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Trump's Executive Order on Healthcare is Bad Medicine

With all the skill of a surgeon wielding a machete, President Trump signed an executive order today that could undermine the affordability and quality of health insurance in America.  Republicans in Congress couldn’t enact their ill-considered legislation to repeal Obamacare, so the President hastily reached for his pen, despite admitting earlier this year that he had no idea “healthcare could be so complicated.”

The executive order instructs Trump’s cabinet agencies to look at ways to allow insurers to sell health policies across state lines.  The aim is to open-up association health plans (currently covering employees of various businesses and organizations) to people in the individual market.  These insurance policies would not be subject to Obamacare rules mandating coverage for pre-existing conditions or essential benefits, in theory making them cheaper – but also skimpier.  

These lower-cost, bare bones plans could siphon off younger and healthier enrollees, leaving older and sicker patients in the Obamacare exchanges and driving up their premiums. Ultimately, this could result in a death spiral for Obamacare, as we discussed on today’s Behind the Headlines Facebook Live broadcast. The administration’s own Centers for Medicare and Medicaid Services (CMS) says on its website:

Older Americans between ages 55 and 64 are at particular risk: 48 to 86 percent of people in that age bracket have some type of pre-existing condition. 

To some, the idea of selling insurance across state lines sounds appealing. (Republicans have been proposing this scheme in one form or another since 2005.)  Senator Rand Paul (R-KY) has been pushing it hard this year. But evidence – and history – indicate that the idea doesn’t work.  This Kaiser Health News video briefly and crisply explains why.

Not only does the selling-across-state-lines concept undermine important patient protections and drive up premiums for the most vulnerable, it has never proven viable for insurers or the insured.  According to today’s Hill newspaper:

A few states have opened their borders to out-of-state health insurers, and the response has been a uniform, “Thanks, but no thanks.”

One of Obamacare’s architects, Dr. Zeke Emanuel, told CNN today that, in addition to other concerns, association health plans have a “checkered history” and are especially vulnerable to fraud and scam artists. “Hundreds of thousands of people could be affected by fraud, unreimbursed medical bills,” he warned.  Emanuel also cautioned that patients with employer-provided insurance could see their rates rise “significantly.”

The biggest problem of all, though, is that Trump’s executive order may well be illegal.  The New York Times reports:

Several experts in healthcare and employment law said Trump’s plan could violate the U.S. Employee Retirement Income Security Act (ERISA), a federal law that governs large group plans that must be provided or maintained by employers or employee organizations.

In fact, a coterie of Democratic states attorneys general are poised to sue the administration if it enacts these harmful changes.

For all the Republicans’ talk of federalism, the executive order would actually weaken states’ power to regulate insurance markets, which is one of their primary responsibilities in the health care arena.

But as with the President’s trickle-down tax plan and other haphazard policies, history, precedent and data don’t seem to matter to this White House.  That’s especially troubling when – once again – the most vulnerable members of society will pay the price.


GOP Tax Cuts Could Cost Seniors in the Long Run

The GOP had scarcely emerged from the defeat of their latest Obamacare repeal legislation when they pivoted lightning-quick from healthcare to taxes.  The tax reform plan the party unveiled last week may ultimately endanger the well-being of older Americans more than the vanquished healthcare bill.  Here’s why:  The nonprofit Tax Policy Center estimates that the GOP tax plan will reduce federal revenues by a net $2.4 trillion in the next 10 years.  As the deficit grows, Congress will look to cut spending.  Republicans have already called for deep cuts to Social Security and Medicare, and would no doubt come after those programs looking for massive savings. Seniors’ earned benefits could be used as piggy banks to pay for reckless tax cuts that largely benefit the wealthy.

Americans for Tax Fairness put it his way:

"[The tax plan’s] eye-popping cost will lead to deep cuts in Social Security, Medicaid, Medicare, and public education that will leave working families in the cold."- Americans for Tax Fairness

… while House Democratic leader Nancy Pelosi predicted:

“Make no mistake: after Republicans’ tax plan blows a multi-trillion dollar hole in the deficit, they will sharpen their knives for Social Security, Medicare, Medicaid.” – House Minority Leader Nancy Pelosi 

Budget hawks (including President Trump’s budget director Mick Mulvaney and House Speaker Paul Ryan) have long dreamed of cutting Social Security and Medicare.  Once their tax plan balloons the deficit, they will have the perfect excuse for gutting those programs – even though Social Security and Medicare Part A are completely self-funded by workers’ payroll contributions; they contribute not a penny to the deficit.

