Healthcare in America: Overview

KEY HEALTHCARE NEWS:

• Tues, Apr. 16, 2024: CBO report: Medicare Accountable Care Organizations: Past Performance and Future Directions
• Fri, Apr. 12, 2024: KFF reports that “nearly a quarter of people who say they were disenrolled from Medicaid during the “unwinding” (post-Covid) are now uninsured.”
• Wed, Mar. 13, 2024:  The Hill reported Senate Republican Leader Mitch McConnell “threw cold water over the long-held Republican aim of repealing the Affordable Care Act (also known as Obamacare), saying this week that fight is ‘largely over.'” Former President Trump has repeatedly called for the repeal of the Affordable Care Act without offering an alternative to enable Americans with preexisting conditions and without employer coverage to purchase health insurance.
• Fri, Mar. 8, 2024:  See this KFF review of five health policy topics touched on during the State of the Union Address: Abortion, Drug Prices, Affordable Care Act, Health Care Affordability, and Gun Violence.
• Tues, Feb. 27, 2024:  Roll Call reports that “health package talks (broke) down amid broader spending feud….(A) smaller bill will likely focus (on) extender policies as well as…funding for community health centers and partial offsets to scheduled Medicare cuts for physicians.”
• Wed, Jan. 31, 2024:  CBO Testimony on Federal Subsidies for Health Insurance and Policies to Reduce the Prices Paid by Commercial Insurers
• Wed, Jan. 24, 2024:  CNN reports that “a record 21.3 million Americans flocked to Affordable Care Act coverage for 2024, further cementing the law’s place in the nation’s health care landscape.”
  
• Fri, May 26, 2023: NYTimes: Hundreds of Thousands Have Lost Medicaid Coverage Since Pandemic Protections Expired
• Wed. May 24, 2023: CBO report: health insurance for people younger than 65 — Expiration of Temporary Policies Projected to Reshuffle Coverage
• Tues. May 16, 2023: CBO Federal Health Spending Update

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LINKS TO SECTIONS BELOW:

Healthcare in America Overview
Medicare
Medicaid
Affordable Care Act
Children’s Health Insurance Program
Community Health Centers

HEALTHCARE IN AMERICA OVERVIEW:

America has a patchwork quilt of healthcare, which depends on age, income, employment and demographic. You have access to affordable health care if:

• You are 65 or older (Medicare).
• You work for an employer who provides group health insurance.
• You recently worked for an employer who provided group health coverage, and you can afford to pay for COBRA continuation coverage (which allows you to continue the coverage for 18 months by paying the employee’s share and the employer’s share of the monthly health premium—often costing over $2000 per month for a family).
• You are low-income and qualify for Affordable Care Act (Obamacare) subsidies to purchase health insurance on a state exchange or the national exchange;
• You are at, or below the Federal Poverty Level and qualify for Medicaid in your State as a covered cohort and you can find a provider nearby who accepts Medicaid’s relatively low provider payments;
• You live in a Medicaid expansion State and have income near, at, or below the Federal Poverty Level;
• You are aged, blind, or disabled, and your income is less than 75% of the Federal Poverty Level (Medicaid);
• You are a child in a low-income family that earns too much for Medicaid but is poor enough to qualify for the State’s CHIP program (Children’s Health Insurance Program);
• You are active duty military, a military retiree, or an immediate family member of a military person (TRICARE coverage);
• You are a veteran in a “high-priority” group (i.e., service-connected disability and/or low-income) (Veterans Health Administration);
• You are a dependent or survivor of a veteran permanently and totally disabled from a service-connected condition (CHAMPVA).
• You cannot work due to a disability (after two years on Social Security Disability Insurance, you are entitled to Medicare coverage).
• You are an American Indian or an Alaskan Native and live near an Indian Health Service facility.
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Medicare:

• Medicare is a national health insurance entitlement program for nearly all Americans 65 and older.
• Medicare was established in 1965 under Title XVIII of the Social Security Act to provide health insurance to individuals 65 and older, and has been expanded over the years to include workers who have become disabled and people diagnosed with end-stage renal disease or amyotrophic lateral sclerosis (ALS, or Lou Gehrig’s disease).
• The program is administered by the Centers for Medicare & Medicaid Services (CMS), and by private entities that contract with CMS to provide claims processing, auditing, and quality control services.
• The Medicare program has two separate trust funds, the Hospital Insurance (HI) Trust Fund and the Supplementary Medical Insurance (SMI) Trust Fund.
• HI, otherwise known as Medicare Part A, covers most of the costs of hospital, home health services following hospital stays, skilled nursing facilities, and hospice care for seniors and disabled Americans.
• SMI consists of Medicare Parts B and D. For people who voluntarily enroll, Part B covers most of the costs for physician and outpatient hospital visits, home health, and other services for seniors and disabled Americans; and Part D provides coverage for prescription drugs.
• General revenues finance roughly three-quarters of Parts B and D, and premiums paid by beneficiaries almost all of the remaining quarter. (See analysis of Medicare financing by Paul Van De Water.)
• Medicare pays doctors, hospitals, and most other providers using a “prospective payment system” under which predetermined payment amounts are established for specific services, with annual “updates” and limitations on patient cost-sharing (deductibles, coinsurance, and co-payments).
• Spending under the program (except for a portion of administrative costs) is considered “mandatory” spending, i.e., it is not subject to annual appropriations decisions.
• Medicare is required to pay for all covered services provided to eligible persons, provided specific criteria are met; this is what makes Medicare an “entitlement.”
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Medicaid:

