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Daily Archives: November 7, 2014

Consumer Guide To The Supreme Court’s Action On ACA Subsidy Issue

The Supreme Court on Friday agreed to hear a case on a subject that’s important to millions of people who receive subsidies to help purchase coverage under the health-care law. Friday’s decision follows earlier action in July when two U.S. appeals courts issued conflicting rulings on the issue.  KHN’s Mary Agnes Carey answers some frequently asked questions about those court decisions and how they impact consumers.

Q: What did the Supreme Court do?

brown gavelThe justices decided to hear a case that challenges the federal government’s ability to provide subsidies to individuals in nearly three dozen states where the federal government operates the online marketplaces, or exchanges. There are several legal challenges on this issue that are working their way through the courts. The high court’s decision to accept the case surprised many analysts who thought the Supreme Court might wait until they had a ruling from the full District of Columbia Court of Appeals, one of the other courts considering the issue.

Q:  How did the lower courts rule on the subsidy issue?

A three-judge panel from the U.S. Court of Appeals for the District of Columbia Circuit ruled in July that the health law’s subsidies are available only to individuals in states now operating their own health insurance exchanges. In 2014, only 14 states and the District of Columbia ran their own exchanges, while 36 relied on the federal government. Judge Thomas Griffith, writing the majority opinion in the 2-1 decision, said they concluded “that the ACA unambiguously restricts” the subsidies to “exchanges ‘established by the state.’” That ruling was later vacated when the full District of Columbia Court of Appeals agreed to rehear the case, which is scheduled for December next month.

This KHN story can be republished for free (details).

In a separate ruling, a three-judge panel for the Fourth Circuit Court of Appeals in Richmond, Va., ruled unanimously for the Obama administration, allowing subsidies to be available to residents in all states.  Judge Roger Gregory, writing the opinion, said while the health law is “ambiguous and subject to multiple interpretations,” the court decided to uphold the IRS’s interpretation of the law that residents of states using the federal exchange are entitled to subsidies. That Virginia case, King v. Burwell, is the case the Supreme Court said would hear this term.

Q: What was the issue the lower courts decided on?
The case centers on a brief description in the health law that says subsidies will be available “through an exchange established by the state.”

Related

More on this issue

In Surprise Move, Supreme Court Will Examine Key Part Of Health Law

In implementing the law, the Internal Revenue Service (IRS) interpreted the law to allow eligible consumers to receive subsidies to help purchase coverage, regardless of whether they are in an exchange run by their state or by the federal government.

Opponents of the law questioned that interpretation, saying that the law as written clearly directs subsidies to state-based exchanges only.  But proponents – including several lawmakers who helped write it – said lawmakers fully intended that subsidies be offered on all exchanges no matter if they were administered by the feds or state officials.

Q: I live in a state with a federally run exchange, and I get a subsidy to help me buy coverage. Am I going to lose it?

Current subsidies will likely remain in place until there is a final legal decision on the matter.

White House spokesman Josh Earnest said the administration was confident it would prevail. “The ACA is working. These lawsuits won’t stand in the way of the Affordable Care Act and the millions of Americans who can now afford health insurance because of it,” Earnest said in a statement Friday. “We are confident that the financial help afforded millions of Americans was the intent of the law and it is working as Congress designed.” Open enrollment begins again Nov. 15.

Supporters of the court challenge to the IRS interpretation on subsidies also maintain their case is strong. “The Supreme Court’s decision is a rebuke to the Obama administration and its defenders, who dismissed as frivolous the plaintiffs’ efforts to defend their right not to be taxed without congressional authorization,” Michael Cannon, director of health policy studies at the libertarian Cato Institute who championed the subsidy appeals, said in a statement Friday. “It is essential that these cases receive expedited resolution, if only to eliminate the uncertainty currently facing states, employers, insurers, and taxpayers.”

Q: If there are legal disputes ongoing about who qualifies to receive a subsidy, do I still have to buy health insurance?

Yes.  The law’s “individual mandate,” which requires most people to purchase health insurance or pay a fine, is still in place and has been upheld by the Supreme Court.

Q. What if I get my insurance through work?
This decision applies only to policies sold on the online marketplaces. It does not affect work-based insurance, Medicare or Medicaid, regardless of where you live.

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In Surprising Move, Supreme Court Will Examine Key Part Of Health Law

Once again, the Supreme Court will decide whether the Affordable Care Act lives or dies.

Defying expectations, the court announced Friday it has agreed to hear – during this term –  a case that challenges the heart of the law: subsidies to help people pay their insurance premiums. In about three dozen states, the federal government runs the online marketplaces where individuals can find health plans.

At issue is a phrase in the law stipulating that subsidies to help those with incomes under 400 percent of poverty are available only in “exchanges established by a state.” The authors of the law argue that the rest of the statute makes it clear that subsidies are available not only in state-run exchanges, but in those where the federal government is doing the work of the state.