In fact, the budget cutters’ knives are already sharpened. The 2018 House Budget resolution calls for nearly $500 billion in cuts to Medicaid over the next decade.  That would be devastating for the 1.4 million seniors who rely on Medicaid for long-term care, and millions of others who are dually eligible for Medicaid and Medicare.  The House budget resolution also includes nearly $500 billion in cuts to Medicare over the next ten years.  Under the House budget plan, Medicare would be privatized and the eligibility age raised from 65 to 67 (an effective benefit cut). If these changes are enacted, seniors will be left to fend for themselves in the private insurance market with vouchers that may not keep up with rising costs. 

Despite President Trump’s protestations that the GOP tax plan won’t benefit the rich, that’s precisely who would reap the biggest gains.  (Trump himself could save an estimated $1 billion in taxes!)  According to the Tax Policy Center’s analysis:

"Taxpayers in the top 1 percent would receive about 50 percent of the total tax benefit from the tax overhaul, with their after-tax income forecast to increase an average of 8.5 percent." – Tax Policy Center 

On the other hand, some in the middle class would see their taxes go up.  One in seven households earning between $48,000 and $86,000 per year would pay more in taxes next year; the proportion would double during the next decade.  For households earning $150,000-217,000 a year, one third would immediately pay more in taxes. 

Republicans claim that the tax cuts will pay for themselves through intense economic growth.  They have tried this before (Most recently, with the Bush tax cuts in the early 2000s), and it didn’t work out.  Instead, deficits swelled, reinforcing budget hawks’ instincts to cut programs for the most vulnerable members of our society, including and especially seniors.  One of the (repentant) architects of the failed trickle-down economics of the 1980s, Bruce Bartlett, put it best in a recent column for USA Today: 

"Tax cuts and tax rate reductions will not pay for themselves; they never have. Republicans don’t even believe they will, they are just excuses to slash spending for the poor when revenues collapse and deficits rise." – Bruce Bartlett, former Congressional economist

 

 

Throwing More Money at Wavering Senators’ States Doesn’t Improve Graham-Cassidy

To paraphrase W.C. Fields, it seems as if news of the death of the Graham-Cassidy bill is greatly exaggerated.  As veteran Kaiser Health News correspondent Julie Rovner tweeted this morning:

FWIW I will not believe health bill is really dead until I see it with an actual stake through it.

Her caution is well warranted.  Anti-repeal advocates breathed a sigh of relief last Friday when Senator John McCain (R-AZ) announced his opposition to the bill.  But opponents of Graham-Cassidy still need one more GOP vote to kill it before the September 30th deadline, and so far only McCain and Senator Rand Paul (R-KY) have announced as ‘No’s.  Some Hill-watchers are wary of Rand Paul’s position and predict he will flip to ‘Yes’ at the last minute, as he has done previously.  On the other hand, this weekend Sen. Ted Cruz (R-TX) threw cold water on Graham-Cassidy because he says it doesn’t go far enough in undoing Obamacare regulations:

"Right now they don't have my vote, and I don't think they have Mike Lee's either," Cruz said. "I want to be a yes."              –  Senator Ted Cruz

Seeing their Obamacare repeal bill appear to collapse before their eyes, Senators Lindsay Graham (R-SC) and Bill Cassidy (R-LA) have now sweetened the deal to try to buy off two wavering moderate Senators, Lisa Murkowski (R-AK) and Susan Collins (R-ME).   The Graham-Cassidy bill was changed over the weekend to give away tens of millions of dollars to two of America’s least populous states.  Alaska would net $3 million more in federal health spending than under current law from 2020-2026, and Maine $43 million.  Of course, when Graham-Cassidy’s block grants to states expire in 2026, both states will lose funding along with the other 48.   Steven Dennis of Bloomberg handicaps it this way:


These buy-offs may or may not bring Senators Murkowski and Collins over to the ‘Yes’ side.  Nor should they.  Both Senators have expressed deep concerns about other parts of the bill:  Sen. Murkowski for its elimination of protections for pre-existing conditions; Sen. Collins for its deep cuts to Medicaid.  And of course, these bribes for Alaska and Maine do not make the Graham-Cassidy bill any less egregious.  Every major group of stakeholders – insurers, doctors, hospitals, patients, and all 50 state Medicaid directors – have condemned this bill as a reckless assault on America’s health care system.  National Committee president Max Richtman lays out the case in testimony given to the Senate Finance Committee. 

