Blue States Rewarded with Slush Funds from the Failure of Obamacare Exchanges?


Time to revisit, in the wake of what many think may be the death of Obamacare, what happens to the money invested in the failed exchanges. For some background, here’s the current status of the debacle that was supposed to ensure everyone had affordable healthcare:

No, Mr. President, expanding Medicaid isn’t a “no brainer”

Earlier this month, President Barack Obama visited Dallas, Texas to give a speech in front of supporters in which he tried to pressure Republican governors to expand Medicaid, a government program that covers people who make below 138% of the federal poverty line.

“We were just talking on the way over here that in addition to signing people up for the marketplaces so they can buy private insurance, part of the Affordable Care Act was expanding the number of working families who would qualify for Medicaid,” President Obama told supporters.

“Here in just the Dallas area, 133,000 people who don’t currently have health insurance would immediately get health insurance without even having to go through the website if the state of Texas decided to do it,” he said. “There’s over $500 million just for this county that would come in to help families get health insurance — has nothing to do with the website — if the state of Texas made this decision.”

“And your neighboring states have made that decision because they look at it and they say, this is a no-brainer, why would not — why would we not want to take advantage of this,” he added.

The fact that President Obama gave this speech in Texas, home to the country’s largest uninsured population, isn’t a coincidence. Seeking to capitalize on the state’s large Hispanic population, there is a big push by activist Democrats with help from the party to “turn Texas blue.” Part of this effort is to pressure Texas politicians, including Gov. Rick Perry, to accept Medicaid expansion, which is part of the Obamacare.

Oregon to scrap its failed $300 million Obamacare exchange

Actually, the headline doesn’t even do justice in describing how much of an epic fail this is. Oregan received more than $300 million in grants from the Obama administration to set up its Obamacare exchange system, only to experience technical glitches so significant that the website didn’t register a single enrollee.

State officials are likely to scrap the exchange — Cover Oregon, which was once called the “White House’s favorite health exchange” — and join the federal Obamacare exchange system:

Alex Pettit, the state’s chief information officer, recommended to an advisory board Thursday that the state hand the reins to the federal government.

Members of the panel appeared to agree, The Oregonian newspaper reported. The board will meet again on Friday morning to further discuss the issue, and perhaps hold a vote.

Pettit will reportedly travel to Washington, D.C. next week to pursue the transition with federal health officials.
Fixing the site would cost $78 million compared with $4 to 6 million to house the system within HealthCare.gov, the slides said.

Administration may extend Obamacare enrollment deadline for some

The White House has hinted that it may extended the Obamacare enrollment deadline for Americans who experienced technical problems on the state and federal exchanges, much like the administration did in December for those who wanted to sign up for health insurance coverage at the beginning of the year.

“March 31 was the deadline, as was the case for the December deadline, we’re going to want to make sure that people who are already in line can finish their enrollment,” White House Press Secretary Jay Carney told reporters on Friday, pointing them to Centers for Medicare and Medicaid Services (CMS) and the Department of Health and Human Services (HHS) for further explanation.

“We want to make sure, as we did in December, on that deadline, that folks who have begun the process are able to complete it,” said Carney. “We certainly expect, naysayers notwithstanding, that there’s going to be continued interest right up to the deadline, and that interest will probably increase as we approach the deadline.”

Administration to allow subsidies for health plans purchased off exchanges

The Obama administration has made yet another unilateral change to Obamacare, this time by extending tax credit subsidies to those who purchased health insurance coverage outside of troubled, dysfunctional state exchanges:

The administration quietly issued a health law fix Thursday to help those states. Several Democratic-led states, including Oregon, Maryland, Massachusetts and Hawaii, are still trying to solve website problems that have eclipsed those experienced earlier by the federal HealthCare.gov site, now largely repaired.

Although the new policy fix is available to any state, Republican governors basically defaulted to federal control of online sign-ups in their states. Those who stand to benefit the most are Democratic governors who plunged ahead and ran into problems. Some are facing sharp criticism at home, from both sides of the political aisle.
HHS said state residents who were unable to sign up because of technical problems may still get federal tax credits if they bought private insurance outside of the new online insurance exchanges.

The federal policy change is significant because until now the administration has stressed that the only place to get taxpayer-subsidized insurance under President Barack Obama’s health law is through the new online markets, called exchanges. Previously, people who bought outside the marketplace were not eligible for subsidies, although they benefit from consumer protections in the law.

Oregon Democrat blames “big business” for his state’s Obamacare woes

Jeff Merkley

Sen. Jeff Merkley (D-OR) has found a new punching bag for his state’s Obamacare exchange website woes. Politico notes that the Oregon Democrat is blaming “big business” for the problems with the state’s health insurance exchange website, CoverOregon.com.