This KHN story can be republished for free (details).

When the law was written, most people expected that states would want to run their own exchanges. It was a surprise when most opted to let the federal government do it instead.

A decision to strike down the subsidies in federally-run exchange states could end up making insurance unaffordable for millions of people and threaten the viability of the law’s entire health insurance program.

In a rare Friday afternoon notice following their closed-door conference, the justices noted with no further comment that they have agreed to hear King v. Burwell. That is the case in which a three-judge Appeals Court panel in Richmond ruled unanimously that Congress did intend to allow subsidies to be available nationwide.

The Supreme Court will again rule on a key part of the Affordable Care Act.

The Supreme Court will again rule on a key part of the Affordable Care Act.

That same day, a panel  in the District of Columbia Court of Appeals ruledł-1 the opposite way. But that case, Halbig v. Burwell, was vacated when the full court agreed to rehear the case. That is scheduled for December.  Because there are not yet contradictory decisions by appeals courts, most observers thought the Supreme Court would at least wait until the lower courts were finished considering the case before weighing in.

“We are disappointed that at least four Justices decided to hear this case despite the lack of a circuit split and while this issue is still being actively litigated in the lower courts,” said Doug Kendall of the Constitutional Accountability Center, which is representing the members of Congress who wrote the law. “But we remain very confident that the Court will ultimately find that both the text of the ACA and the intentions of Congress mandate a ruling for the federal government.”

Those who argue that the federal subsidies are illegal, however, say time is of the essence.

“In King there is a serious argument that it would be better to resolve the underlying question of statutory interpretation sooner rather than later,” wrote Jonathan Adler, a law professor at Case Western University, in The Washington Post last week. “The resolution of this litigation will alter the calculus for many political and private actors considering how to respond to the PPACA, and the statute contains various deadlines and timeframes that may become harder to navigate the longer this litigation drags on.”

The White House said in a statement that the lawsuits challenging the language would not stand in the way of the law’s implementation. “This lawsuit reflects just another partisan attempt to undermine the Affordable Care Act and to strip millions of American families of tax credits that Congress intended for them to have,” the White House statement said.

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Missouri Primary Care Doctors Face Substantial Medicaid Cut

Justin Puckett, an osteopathic physician from Kirksville, Mo., will have a major decision to make at the start of 2015 — whether his family medicine practice can continue to treat Medicaid patients.

Looming over Puckett and other primary care doctors is a cut to their reimbursement rate that is set to take effect at the end of this year, barring action from a lameduck Congress reeling from Tuesday’s Republican electoral wave.

“We are still crossing our fingers,” he said.

Under President Barack Obama’s health care overhaul, primary care doctors across the country were paid more for treating Medicaid patients during the last two years. But that boost is set to expire, leaving some providers and their patients in a tough spot.

This copyrighted story comes from the St. Louis Post- Dispatch, produced in partnership with KHN. All rights reserved.

“It would basically be a door-closer,” said Keith Ratcliff, a physician from Washington, Mo.

Before the Affordable Care Act raised the Medicaid reimbursement rate in all states, Missouri doctors treating those patients got roughly half the amount of pay they would have received if those clients were covered by Medicare.

Rates can vary based on the type of care that was provided and many states already paid their primary care doctors at rate comparable to those paid by Medicare.

The payment disparity in Missouri between the two government-funded health insurance programs caused many doctors to limit the number of Medicaid patients they would treat, restricting access to the mostly low-income beneficiaries of the program.

For example, doctors would be reimbursed $54.74 by Medicaid for an office visit requiring a detailed exam and medical history before the rate boost took effect. During the last two years of higher rates, the same doctor would be reimbursed $105.16 for providing the same care.

As part of an expansion of Medicaid coverage authorized under Obama’s health law, the reimbursement rates were temporarily lifted in an effort to get more doctors to accept those patients.

“It was imperative that the people caring for these patients be reimbursed at a rate where it didn’t cost them money to see patients,” said Brian Bowles, the executive director of the Missouri Association of Osteopathic Physicians and Surgeons.

About 3,200 physicians are designated as general practitioners for the Missouri Medicaid program. It’s unclear how many providers expanded their Medicaid services because of the higher rates. The Centers for Medicare and Medicaid Services isn’t collecting data.

But those doctors who did take on additional patients are looking for relief and making some tough decisions.

LOOKING TO THE LEGISLATURES

Doctors are holding out hope that Congress will vote to extend the higher reimbursement rate for primary care physicians across the country.

Legislation is pending in both the House and Senate, and physician groups were hopeful a deal could be cut after Tuesday’s midterm elections. But Tuesday’s decisive victory for Republicans, giving them their first Senate majority since 2006, tempered those expectations.

The GOP has been resistant to making changes or fixes to the Affordable Care Act in the hope of being able to fully repeal the law.

