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NEWS FLASH

Did The Employer Mandate Work In Massachusetts? | Short answer: yes. “Employer coverage increased in Massachusetts even though health insurance premiums rose in the range of 10 percent every year. So worries that employers would drop coverage and pay the much cheaper penalty ($295 a year) instead, were largely unfounded”:

Justice

The Eleventh Circuit’s Affordable Care Act Decision Cannot Be Squared With The Constitution

Eleventh Circuit Judge Frank Hull

The key passage in today’s opinion striking down part of the Affordable Care Act appears on page 113, where the two judge majority explains how they will determine whether this law is constitutional:

In answering whether the federal government may exercise this asserted power to issue a mandate for Americans to purchase health insurance from private companies, we next examine a number of issues: (1) the unprecedented nature of the individual mandate; (2) whether Congress’s exercise of its commerce authority affords sufficient and meaningful limiting principles; and (3) the far-reaching implications for our federalist structure.

This is one way to evaluate whether a law is constitutional, but a better way is to ask whether the law can be squared with text of the Constitution. The Constitution provides that Congress may “regulate Commerce…among the several states,” and the very first Supreme Court decision interpreting this language made clear that this power is “plenary,” meaning that Congress may choose whatever means it wishes to regulate interstate marketplaces such as the national health care market, so long as it does not violate another textual provision of the Constitution.

A law requiring most Americans to either carry insurance or pay slightly more taxes clearly regulates the national market for health care. It determines how people will finance health care purchases. It lowers the cost of health insurance. And it protects that market from something known as an “adverse selection death spiral.” So that should have been the end of the case. The Court cites no provision of the Constitution limiting Congress’ authority to pass this law because no such provision exists. Read more

NEWS FLASH

HHS Releases Exchange Regulations To Help Individuals Apply For Coverage | Along with the 13 exchange grants, HHS also released three regulations designed to streamline the process of applying for coverage. They are: 1) guidelines and standards for small employers participating in the Small Business Health Options Program or SHOP exchange, 2) eligibility rules for premium tax credits, 3) coordinating and simplifying the exchange with Medicaid and Children’s Health Insurance Program eligibility.

“It’s really three rules that connect to one another,” HHS Secretary Kathleen Sebelius said on a call with reporters. “If you look at this from a consumer lens, we don’t anticipate that individuals, families, small business will have to try to figure out which door to go through. This anticipates a common portal. So somebody enters the marketplace and the system will direct them to the right program or plan. They will not have to, as they do right now, try to sort through confusing options, multiple options.”

The system, in other words, is meant to work in the following manner: an individual would enter the exchange and receive an advanced refundable tax credit that the IRS would directly send to the insurance carrier a monthly payment. Once the individual files their tax returns, they will have to credit the government back if their income fluctuated throughout the year.

NEWS FLASH

Poll: Only 34 Percent Of Americans Could Find $1,000 In Their Savings Accounts | When asked where they would turn if they needed $1,000 in cash fast, only 34 percent of Americans would look to their savings accounts for the money, according to a recent online poll by the National Foundation for Credit Counseling. The other 64 percent would be forced to go elsewhere, from taking out a loan to borrowing from a family member. In a study released in June, Bankrate reported that only 24 percent of the nation has access to six-months of emergency savings, the majority of whom come from high-income households. In contrast, corporations today are sitting on close to $1.12 trillion in cash, a 59 percent increase from 2008.

Sarah Bufkin

Appeals Court Finds Individual Mandate Unconstitutional

Moments ago, in a 2-1 decision, the 11th Circuit Court of Appeals struck down the individual mandate in the Affordable Care Act, ruling that Congress cannot “mandate that individuals enter into contracts with private insurance companies for the purchase of an expensive product from the time they are born until the time they die.” The court kept the rest of the law enact. Some highlights from the decision:

– It is immaterial whether we perceive Congress to be regulating inactivity or a financial decision to forego insurance. Under any framing, the regulated conduct is defined by the absence of both commerce or even the “the production, distribution, and consumption of commodities”—the broad definition of economics in Raich… To connect this conduct to interstate commerce would require a “but-for causal chain” that the Supreme Court has rejected, as it would allow Congress to regulate anything.

In sum, the individual mandate is breathtaking in its expansive scope. It regulates those who have not entered the health care market at all. It regulates those who have entered the health care market, but have not entered the insurance market (and have no intention of doing so). It is over inclusive in when it regulates:it conflates those who presently consume health care with those who will not consume health care for many years into the future. The government’s position amounts to an argument that the mere fact of an individual’s existence substantially affects interstate commerce, and therefore Congress may regulate them at every point of their life.

