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The GOP’s $4.5 Billion Hidden Tax On Businesses

One of the most underreported provisions of the House Republican budget — one which House Budget Committee Chairman Paul Ryan (R-WI) himself routinely eschewed during his town halls across Wisconsin — is the fact that the plan gradually raises the Medicare eligibility age to 67 beginning in 2022. Ryan wasn’t too enthusiastic about discussing this portion of the blueprint and regularly replied to constituents’ questions about eligibility by using the phrase “when you become eligible” rather than any numerical age.

It’s easy to see why Ryan would be so hesitant to get into actual specifics: keeping seniors out of Medicare longer does reduce federal expenditures, but it also increases out-of-pocket expenses for 65 and 66 year-olds and raises the health care costs of employers. As a recent Kaiser Family Foundation report concluded:

Employers’ costs are estimated to increase by $4.5 billion in 2014 if the Medicare eligibility age is raised to 67. This increase results from employer plans becoming primary rather than secondary payer (wrapping around Medicare) when Medicare is no longer the primary payer. We estimate that total premiums would increase as a result, increasing costs for employers and retirees, each of whom are estimated to pay half of the higher premium. The increase in retiree health costs would also be reflected in the long-term liability of employers for their retiree health obligations.

Moreover, if the Affordable Care Act is not repealed, “premiums for people younger than 65 purchasing coverage through health reform’s insurance exchanges would rise by an estimated 3 percent.” Medicare Part B premiums would increase by a similar amount, as the youngest seniors are removed from the Medicare risk pool.

But the employer piece is particularly overlooked even though it clashes with the GOP’s “no new taxes on the organ of job creation” rhetoric and business agenda. It’s worth taking this up with the National Federation of Independent Businesses (NFIB) — which calls itself the “voice of small business” — given that organization’s endorsement of Ryan in 2010.

The GOP’s Rationing Health Care Plan

Given the relative disfranchisement of Medicaid beneficiaries, elected officials have historically been much more prone to view the Medicaid program in economic terms and justify any proposed reduction in federal or state spending as budgetary necessities. And so it is not surprising that this latest GOP attempt to take away coverage from some 400,000 Medicaid recipients — who are most in need of and least likely to afford health coverage — is being framed as an economic decision rather than legislation that would literally take away medical care from the most vulnerable among us:

With their proposal to turn Medicaid into block grants all but dead, Republicans now are pushing legislation to let states tighten eligibility rules for the health program for the poor and disabled.

The move, which would affect Medicaid as well as the Children’s Health Insurance Program, would help cash-strapped states save money but could also cause hundreds of thousands of people to lose health coverage.

While Democrats strenuously oppose the proposed Medicaid change, some advocates and physician groups worry that the issue could wind up as a bargaining chip in the partisan wrangling over the debt limit. [...]

Medicaid covers about 56 million Americans, with states sharing the costs with the federal government. States have been barred from cutting eligibility for the program since 2009 when economic stimulus legislation gave states billions to prop up their Medicaid program on the condition they didn’t tighten eligibility standards. The 2010 health law extended this requirement until 2014.

According to a Congressional Budget Office analysis, the House Republican proposal to repeal the requirement [which currently prevents states from throwing people off the rolls] would save $2.1 billion from 2012 through 2021. If it became law, approximately 400,000 people – about two-thirds of whom are children – would lose their Medicaid and Children’s Health Insurance Program coverage in 2013. About 100,000 of those people would enroll in employment-based insurance, according to CBO.

That’s right, after mercilessly attacking the Affordable Care Act and Democrats for breaking their promise of “if you like the coverage you have you can keep it,” Republicans on the House Energy and Commerce Health Subcommittee have already approved and many others are lining up to endorse a measure that would permit states to deny coverage to thousands of beneficiaries, effectively rationing their care. Republicans are doing this while trying to repeal the Affordable Care Act and block grant the Medicaid program in order to provide states with less federal dollars to cover people. It turns out that this is the “repeal” in their “repeal and replace.”

Health Care Opinion Leaders Reject GOP’s Argument That Health Reform Undermines States’ Rights

A new survey from the Commonwealth Foundation finds that actual health care policy experts from across the ideological spectrum don’t buy the GOP/Mitt Romney argument that the Affordable Care Act is a one-size-fits-all solution that hampers state innovation and undermines local autonomy. In fact, according to the findings from the latest Commonwealth Fund/Modern Healthcare Health Care Opinion Leaders Survey, a majority of respondents — 203 individuals from the fields of academia and research; health care delivery; business, insurance, and other health industries; and government, labor, and advocacy groups — actually believe that the federal government should have more authority, not less:

41 percent of opinion leaders said the federal government should have more authority and 29 percent say that the law has struck an appropriate balance between states’ and the federal government’s roles. Only 25 percent of respondents thought the states should have more authority.

On many health care reform provisions, opinion leaders were somewhat more likely to think the federal government should have a stronger role. For instance, under the law, new federal rules will prohibit insurers from restricting coverage or basing premiums on health status or gender. Half of health care opinion leaders support granting the federal government more power to set such health insurance market rules; 23 percent feel the law got the balance between the federal government and states about right. In addition, half of respondents favor a stronger role for the federal government in developing and spreading innovative provider payment methods, including new models like accountable care organizations and patient-centered medical homes.

What’s more, 61 percent supported the creation of a federal health insurance exchange and 42 percent said there should be more federal authority over the health insurance exchanges. So policy wonks, as it turns out, prefer a more comprehensive national approach to reform rather than the patchwork — states are mostly on their own — solutions that national GOP figures are trying to advance.

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