Insurers spending seven figures to stop Medicare Advantage cuts

posted at 2:41 pm on January 16, 2014 by Ed Morrissey

Hey, I thought insurers were on board with raiding Medicare Advantage? After all, that’s what ObamaCare does to generate revenue for the ACA’s redistribution scheme. One of the supposedly cost-saving mechanisms within ObamaCare was a series of reductions to insurer reimbursements for their end of Medicare coverage. Suddenly, insurers are finding something about ObamaCare they don’t like:

The ad campaign is part of a lobbying and media blitz by the insurance industry to avoid cuts to their Medicare Advantage payments. The Affordable Care Act cut the Medicare Advantage program by $200 billion. The law and other policy changes cut the program by 6.5% this year.

Insurance officials say the cuts are already forcing insurers to cut their doctor networks, and they warn that further cuts will increase cost and limit access to seniors

“If the Medicare Advantage plan is cut once again, seniors are going to find out in October that their costs are going up, their benefits are being reduced and they have fewer choices of providers and fewer coverage options,” said Robert Zirkelbach, spokesman for the insurance industry trade group America’s Health Insurance Plans.

The ad warns, “We vote,” and that may be the big problem for the Obama administration and Democrats. Whatever cuts take place in reimbursements will get rolled out in October, right before the midterm elections — which the insurers think will help them convince Congress to reverse course:

Insurers believe that timing will help their cause. Most seniors will find out about the new rates during open enrollment in October — only weeks before congressional elections. And insurers are betting that lawmakers won’t want to be explaining to 14 million seniors why their health care costs more or their benefits have decreased.

Well, maybe, but that will take place at the same time that tens of millions of people get kicked out of group plans too, according to HHS’ own analysis of the employer mandate. Seniors, who by and large swing conservative in elections, may be the least of their worries at that point. Democrats and the White House will be more worried about losing younger workers whose small-business health coverage suddenly disappears, forcing them into the already-broken individual markets.

Besides, the Obama White House has a way to deal with the midterm crisis, which is to just unilaterally change the law. It did that with the employer mandate twice — once by postponing it until 2014, and then pushing the date back to mid-November in a fruitless attempt to postpone the consequences until after the election. (Businesses will be making these decisions in August and September, not when open enrollment in the Healthcare.gov exchange begins, something anyone with any experience in the private sector would already know.)  HHS postponed another deadline this week:

The Department of Health and Human Services has pushed back yet another Obamacare deadline, this time extending the life of a federal insurance program that began in 2010 and was only supposed to continue until Dec. 31.

The Pre-Existing Condition Insurance plan (PCIP) was launched in 2010 to provide stopgap coverage for those that needed it until Obamacare officially launched. Health and Human Services (HHS) first pushed the date back to January 31 and announced Tuesday evening that they’ll now extend the coverage until March 31, the final day of Obamacare’s open enrollment period.

Similar to the exchanges, some states run their own versions of the high-risk pool program, while others are part of a federal program. PCIP currently covers less than 30,000 participants between states and federal branches.

“As part of our continuing effort to help smooth consumers’ transition into Marketplace coverage, we are allowing those covered by PCIP additional time to shop for new coverage while they receive the ongoing care and treatment they need,” HHS spokeswoman Erin Shields said in an email Tuesday.

The deadline delay is another tacit admission from the Obama administration that to date, Obamacare exchanges across the country haven’t performed well enough for those who need health insurance.

They’re not just moving deadlines. The White House is also moving goalposts, which has Ron Fournier frustrated — and asking whether the Obama administration will just call whatever happens success:

White House officials consistently—and accurately—argue that the most important metric for Obamacare’s success this year is the mix of young and old enrollees. But they’re backing away from their own goals for that mix.

Getting young people into the system is critical to holding down premiums, and therefore to keeping each state’s insurance market stable. Administration officials previously said their target was for young adults to make up about 38 percent of Obamacare enrollees. Now that standard is down to about 30 percent. Or maybe even 24 percent—where the mix stands now.

The Health and Human Services Department released its first age breakdown on Monday, showing that about 24 percent of Obamacare enrollees are between 18 and 34. Officials from HHS and the White House heralded the figure as a success because it makes an insurance “death spiral”—Obamacare’s worst-case scenario—appear all but impossible

The administration may well hit its initial 38 percent target, but it’s apparently abandoning that goal preemptively, declaring success just by avoiding the worst possible outcome. …

But, once again, administration officials are lowering their own standards for success—ditching targets they set or embraced, and redefining success as anything that’s good enough to avoid a total collapse. It was the White House that set the initial target of 38 percent enrollment for young adults. But officials wouldn’t stand by that figure this week.

Welcome to Hope and Change — changing metrics and deadlines, and hoping no one notices the disaster as it unfolds.


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Hope and Change is something I expected a purple dinosaur to say…

Electrongod on January 16, 2014 at 2:45 PM

and the hits keep coming…do we have any idea if the GOP will really try to get rid of this crap?

DanMan on January 16, 2014 at 2:47 PM

I hope that every single one of them who stood with obama, and the med. devices companies, farmas, doctors…go under, with zero exceptions. They deserve full demise, as does Landrieu and her cohort. To Hades with the entire pack.

Schadenfreude on January 16, 2014 at 2:49 PM

Most seniors will find out about the new rates during open enrollment in October

So we have roughly nine more months to go before Idi Hussein is surprised to read about this in the newspapers???

burrata on January 16, 2014 at 2:52 PM

Ruh roh!

Lanceman on January 16, 2014 at 2:54 PM

Let’s ask libfreeordie what he thinks about this, shall we?