The decision represents the first time a Democratic appointee — Judge Frank Hull — “voted to strike down the mandate“; Stanley Marcus, a judge nominated by President Ronald Reagan, wrote the dissent in the case. The case was brought by 26 states who challenged both the mandate and the constitutionality of the Affordable Care Act’s Medicaid expansion provision.

Previously, a federal appeals court in Cincinnati had upheld the mandate.

Update

Further analysis of the 300+ page opinion is forthcoming.

Update

White House responds: “Today’s ruling is one of many decisions on the Affordable Care Act that we will see in the weeks and months ahead. In the end, we are confident the Act will ultimately be upheld as constitutional.”

NEWS FLASH

Florida’s Medicaid Privatization Scheme May Reduce Access To Family Planning Services | Earlier this summer, Florida Gov. Rick Scott (R) signed a landmark Medicaid overhaul that will move hundreds of thousands of low-income and elderly Floridians into private managed-care plans operating in Medicaid. The reforms still have to be approved by the federal government — which finances half of the program — but now some pro-choice groups are raising concerns about the measure. As Florida Independent’s Ashley Lopez reports, while insurers have to cover family planning services, the law allows providers not to offer the benefits “due to an objection on moral or religious grounds.” Should that happen, women would be able to use a “fee for service” program, the state health agency says, but it is still not clear how this program will work.

Economy

Likely GOP Presidential Contender Rick Perry Thinks Medicare, Medicaid, And Social Security Are Ponzi Schemes

It is widely expected that Texas Gov. Rick Perry (R) will be announcing his candidacy for the Republican nomination to be president of the United States this weekend.

In the past, Perry has staked out extreme views on a number of economic issues. Last year, he called Social Security a “Ponzi scheme,” and claimed that Americans who are children today will never receive their benefits. He also used this same smear for the Medicaid and Medicare programs.

In an interview with Newsweek’s the Daily Beast last fall that was just published today, Perry expanded further on his belief that these programs are Ponzi schemes:

INTERVIEWER: In Fed Up!, you criticize the progressive era and the changes it produced: the 16th and 17th Amendments, Social Security, Medicare, and so on. I understand being against these things in principle—of longing for a world in which they never existed. But now that they’re part of the fabric of our society, do you think we should actually do away with them?

PERRY: I think every program needs to stand the sunshine of righteous scrutiny. Whether it’s Social Security, whether it’s Medicaid, whether it’s Medicare. You’ve got $115 trillion worth of unfunded liability in those three. They’re bankrupt. They’re a Ponzi scheme. I challenge anybody to stand up and defend the Social Security program that we have today—and particularly defend it to a 27-year-old young man who’s just gotten married and is trying to get his life headed in the right direction economically. I happen to think that the Progressive movement was the beginning of the deterioration of our Constitution from the standpoint of it being abused and misused to do things that Congress wanted to do, and/or the Supreme Court wanted to implement. The New Deal was the launching pad for the Washington largesse as we know it today. And I think we should have a legitimate, honest, national discussion about Washington’s continuing to spend money we don’t have on programs that we don’t need.

A Ponzi scheme is an economic arrangement where the money paid into the system by later entrants is paid right back out as benefits to earlier entrants. None of these social insurance programs that Perry mentioned fit this definition. They benefit those who pay into them with guaranteed benefits. One has to wonder if Perry will be able to get away with maligning these popular programs on the campaign trail.

Update

Perry also seems to believe that Social Security and Medicare are unconstitutional.

Rick Scott’s Explanation For Turning Down Health Reform Grants Doesn’t Make Any Sense

Florida Gov. Rick Scott (R) explained why he had turned away millions of dollars in federal grants from the Affordable Care Act, during an appearance on C-SPAN’s Washington Journal this morning, arguing that the federal dollars were committing the state to implement an unconstitutional law and then spend its on dollars once the funding expired:

SCOTT: What we haven’t accepted are dollars from the federal government that implement the ObamaCare, the Affordable Care Act…they gave us stimulus money and then they stopped and we have to keep those programs going…so what we have to do is, we have to look at those grants and ask, alright how long is the grant for, is it something that fits in with what we’re trying to do?

Watch it:

The partial list of the rejected grants can be found here, and it’s as troubling as Scott’s argument, which we can consider in turn. First, constitutionality of legislation is decided by the courts, not governors. As the leader of a state with the second highest uninsurance rate in the country and a $3.7 billion budget hole, Scott should be focused on ways to improve access to care and preserve critical health services within existing law. The money he’s turned down would have not only plugged some of the gaps in the state budget, but it would have also invested in Florida’s health care system, reduced the number of Floridians who lack coverage, eased the strain on state safety net providers who take care of the uninsured and lowered state spending on uncompensated care. Scott can consult with Mitt Romney on the advantages of financing that kind of reform with federal dollars and the two former businessmen can agree that the state — like any business — can invest money upfront to reap savings in the future.