The problems with this particular state exchange are, arguably, even worse than those that occurred on the federal exchange. As of mid-November, Cover Oregon had not enrolled anyone into a private health plan through the exchange. Numbers provided by the Obama Administration found that just 44 people had selected health plans in the first two months of the open enrollment period.

Though enrollment numbers have improved in recent weeks, Oregon officials are still seeing enrollments below even the lowest-level projections. The state’s exchange website, by the way, still isn’t fully functional, despite getting $59 million from the federal government to assist with implementation.

Merkley, who is up for re-election this year, blames Oracle, the California-based company contracted to build the website, for this sordid mess — and it’s a talking point that’s being repeated by Democrats around the country:

Medicaid patients more likely to crowd emergency rooms than uninsured

emergency room

President Barack Obama’s argument for expanding Medicaid just took another blow via a new study from Science which found that Americans on the government-run health insurance program are more likely to end up in emergency rooms that those who are uninsured:

A group of 10,000 low-income Oregon residents who recently obtained Medicaid coverage visited ERs 40% more often than those without insurance.

The new Medicaid recipients used ERs more often for all kinds of health issues, including problems that could have been treated in doctors’ offices during business hours, according to the study published Thursday in the journal Science. Earlier studies had found the same patients used more of other medical services as well.

“Now we know—the hope that Medicaid will save money turns out not to be correct, at least in the first two years,” said Amy Finkelstein, a Massachusetts Institute of Technology economist and a principal investigator of the study.

On average, the Medicaid recipients visited ERs in 12 Portland-area hospitals 1.4 times during an 18-month period, compared with 1.02 visits for the control group without insurance. Using $435 as the average cost of an ER visit, the researchers calculated that Medicaid increased annual ER spending by $120 a covered person. Hospitals often end up footing the bill for uninsured patients.

NY Times: Medicaid expansion could worsen doctor shortage

President Barack Obama, administration officials and many Democrats have been trying to change the narrative on Obamacare by pointing to the tens of thousands of Medicaid enrollments that have come as a result of the program’s expansion under the healthcare law.

They’ve also tried to pressure Republican governors to opt-in to expansion of the program, claiming that the federal government is fronting the money for pay for it, though, that funding drops over the years. States which decided to expand Medicaid will have to begin covering the shortfall by 2017.

But outside of the eventual budget implications for states, Medicaid expansion creates a some very real problems, according a recent report from The New York Times, one of which is that it could exacerbate an already existing doctor shortage in the United States (emphasis added):

Dr. Ted Mazer is one of the few ear, nose and throat specialists in this region who treat low-income people on Medicaid, so many of his patients travel long distances to see him.

But now, as California’s Medicaid program is preparing for a major expansion under President Obama’s health care law, Dr. Mazer says he cannot accept additional patients under the government insurance program for a simple reason: It does not pay enough.

“It’s a bad situation that is likely to be made worse,” he said.

Oregon hasn’t enrolled anyone through Obamacare exchange

Cover Oregon

More than a month after the launch of its Obamacare exchange, Cover Oregon has yet to enroll anyone into a government-approved health plan, despite receiving $59 million from the federal government to assist with implementation of the law:

Despite grand ambitions, an early start, millions of dollars from the federal government and a tech-savvy population, Oregon’s online enrollment system still isn’t ready more than a month after it was supposed to go live. The state has resorted to hiring or reassigning 400 people to process insurance applications by hand.

“We’re all surprised and frustrated that we’re in the position that we’re in now,” said Jesse O’Brien, a health care advocate at the Oregon State Public Interest Research Group, which lobbied for the exchange.

The state has received about 18,000 paper applications, at 19 pages each, and is scrambling to manually file and clear them. State officials have not been able to say when they expect the online system to launch, nor have they established a deadline to submit paper applications in order for coverage to begin Jan. 1. Meanwhile, the exchange’s board is demanding answers from the executive director about when the website will work and how his team will get people enrolled on time.

House Dem: Obama’s health plan promise was “grossly misleading”

Kurt Schrader

During an appearance on Portland-based KGW-TV, Rep. Kurt Schrader (D-OR) said that President Barack Obama’s promise to Americans that they could keep their health plans under Obamacare was “grossly misleading.”

“I think the president was grossly misleading to the American public. I know right away as a veterinarian, I have my own business, that my policies got canceled even before the Affordable Care Act,” Schrader, who is in his third term, told host Laural Porter.

“I know that I would change policies on a regular basis, trying to find the best deal for myself and my employees,” he said. “But a lot of Americans, a lot of Oregonians, have stayed with the same policy for a number of years and, you know, are shocked that their policy got canceled.”

“So I think the president saying you could stay with it and not being honest that a lot of these policies were going to get canceled was grossly misleading to the American public and is causing added stress and added strife as we go through a really difficult time with health care,” he added.

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