But these Obamacare posts are about whistling past the graveyard, by next Novemeber Democrats will be openly running on the ACA. Mark my words.

libfreeordie on December 20, 2013 at 10:14 AM

Mmmmkay, thanks.

Chris of Rights on January 16, 2014 at 2:55 PM

next Novemeber Democrats will be openly running on the ACA. Mark my words.

libfreeordie on December 20, 2013 at 10:14 AM

Mmmmkay, thanks.

Chris of Rights on January 16, 2014 at 2:55 PM

No, I’m pretty sure libdie said running from. You RWNJs somehow hacked the base and changed his words.

Lanceman on January 16, 2014 at 2:56 PM

Seniors – “We vote.”

Rats – “We count the votes.”

Steve Eggleston on January 16, 2014 at 3:09 PM

All out, to political pasture, with NO exceptions.

Schadenfreude on January 16, 2014 at 3:09 PM

Besides, the Obama White House has a way to deal with the midterm crisis, which is to just unilaterally change the law.

Coming in October,
a new fatwa :
Kids under 40 yrs of age can remain on their parents’ health insurance plans .
Problem solved :D

burrata on January 16, 2014 at 3:11 PM

Encourage this

Schadenfreude on January 16, 2014 at 3:13 PM

It sure looks like Kay Hagan is running from O’Commiecare and Barky as fast as she can. Yet much like a flimsy 1990′s horror movie the monster in the goalie mask preznitial golfing hat keeps at her heels.

viking01 on January 16, 2014 at 3:16 PM

GOP must not allow Dems to out-flank them on this issue, e.g., promising to restore the Medicare Advantage cuts. The Dems must OWN these cuts, which THEY enacted into law to help finance this monstrosity.

That said, the GOP should not truly lift a finger to help the insurers, now or next year. The insurers can go to Hell and take their MA cuts with them. And, if we get the Senate, zero out the risk corridor a year early and tie it to a debt ceiling increase.

The MA cuts themselves will enhance calls for repeal.

matthew8787 on January 16, 2014 at 3:20 PM

Obama’s war on grandma.

VorDaj on January 16, 2014 at 3:24 PM

So the insurers want to have it both ways? Get bailouts from Obama, and keep Medicare Advantage going? Good lueck with that.

Ward Cleaver on January 16, 2014 at 3:35 PM

Seniors – “We voteD FOR OBAMA. TWICE.”

Rats – “We count the votes. Thanks, we love useful idiots.”

Steve Eggleston on January 16, 2014 at 3:09 PM

Fixed for greater clarity. I have absolutely no sympathy for anyone who voted for the usurper, especially those who did so twice. Actions have consequences and honorable people accept consequences for their actions instead of blaming others.

riddick on January 16, 2014 at 3:35 PM

But these Obamacare posts are about whistling past the graveyard, by next Novemeber Democrats will be openly running on the ACA. Mark my words.

libfreeordie on December 20, 2013 at 10:14 AM

It’s right.

There’s no way in hell Obama, Reid or Pelosi will let the negative effects of their signature legislation impact the mid-term election.

They’ll extend deadlines or grant waivers to make sure the shit hits the fan after November 4th.

BacaDog on January 16, 2014 at 3:53 PM

I keep hearing there are cuts, but what are they exactly?

PattyJ on January 16, 2014 at 4:28 PM

Lots of Q Tips driving around with Obama 2012 stickers on their cars. The geezers get what they deserve. Unfortunately, I am also a geezer.

philw1776 on January 16, 2014 at 4:38 PM

Don’t like ObamaCare, even though it’s “the law of the land”? Not to worry! King Barack the Magnificent will CHANGE IT to suit HIS purposes.

And you thought ObamaCare was about YOUR health care!

GarandFan on January 16, 2014 at 4:47 PM

This was not an issue when the insurance companies were playing with the house money. With new legislation promoting the no-bailout policy in Obamacare, they now have a sudden change of heart. Do you ever get that sick feeling in the bottom of your stomach, the one where your at the point of almost throwing up, well this is my America today.

DDay on January 16, 2014 at 4:57 PM

This is what I don’t understand. Republican policy has been to attempt to whither Medicare on the vine essentially since it’s inception.

And Medicare advantage is the biggest scam on that system of all basically. It’s just handing money over to private insurers for basically nothing. Just for being a middle man.

It’s a ridiculous waste an expenditure that is nothing but giveaway money to private insurance companies. It’s a waste of capital.

But you cut it, and suddenly the Republican Party magically becomes the savior of Medicare when the party platform has long LONG opposed it and arguing for cutting it down on so many occasion that’s it’s practically innumerable.

And it’s hypocrisy.

Genuine on January 16, 2014 at 5:56 PM

So of COURSE private insurers want to keep Medicare advantage around, it’s free money!

Genuine on January 16, 2014 at 5:56 PM

This is what I don’t understand. Republican policy has been to attempt to whither Medicare on the vine essentially since it’s Inception.

……………………………………………………………………………………………………………………….

Genuine on January 16, 2014 at 5:56 PM

Really, where did you get attack? Oh, that’s what they used against Gingrich. Do you guys ever add anything to your play book?

whbates on January 16, 2014 at 7:18 PM

So of COURSE private insurers want to keep Medicare advantage around, it’s free money!

Genuine on January 16, 2014 at 5:56 PM

Actually, as it turns out Obamacare will be even more free money to the insurance companies. The problem is that if they continue going along with his schemes they very well might end up in jail when a real Attorney General is put in office. Maybe that’s a risk they aren’t willing to take.

whbates on January 16, 2014 at 7:41 PM

Ed, I hope you’re right.

MN J on January 17, 2014 at 2:23 AM