Fortunately, recent reports have indicated Scott is moving in that direction and may ask the legislature to accept several million of dollars in grants that it has rejected. Asked about that possibility this morning, the governor demurred:

Tenther Of Convenience: Romney’s ‘Federalism’ Argument Applies To Obamacare, But Not Marriage Equality

During last night’s GOP presidential debate in Ames, Iowa, Mitt Romney (R) distinguished his signature 2006 health care reform law from the Affordable Care Act by arguing that as governor, he offered a “state solution” to a “state problem,” while President Obama’s Affordable Care Act imposed a one-size-fits all system on all 50 states. “We put a plan together that was right for Massachusetts,” Romney explained, “the president took the power of the people and the states away from them.”

But minutes later, he used the exact opposite argument to oppose same-sex marriage. When asked if states should have the right to enact marriage equality legislation, Romney responded that they should not, insisting that “marriage should be decided on the federal level” through a constitutional amendment that would deny gay and lesbian people the right to wed or raise children:

ROMNEY: You might wonder, why is that? Why wouldn’t you just let each state make their own decision? And the reason is, people move from state to state of course in a society like ours. They have children as they go to different states, if one state recognizes the marriage and the other does not, what’s the right of that child? What kind of divorce potential proceeding would there be in a state that didn’t recognize the marriage in the first place?

Watch it:

Romney’s rationale for a single, national definition of marriage could also apply to America’s fractured health care system, in which individuals become uninsured if they lose their jobs, move to a state in which their insurer does not operate or one in which they would no longer qualify for health care assistance. As a result, health care costs are shifted throughout the system — from state to state, ultimately increasing federal spending. In 2006, Romney himself recognized this inefficiency and repeatedly suggested that the federal government could adopt Massachusetts’ plan as a model for reforming the national system.

And so Romney is a tenther of convenience. In trying to obscure the fact that the Affordable Care Act was largely modeled off of his health care proposal, Romney berates a president for forcing states to conform to a single national law and argues that they should be free to enact their own reforms. But should a state like New York or Vermont or Massachusetts pass a marriage law with which Romney disagrees, he demands that it conform to his views of marriage and proposes a constitutional amendment that would overturn “the power of the people and the states.”

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Morning CheckUp: August 12, 2011

PawbamaCare: Bachamnn accused Pawlenty of supporting the individual mandate, while he questioned her failure to stop the health care law in its tracks. Watch it:

Rand Paul calls Romneycare “foolish”: “And the state running the health care is a foolish thing,” he said. “State-run mandates are bad, but it doesn’t make them necessarily unconstitutional on the federal level.” [Politico]

AARP urges super committee against benefit cuts: “AARP, which grew nervous during the debt limit debate when entitlements went on the chopping block, urged the committee not to cut Medicare or Social Security benefits. AARP CEO Barry Rand said in a statement that due to the ailing economy, “cuts to the benefits seniors have earned could undermine the standard of living today and for future middle class generations.” He added, “Americans want Medicare, Social Security and Medicaid to be strengthened as part of a broader conversation around health and economic security, not one focused solely on deficit reduction.” [Inside Health Policy]

Rick Perry’s record on abortion: is full of anti-choice decisions. [Blog for Choice]

Arizona court OKs abortion law: “An Arizona appeals court ruled yesterday to allow key parts of a state law restricting abortions to take effect, including one that requires women to see a doctor in person the day before getting an abortion to hear about risks and alternatives.” [AP]

Health companies to hold on to health plans: “Just 8% of respondents, which include health care systems, hospitals and long- and short-term care facilities, said they would ‘very seriously’ consider the elimination of their health care plans in the future due to the health care reform law, while 20% would consider it and 57% would not consider it.” [Business Insurance]

Berwick responds to critics: “I don’t want to withhold a single piece of care from anybody that needs it. I don’t want to cut costs by harming a hair on anyone’s head. My whole belief system is that we can improve. We’re smart enough, we’re good enough, we’re wise enough to improve our way to better care.” [News Hour]

HIV status among heterosexuals linked to income: “Poverty, joblessness, and limited education may play an important role in HIV risk among heterosexuals, the CDC reported. In its first survey among heterosexuals, the agency found that HIV prevalence was higher among those with low socioeconomic status.” [MedpageToday]

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