The Republicans supporting Graham-Cassidy don’t seem to care as much about improving healthcare as they do about fulfilling a reckless campaign promise and scoring a legislative “win,” even though the vast majority of the American people would actually lose.  Premium subsidies would be eliminated, pre-existing conditions no longer protected, essential benefits gutted, and Medicaid decimated to the point where crucial services would be cut for seniors, children and the disabled.  One look at this chart from Kaiser Health News showing where most Medicaid spending goes makes it crystal clear who gets hurt if Graham-Cassidy becomes law.

Senators Graham and Cassidy, along with their enablers in the Trump administration, will continue to falsely claim that their bill protects people with pre-existing conditions, when by leaving it to the states to decide, there is no such protection at all.  If states seek waivers to pre-existing conditions, insurers can jack up rates for patients with diabetes, cancer, heart disease and other chronic illnesses to the point of unaffordability.

Instead of believing more pablum, or trusting that the Republican-led Senate will do the right thing, we must keep up the pressure on wavering Senators (especially Collins and Murkwoski) to vote ‘No’ when the bill comes to the floor later this week.  If we are to see a stake through Obamacare repeal, we must make sure to put it there ourselves. 

Remembering a Crusader for Equal Access to Federal Benefits

The woman President Obama called one of America’s “quiet heroes” passed away September 12th in New York City.  Edith Windsor, 88, was a champion of LGBT rights, whose victory in the landmark United States v. Windsor Supreme Court case allowed married same-sex couples to collect the same federal benefits as heterosexual couples in states that had legalized gay marriage. 

Edith Windsor’s 2013 victory inspired Kathy Murphy, a Texas widow who was denied Social Security survivor’s benefits after the death of her wife, Sara. With the help of the Lambda Legal Defense Fund, Murphy, a member of the National Committee to Preserve Social Security and Medicare, sued the Social Security Administration (SSA) in 2014 for the right to collect survivor’s benefits.  Murphy’s case was later folded into the Obergefell v. Hodges Supreme Court case that legalized same sex marriage and access to spousal benefits for same-sex couples nationwide in 2015.  

Thanks to Edith Windsor, Kathy Murphy, and millions of supporters across the country, same-sex couples became eligible for the full range of Social Security spousal benefits, including retirement, survivor, death and disability protections. This led to the development of a National Committee sponsored community outreach and education initiative called Know Your Rights which helped thousands of LGBT couples and families understand their Social Security benefits.  

Edith Windsor lived with her partner, Thea Spyer, for 40 years, finally getting married in Toronto in 2007. (Their home state of New York didn’t legalize same-sex marriage until 2011).  Windsor was denied an estate tax exemption for married couples after Spyer died, and sued the federal government for a tax refund, leading to the landmark Windsor decision.  

The diminutive Windsor, a retired computer programmer for IBM, never sought the spotlight but embraced her role as a well-known LGBT activist. 

The National Committee celebrates Windsor’s life and her landmark achievements.  She was that ‘ordinary person’ caught up in extraordinary circumstances who bravely stepped forward for the cause of equality, the “quiet hero” who gave voice to couples asking only the same benefits as everyone else.

Rep. Brat at His Worst: Spreading Myths about Social Security and Medicare

In a contentious interview with CNN’s Kate Bolduan this week, Rep. Dave Brat (R-VA) perpetuated some dangerous myths about Social Security and Medicare.  Brat, a Tea Partier and fiscal bomb thrower, has been campaigning to cut seniors’ earned benefits since first running for Congress in 2014.

