (above, in an advance promo) said they just "scratched the surface" on what the federal health-care reform law will mean for Kentucky, physicians and legislators debated Medicaid expansion, the implications of requiring people to buy health insurance, how to pay for it all and other questions last night on KET's "Kentucky Tonight" panel and call-in show.

Perhaps the biggest question about the law in Kentucky is whether the state will choose to expand Medicaid, allowing as many as 329,000 more people with incomes up to 138 percent of the federal poverty threshold to qualify for the program for the poor and disabled and be paid for entirely by the federal government in 2014-16. State Rep. Mary Lou Marzian, D-Louisville, pushed hard for the expansion, saying "We can't leave 100 percent of the money laying on the table."

Starting in 2017, the amount of federal contribution will start to decrease — to 95 percent in 2017, 94 percent in 2018, 93 percent in 2019 and 90 percent in 2020 and subsequent years, according to the Henry J. Kaiser Foundation.

Kentucky already has a $400 million shortfall in its budget, said Republican state Sen. Tom Buford of Nicholasville, and would need "$515 to $695 million by 2020" to pay for the additional recipients. Other Republicans have said that would require higher taxes or cuts in services, and called for Gov. Steve Beshear to reject the expansion, but supporters of the law argue that the state will save money overall. For that story, click here.

Louisville urologist Michael Macfarlane, a member of the state Republican executive committee, said he would like to see everyone get health care, but "It really boils down to how are we are going pay for this. . . . In every program like this they underestimate what the future entails. . . . The money is not out there. . . . We are going to be Greece and Spain before long."

Marzian replied, "We are paying now for our uninsured folks that we can put onto Medicaid." Noting that the state has spent hundreds of millions of dollars to help the Kentucky Speedway and the Kentucky Horse Park and build the Yum! Center in Louisville, she asked, "Why can’t we help our middle class and the poorest of the poor get health insurance and health care?" She said the law will stimulate the economy because having more people insured will generate more need for health-care services and health-care jobs.

The panel also debated the implications of the law's requirement to buy health insurance or pay a penalty, which the U.S. Supreme Court upheld as a legitimate use of the taxing power of Congress. Marzian said requiring people to buy health insurance is "personal responsibility" since "everybody uses health care at some point."

Buford, an insurance agent and the chairman of the Senate Banking and Insurance Committee, contended that instead of buying health insurance, those not eligible for Medicaid could just choose to pay the penalty ($695 for individuals or up to 2.5 percent of the household income, the Kaiser Foundation notes) and when hospital care is needed, "She can buy insurance on her way in the ambulance," and after being treated, can cancel the policy.

"That is simply not true," Marzian said. "There is a waiting period." Well, not exactly.

Nicole Huberfeld, a University of Kentucky law professor whom Supreme Court Justice Ruth Bader Ginsburg cited in her opinion, told Kentucky Health News, "The law allows for one three-month grace period of non-coverage per year, so if a person were uncovered, then covered, then uncovered, then covered, penalties would be assessed for the second two non-covered periods." She called that scenario "economically inefficient" since "Most people do not choose to pay something, the tax penalty, for nothing: opting not to have insurance coverage."

In his blog for MoneyTalks News, Stacy Johnson argued that buying health coverage only when it's needed might also backfire: "If you go to the emergency room for a broken leg, will you sit there in agony, applying for insurance and waiting as long as it takes for newly purchased insurance to kick in?"

The liveliest debate on the hour-long show was between the two doctors, Macfarlane and Morehead internist Ewell Scott.

Macfarlane said, "This system really has nothing to do with helping people get health insurance, this system is really going to take over health care . . . directly by computer programs and protocols out of Washington," which he said will ration care and socialize the system. He said a new coding system that will require physicians to select from a vast number of codes — up to 68,000 in the new system from 13,000 in the old one, the American Medical Association indicates — to describe in detail the diagnosis and treatment of each case.

Scott replied, "I think Dr. Macfarlane, with all due respect, is crazy. . . . This is not going to happen." Asked is and how Macfarlane was misstating the facts, Scott said, "This is not going to be a problem for the physician." Macfarlane replied, "That's just not true."

The system in question is the International Classification of Diseases. The ninth version of the system has been in place for 30 years. The transition to ICD-10 will be effective Oct. 1, 2013, according to the Cabinet for Health and Family Services. Despite the increased number of codes, it is not expected to be more time-consuming for providers because "each diagnosis or procedure gets only one code," said Don McLeod, spokesman for the federal Centers for Medicare & Medicaid Services.