• Medicaid is a joint federal-state program that pays for primary and acute health care services, and long-term care for 85 million low-income Americans (near or below the Federal poverty level).
• Unlike Medicare, in Medicaid premiums are generally prohibited, although states can impose nominal copayments, coinsurance, or deductibles.  For most enrollees, cost sharing is limited to 5% of income.
• Jointly financed and state administered:  While the Federal government pays more than half the cost of Medicaid services, the program itself is administered by the States—subject to minimum Federal requirements on basic benefits that must be provided and populations that must be covered.
• Medicaid is voluntary for all states and all states have opted to participate. By opting in, States agree to to cover certain mandatory populations and services; however, federal Medicaid waivers grant states flexibility to design their own programs.
• Medicaid is an open-ended entitlement to states which receive reimbursements for costs ranging from from 50% (for high per capita income states) to 78% (low per capita income).  The federal contribution is called the “federal medical assistance percentage (FMAP).
• Prior to enactment of the Affordable Care Act (ACA), Medicaid was generally limited to low-income families with children, pregnant women, seniors, and people with mental or physical disabilities.
• The Affordable Care Act (P.L. 111-148) gave states the option to expand Medicaid eligibility to all low-income adults with incomes up to 133% of the FPL, with the federal government paying nearly the entire cost of the expansion.
• Benefits:For traditional Medicaid benefits, states are required to cover a wide array of services including inpatient hospital, physician, and nursing facility care. States may cover additional services, such as prescription drugs and physical therapy.  There is an Alternative Benefit Plan with more flexibility for enrollees in the Medicaid expansion.
• Delivery of  care:  Medicaid enrollees generally receive benefits through managed care or fee-for-service (FFS). Under FFS, health care providers are paid by the state Medicaid program for each service.  Under managed care, Medicaid enrollees get some or all of their services through an organization under contract with the state. Most Medicaid enrollees are now covered by some form of managed care.
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Affordable Care Act:

• Premium Subsidies for Low- and Middle-Income Americans: For individuals and families above the Medicaid threshold and up to 400% of poverty, federal income-based subsidies are provided for premiums and cost-sharing.  Applies to citizens and legal immigrants.
• Private Sector Health Insurance – Competitive Marketplace:   States set-up health care “Exchanges” where people purchase private health insurance (with subsidies if they are low income); and a Federal health insurance exchange for States that do not establish their own.
• No Discrimination against Preexisting conditions:  Prohibits insurance companies from denying coverage or charging higher premiums due to preexisting conditions.
• No Lifetime Limits on Benefits:  To protect people with chronic and acute conditions, insurance plans are prohibited from capping lifetime benefits.
• Medicaid Expansion for Low-Income Americans:   Individuals and families below 133% of poverty ($33,534 for a family of 4) are entitled to Medicaid health coverage, which charges no premiums.  Available in States that have accepted the federally-funded Medicaid expansion. Applies to citizens and legal immigrants.
• Essential Health Benefits: requires non-grandfathered health plans in the individual and small group markets to cover essential health benefits, which include items and services in the following ten benefit categories: (1) ambulatory patient services; (2) emergency services; (3) hospitalization; (4) maternity and newborn care; (5) mental health and substance use disorder services including behavioral health treatment; (6) prescription drugs; (7) rehabilitative and habilitative services and devices; (8) laboratory services; (9) preventive and wellness services and chronic disease management; and (10) pediatric services.
• Small Employers (25 or fewer) entitled to a tax credit up to 50% of employer’s contribution.
• Children up to Age 26: can remain on their parents’ plans.
• CRS: Overview of the ACA Medicaid Expansion (Jun 2021)
• CRS: Supreme Court Dismisses Challenge to the Affordable Care Act (Jun 2021)
• CRS: Patient Protection and Affordable Care Act (ACA): Resources for Frequently Asked Questions
• CBO: Affordable Care Act Page
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Children’s Health Insurance Program:

• The State Children’s Health Insurance Program (CHIP) is a means-tested program that provides health coverage for children in low-income families that earn too much to qualify for Medicaid.  
• In some states, CHIP covers pregnant women.
• CHIP is jointly financed by the federal government and the states.
• States are responsible for administering CHIP in coordination with Medicaid.
• CHIP benefits are different in each state, but all states provide certain coverage including routine check-ups, immunizations, doctor visits, and prescriptions.
• Eligibility:  To qualify, a recipient must be under 19 or be a primary caregiver with a child under 19, not covered by health insurance (including Medicaid), and a U.S. national, citizen, legal alien, or permanent resident.
• Program Overview from Benefits.gov
• HealthCare.gov CHIP page
• Medicaid.gov CHIP page
• CBO: Medicaid and CHIP page
• MACPAC: Medicaid and CHIP Payment and Access Commission
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Community Health Centers: Mandatory and Discretionary Funding

• The Community Health Center Program, which is administered by HHS, awards grants to outpatient health care facilities that provide care to medically underserved areas or populations.
• Discretionary and Mandatory:  The program is funded through–
  • annual discretionary appropriations (Labor-HHS bill); and
  • the Community Health Center Fund — mandatory funding enacted as part of the Affordable Care Act.
• CHC’s are governed by a community board composed of a majority (51% or more) of health center patients who represent the population served.
• CHC’s provide comprehensive primary health care services as well as supportive services (education, translation and transportation, etc.) that promote access to health care.
• CHC’s provide services available to all with fees adjusted based on ability to pay.
• NACHC:  What is a community health center?
• HRSA (HHS) Community Health Center program requirements
• CRS: The Community Health Center Fund: In Brief
• KFF:  Community Health Centers: Recent Growth and the Role of the ACA  Jan 2017
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