The CNN interview heated up when Bolduan pressed Brat about the recently-passed deal to suspend the debt ceiling and keep the government open, which he opposed.  It’s worth quoting Brat’s answer at length here, because it is only borderline comprehensible and riddled with inaccuracies:

“I was just at my convocations back home with the kids. The kindergarteners are in the class of 2030, they just told me. They will graduate college in 2034. So if you do know the context, the context is that is the year Medicare and Social Security are insolvent. I don’t think people do know the context.  Otherwise there’d be more urgency and they wouldn’t put up with the nonsense we’re doing up here on the fiscal front. Right? If the press would weigh in on what the damage -- it’s a guaranteed fiscal crisis in 2034. Guaranteed.  In law, I’m on the budget committee, we can’t touch it.  Right--You got to pass in law.  So that’s – that’s the context and so with that; if you ask the average voter how you should vote on a clean debt ceiling increase with no fiscal discipline whatsoever, it’s the whole country 90%.”

Where to begin dissecting this statement?  The relevance of kindergarteners graduating college in 2034 notwithstanding, Social Security and Medicare will not be insolvent that year.  If Congress takes no corrective action whatsoever, the Medicare Part A Trust Fund and the Social Security Trust Funds will be depleted in 2029 and 2034, respectively.  But that does not mean the programs will be insolvent.  Revenue from workers’ payroll taxes still will be flowing in, allowing Medicare to pay 88% of full benefits and Social Security 77% --- with no further action from Washington.  In fact, the 2017 Social Security Trustees Report says there is now $2.847 trillion in the Social Security Trust Fund, which is $35.2 billion more than last year --- and that it will continue to grow with payroll contributions and interest on the Trust Fund's assets.)  

Does this mean we sit by and do nothing?  Of course not.  But Rep. Brat’s prescriptions are as draconian as his statements are inaccurate.  The Congressman has championed cutting Social Security and Medicare and raising eligibility ages as the only solution.  When running for office in 2014, he told a Tea Party crowd:

“It’s not just little marginal changes, right?  In order to avoid those insolvency issues with Medicare and Social Security, you’re going to have to do some major cuts."

According to PolitiFact, Brat went on to say that people will ‘have to work longer before receiving benefits’ – meaning raising the retirement age.  This favorite proposal of fiscal hardliners is actually a benefit cut.  And it is based on the misconception that just because average life expectancy is rising, everyone can work well past 65 – even though working class Americans (especially those doing physical labor on the job) may not be physically able to continue working into their late 60s like their wealthier counterparts.

Hardliners don’t like to talk about this, but there are other ways to keep our earned benefits fiscally sound without punishing the people who depend on them. The National Committee supports legislation by Senator Bernie Sanders (I-VT), Rep. John Larson (D-CT), and others in Congress to keep Social Security solvent without cutting benefits or raising the retirement age – mainly by lifting the payroll tax income cap so that the wealthy pay their fair share.  In fact, the Sanders and Larson bills actually boost benefits and cost-of-living increases while ensuring the fiscal health of Social Security well past those kindergartners’ 2034 graduation date. That way, those kids can count on their benefits when they retire around 2077.

But some members of Congress – and Rep. Brat in particular - ignore or dismiss these modest and manageable solutions, proposing instead that seniors shoulder the burden through benefit cuts and a higher retirement age.

Now we come to the second myth that Brat likes to propagate:  that Social Security and Medicare are major drivers of the federal budget deficit.  At that same 2014 Tea Party campaign event, Brat justified Social Security and Medicare cuts by saying:

“We’re going to have to take some bad medicine… to just balance the budget. If you don’t solve it, then in 11 years nearly all federal revenue will go only to [Social Security and Medicare].”

The fact is that Social Security has no net effect on the federal budget and contributes not one penny to the deficit. It is self-financed through workers’ payroll taxes.  Ditto for Medicare Part A.  Suggesting that these programs must be cut to balance the budget is disingenuous at best, but that doesn’t stop fiscal hardliners and the mainstream media from spreading the myth.  

Notice how Brat conflates the debt crisis with Social Security and Medicare at the end of his CNN rant.  Unfortunately, this claim is made far too often, but is hardly ever challenged by on-air journalists, this time being no exception (though, in truth, Bolduan was struggling just to control the interview).

Why do the on-air rantings of Congressman Brat matter? His arch-conservative philosophy wouldn’t be so dangerous if he were truly on the margins of political debate. But for the first time in more than a decade, fiscal hawks have the power to impose their hardline views on America’s most vulnerable citizens. Brat is a member of the House Budget Committee, which has already voted to privatize Medicare and raise the eligibility age.  That’s a powerful perch for spreading myths about Social Security and Medicare in order to justify cuts that are just plain cruel. 




   

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