Scott acknowledged the law is not perfect and "does nothing to control costs in the long run," but called it "a baby step forward for getting us out of this terrible, dysfunctional health-care financing system we've gotten ourselves into." Scott noted the U.S. has the most expensive health-care system in the world "by double" but has "the worst outcomes in the world." A study by The Commonwealth Fund ranked the U.S. sixth of the seven main industrialized countries in terms of quality.

Macfarlane maintained, "We have the best system in the world." He acknowledged changes are needed, but "The idea that the mandate will pay for this is just false." Large swaths of the population, including young adults, undocumented immigrants and people who are out of work, will continue to avoid buying health insurance, he said. (In fact, undocumented immigrants are exempt from paying the penalty, according to the Kaiser Foundation.)

Goodman ended the show by acknowledging the subject's complexity and the need for more discussion on another episode later this summer or in early fall. To view the show, click here.

Kentucky Health News is a service of the Institute for Rural Journalism and Community Issues, based in the School of Journalism and Telecommunications at the University of Kentucky, with support from the Foundation for a Healthy Kentucky.

Does Obamacare tax the middle class?

U.S. Sen. Mitch McConnell speaks at
a Rotary Club meeting in Louisville.
(C-J photo by Michael Clevenger)

With Senate Republican Leader Mitch McConnell calling the federal health-care reform law a tax on the middle class, Courier-Journal Washington correspondent James R. Carroll collects the findings of independent fact-checking services to assess whether McConnell is accurate.

The Congressional Budget Office estimates that 4 million people would pay the tax or penalty for not being covered by insurance in 2016, which translates to about 1.2 percent of the population. But Glenn Kessler of The Fact Checker at The Washington Post, relying on CBO estimates, reported "that 16 million people will receive subsidies or tax credits to help pay for health coverage — about 5 percent of the population."

"It's worth noting that the health law involves more taxes than just a penalty on the uninsured," Kessler notes, including an excise tax on plans with very high premiums; fees for manufacturers and insurers; higher Medicare payroll taxes for people who make more than $200,000 a year; a tax on manufacturers of medical devices; and a tax on indoor tanning services. All told, "it's a stretch to say that any of these taxes will affect the middle class."

McConnell's assertion that President Obama is raising taxes with the individual mandate is also a double-edged sword: a similar penalty was passed with the health-care overhaul in Massachusetts while Republican presidential nominee Mitt Romney was governor. On that point, McConnell said "Romney will have to speak for himself." Last week, Romney said requiring all Americans to buy health insurance is equivalent to a tax, but that ran counter to how he viewed it earlier in the week.

McConnell told the Louisville Rotary Club last week that repealing the law would be his top priority if Republicans win the presidency in November, reports Chris Kenning for The Courier-Journal. (Read more)

The Lackluster Jobs Report And GOP Sabotage

In the wake of a dismal jobs report, in which "employers created almost enough jobs to keep up with population growth in June, but not nearly enough to reduce the backlog of nearly 13 million unemployed workers," Republicans are doing two things:  Blaming Obama and trying to repeal health care.  As Steve Benen puts it:  "Eliminating health care benefits, as a practical matter, is the GOP jobs plan."

While the tepid job numbers are generally accepted as "absolute, concrete, incontrovertible proof that the president's jobs agenda isn't working," Benen points out, "we aren't trying Obama's jobs agenda."

Perhaps now would be a good time for a reality check. Last fall, Obama said the job market wasn't nearly strong enough, and he proposed an ambitious jobs plan called the American Jobs Act. Independent estimates showed that the policy, if implemented, would create as many as 1.9 million U.S. jobs in 2012 alone. Congressional Republicans, however, killed it.

ThinkProgress has a helpful list of the five key ways Republicans have sabotaged the economic recovery:

1. Filibustering the American Jobs Act. Last October, Senate Republicans killed a jobs bill proposed by President Obama that would have pumped $447 billion into the economy. Multiple economic analysts predicted the bill would add around two million jobs and hailed it as defense against a double-dip recession. The Congressional Budget Office also scored it as a net deficit reducer over ten years, and the American public supported the bill.

2. Stonewalling monetary stimulus. The Federal Reserve can do enormous good for a depressed economy through more aggressive monetary stimulus, and by tolerating a temporarily higher level of inflation. But with everything from Ron Paul’s anti-inflationary crusade to Rick Perry threatening to lynch Chairman Ben Bernanke, Republicans have browbeaten the Fed into not going down this path. Most damagingly, the GOP repeatedly held up President Obama’s nominations to the Federal Reserve Board during the critical months of the recession, leaving the board without the institutional clout it needed to help the economy.