In the absence of congressional action, states could decide to foot the bill for the higher reimbursement rates themselves, and at least 15 have already agreed to do so, in full or in part.

But Missouri isn’t one of them.

In his budget request for the current fiscal year, Democratic Gov. Jay Nixon asked lawmakers to use state funds to continue the higher rates. The state’s share of the cost would have been about $20 million for the year, according to state budget officials.

The Republican-led Legislature agreed to continue the rate boost, but only partly. It approved $4 million in additional spending.

That money, however, ended up being vetoed by Nixon as part of a showdown with Republicans over tax breaks for certain industries and declining state revenue.

“It’s very difficult operating a business where we provide such an important human service and yet at the same time all of our income is essentially controlled by a third party we don’t have any influence on,” Puckett said.

PREPARING TO GO WITHOUT

Now doctors face some difficult choices that will affect how the roughly 800,000 Missourians on Medicaid receive care.

Puckett said his practice is considering limiting the number of Medicaid patients it will see or laying off staff. About 30 percent of this patients at his center, Complete Family Medicine, are covered by Medicaid. The others have private insurance, Medicare or pay with cash.

He said the lower rates will force him to decide between restricting Medicaid recipients or cutting services for all his patients.

“It’s an ethical decision, not just a business decision,” he said.

Ratcliff said that if doctors cannot absorb the hit, then patients would seek more care in emergency rooms or have to travel for miles to see a doctor. He said federally qualified or rural health centers may have to pick up some of the slack. Those types of clinics are reimbursed differently for their care.

“Those are the only practices that may survive out in the more rural areas,” he said.

Heidi Miller, a doctor at the Family Care Health Centers in St. Louis (a federally qualified health center), said the lower reimbursement rates were unlikely to affect access to care in the state’s urban areas because many private primary care providers don’t see Medicaid patients anyway.

“I’ve had a number of new patients over the last dozen years who came to us because their private doctor was not able to see them due to a change in their insurance coverage,” she said. “It’s extremely hard to get a private doctor to take Medicaid.”

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High Court To Hear Challenge To Health Law Subsidies

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ALS Patients Win Fight Over Medicare Reimbursement For Speech Devices

After strong pushback from ALS patients and lawmakers, the government has reversed a decision that could have blocked Medicare reimbursement for certain speech generation devices beginning Dec. 1.

The decision announced Thursday by the Centers for Medicare & Medicaid Services means Medicare will continue a longstanding policy to cover most of the cost of devices that can be upgraded by patients at their own expense.

Speech generation equipment is critically important to patients with ALS and similar neurodegenerative disorders – conditions that limit their capacity for movement and speech. Patients, since񎧑, have had the option of paying themselves for upgrades, including those that enable them to connect to the Internet and open doors or adjust room temperatures. But in February, Medicare announced a policy interpretation that would have precluded coverage of the cost of upgradable devices.

Patients with ALS, amyotrophic lateral sclerosis, and their advocates strongly objected. On Thursday, the government backed off.

In reversing course, CMS “emphasized the importance of technology and how critical it really is, at this point, I think, to not make a new policy immediately,” said Kathleen Holt, associate director at the Center for Medicare Advocacy, which advocates for Medicare beneficiaries.

Advocates are still worried about the future. Medicare intends to update its National Coverage Determination – the federal rule that determines what Medicare can cover – so as to incorporate technological advances that weren’t around in 2001. Public comment will be solicited, and a revised rule is likely by July 2015, said Patrick Wildman, director of public policy at the ALS Association.

This KHN story can be republished for free (details).

That means “there’s still the uncertainty of what is the coverage policy going to look like, come July 2015,” Wildman said. “Will it be something different?”

“One of the things I would say to beneficiaries is, we’ve got a temporary reprieve on this, but don’t stop fighting,” Holt said.

CMS did not immediately respond to requests for comment.

ALS patients had aggressive support from Congress on the question of speech generating devices. Some  200 members signed a bipartisan “Dear Colleague” letter in September, asking CMS to respond to patients’ concerns. On Tuesday, Rep. Tim Murphy, R-Pa., sent the agency another letter.

The letters also expressed concern about a recent pattern of Medicare denials of coverage of eye-tracking technology, which uses eye movements to generate commands for the speech devices. Those claim denials are routinely reversed on appeal, but the appeals process can take months.

This article was produced by Kaiser Health News with support from The SCAN Foundation.

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Viewpoints: GOP’s Doomed Vow On Health Law; ‘Scary Sign’ On Obamacare From Supreme Court

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Research Roundup: ‘Pharmacy Deserts'; Marketplace Premiums; Narrow Networks

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State Highlights: Mass.’s Quincy Hospital To Close; N.M. Human Services Secretary Resigns

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Docs’ Groups Eye Lame Duck Session For SGR Overhaul

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Humana Says Health Law, Hepatitis C Drug Costs Hurt Profit

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