3. Threatening a debt default. Even though the country didn’t actually hit its debt ceiling last summer, the Republican threat to default on the United States’ outstanding obligations was sufficient to spook financial markets and do real damage to the economy.

4. Cutting discretionary spending in the debt ceiling deal. The deal the GOP extracted as the price for avoiding default imposed around $900 billion in cuts over ten years. It included $30.5 billion in discretionary cuts in 2012 alone, costing the country 0.3 percent in economic growth and 323,000 jobs, according to estimates from the Economic Policy Institute. Starting in 2013, the deal will trigger another $1.2 trillion in cuts over ten years.

5. Cutting discretionary spending in the budget deal. While not as cataclysmic as the debt ceiling brinksmanship, Republicans also threatened a shutdown of the government in early 2011 if cuts were not made to that year’s budget. The deal they struck with the White House cut $38 billion from food stamps, health, education, law enforcement, and low-income programs among others, while sparing defense almost entirely.

ACA Is A Law Of Social Change: Cue The Outrage

By Tina Dupuy, cross-posted from her website

We can all stop pretending continued Republican anger about the Affordable Care Act is news. Some figured a Supreme Court ruling would settle things. And since the GOP said it was unconstitutional with the same fervor as people who’ve read the Constitution—it was easy to assume a decision from the nine justices in the highest court in the land—regardless of the outcome—would chill them out.

They would say things like “We are a nation of laws.” Things they say when they agree with the law—however unjust it may be (i.e. immigration).

No instead there are calls for revolt. The perennially reasonable Senator Rand Paul (R-Kentucky) said in a written statement: “Just because a couple people on the Supreme Court declare something to be ‘constitutional’ does not make it so.” And then added, “The whole thing remains unconstitutional.” Which is akin to saying just because something is a law doesn’t make it legal. Or just because they have hair on their face doesn’t make them mammals. The court, not some junior senator from a small state, ultimately decides what is or what is not constitutional. But unconstitutional is the word conservatives use for illegitimate. In chess this move is called flipping the board over and stomping away.

But it also feeds into the right-wing narrative that they are history’s most frequent victims. To them, the more egalitarian the country becomes the more persecuted conservatives are. The sentiment can be traced back to 1845 and the founding of the Know Nothings a nativist group concerned the country was being overrun with German and Irish immigrants. The current tea party finds its sympathies much more inline with the Know Nothings than anyone who ever threw tea in the Boston Harbor. They’re each backlash movements sparked by “change.”

The Know Nothings became split on the issue of slavery and in the southern states morphed into what we identify as the Confederacy. Here you have a region of the country that quite literally fired the first shots of what was to be the bloodiest war in American history and to hear them tell it, it was the “war of Northern aggression.”

The Civil War for many didn’t settle things so why would we assume a 5-4 decision could?

Conservatives are still mad about the New Deal, even though it worked to pull the country out of the Great Depression. They’re still miffed about women suffrage, the Civil Rights bill and Roe v. Wade. In fact any movement forward giving more people more rights and greater acceptance is a point of contention with conservatives. Gay rights is framed as Christians losing their rights to vilify whomever they want. Women not being forced to pay for birth control out-of-pocket is the government restricting the freedom of religion institutions to dictate policy to the government.

Conservatives in the current incarnation of the Republican Party think rights are a zero sum game. If one group gains acceptance, it means another falls out of favor. The cornerstone of trickle down economics is that a rising tide raises all boats—but not when it comes to social change in the right-wing mindset. Then there are winners and there are losers. And conservatives on some level have to lose to prove their preexisting condition: They’re not bullies but martyrs—always hanged in the public square for their belief that only they should benefit from the Bill of Rights.

The Affordable Care Act is a law of social change. It insists on greater equality for women in health care. It stands up for the sick over the bottom line. It’s a step forward for human rights (finally) in our medical system. And it mandates personal responsibility (as with most laws). It’s far from perfect, and as with anything it can stand improvement—but does that make it an affront to Republicans?

In a word: Yes.

It’s health care reform policy, Republicans, going all the way back to Nixon, have touted as a way to avoid socialized medicine in America. So naturally its implementation is a major loss for their team.

Now more Americans can get private medical insurance and insurance companies have to spend a higher percentage of premiums on actual health care—but most importantly conservatives get to be the victims of “a communist plot to kill our freedom.”