Here’s the deal—40 hours is full-time but only in Medicaid expanded states

The Hill's Congress Blog
September 24, 2013

By Frank Knapp Jr.  

Franchise owners descended on Capitol Hill last week to lobby for a modification in the Affordable Care Act.  Their complaint is that under ObamaCare, starting in 2015, businesses with 50 or more full-time employees will either have to offer their workers affordable health insurance or pay a penalty fee under the law’s shared responsibility mandate.

But there’s an easy solution that answers their concerns and at the same helps address one of the biggest threats to success for ObamaCare. 

While my business organization favored no mandate for businesses to offer health insurance -- or alternatively that businesses with fewer than 100 employees should be exempted under such a provision -- we did support the overall healthcare reform effort and ultimately the final version of ObamaCare. The health insurance affordability crisis demanded Congressional action. Plus, by exempting small businesses with fewer than 50 employees from the requirement of shared responsibility, approximately 96 percent of all businesses across the nation are under no obligation to offer health insurance to their employees.

Specifically what the members of the International Franchise Association (IFA) are asking Congress to do now is change the law so that only employees working at least 40 hours a week are counted toward that 50 full-time employee mark. The law now counts employees working at least 30 hours a week as full-time employees.

These business owners, primarily in hospitality and retail, say that they will cut the hours of their workers to stay under the present 30-hour per week rule.  The result, they say, would be employees making less money and still not receiving health insurance.

But that’s not completely true. These low-income workers with reduced hours almost assuredly would receive health insurance if their states expanded Medicaid as provide for under ObamaCare.

The primary purpose of the Affordable Care Act was to get affordable health insurance for almost every citizen. The shared responsibility mandate was simply a way to get the big business community to help with the cost.

Unfortunately, now the larger issue that threatens the success of the healthcare reform is the refusal of at least 21 states to expand Medicaid. Without this expansion almost five million of the mostly working, low-income people in these states will still be uninsured and continue to drive up the cost of health insurance for people with coverage due to cost-shifting. This “hidden tax” on every health insurance policy to pay for the uncompensated care for the uninsured adds about $1000 to every family policy per year according to the actuarial firm of Millikan, Inc.

A compromise is in order that will give these franchisees the relief they are looking for and address the Medicaid expansion problem.

Congress and the president should consider changing the definition of a full-time employee to at least 40 hours per week but only in states that expand Medicaid up to 133 percent of the federal poverty level.  Since logic and common sense were rejected by the states that refused to expand Medicaid, maybe pressure by the IFA business members will be more effective.  The result could be a win-win-win—businesses, low-income workers and insurance policyholders.

Knapp is the president of the South Carolina Small Business Chamber of Commerce and the co-chair of the American Sustainable Business Council Action Fund.

Read more: http://thehill.com/blogs/congress-blog/healthcare/324015-heres-the-deal40-hours-is-full-time-but-only-in-medicaid-expanded-states#ixzz2fpPES2Fd

The low-income uninsured are just not worthy

“Primary care is very important.  Preventative care is very important.”

Those were Governor Nikki Haley’s comments last week in regard to a new healthcare pilot project to start next year for the 18,000 employees of the Medical University of South Carolina.  Employees will choose from all the primary care doctors of MUSC for their medical home.  The employees will even have case managers to help them get the healthcare they need.

In addition to possibly better healthcare, the State Budget and Control Board voted to support the project in order to hold down healthcare costs for the employees and the state.

Said Haley, “If you focus in those two (primary and preventive care), it should be very effective.”

Too bad the Governor doesn’t want to provide primary and preventative healthcare to approximately 200,000 low income uninsured South Carolinians.  That’s how many who do not qualify for the state’s current Medicaid program but won’t earn enough to qualify for premium assistance in the new health insurance marketplace that opens October 1^st.  Abandoned by the state of South Carolina, they will just continue to be uninsured while those with less income and those with more will receive insurance with the help of government.

Tony Keck, who runs the state’s Medicaid program, told the New York Times that, “Our mission is to purchase the most health for our citizens in need, at the least possible cost to the taxpayer.”

For those 200,000 uninsured citizens, the Governor and our Legislature have decided that the least possible cost for their healthcare needs is zero; simply don’t offer them health insurance.  But they could have also spent nothing and provided health insurance.

The feds were willing to pay 100% to put these low income citizens on Medicaid for three years.  Had we done that, these uninsured would have had primary and preventative healthcare and we would have reduced the cost-shifting for uncompensated medical care that causes premiums for the insured to go up.  But that would have required our rabidly partisan government officials to agree that these 200,000 citizens were worthy of good healthcare at zero South Carolina taxpayer-cost under Obamacare.

June 2013 Newsletter

South Carolina Small Business Chamber of Commerce

2013 Legislative Wrap-Up

The 2013 South Carolina legislative session was not a great success for small businesses.

Affordable health insurance was rejected by the General Assembly. The health insurance premiums small businesses and individuals pay for family coverage will continue to be about $1000 more each year because both the House and Senate rejected efforts to use Federal money to expand Medicaid. A bill (S.145) that would also make health insurance more affordable by ending anti-competitive behavior by insurance companies was put off until next year.

Legislation (H.3425 and S.536) that would make solar energy equipment affordable for residential and commercial buildings was killed-off or stalled. And unfortunately a special interest bill (H.3369)that would possibly increase workers’ compensation insurance premiums for all businesses in order to benefit a handful advanced from the House to the Senate.

But there was some good news. Legislation (H.3125)that would direct the SC Department of Commerce to develop financial resources for microbusiness lenders crossed the hall to the Senate. A bill (H.3437) to establish a committee to take a big-picture look at all legislation that would impact small businesses advanced from the House to the Senate.  

The Legislature will pick up this two-year session starting in January.

Duke Energy’s Massive Rate Hike Proposal

The S.C. Small Business Chamber of Commerce is opposing Duke Energy Carolina’s proposed 15.1% average electric rate hike. By intervening in the upcoming Public Service Commission rate hearing on Duke Energy’s filing, the Small Business Chamber is a party of record and will present a witness and cross examine witnesses. This is the seventh time either the Small Business Chamber or its President, Frank Knapp, has intervened in a utility rate case but the first against Duke. For a complete review of the amazing success the Small Business Chamber and Mr. Knapp have had in dramatically reducing rate increases on small businesses to as little as 0.08%, click here.

Members Saving Money with Our Health Insurance Plan

The Small Business Chamber in partnership with Carolina Care Plan is saving our members money with our health insurance plan. Find out if our plan can make health insurance more affordable for your business by clicking here.

Listen to what our members are saying about our health insurance plan:

“Not only do we now have a plan with better benefits than our previous plan, but we also will be saving thousands of dollars in premiums during our first year,” says Bruce Fewell of Corporate Concepts in Columbia.

“I am already seeing better benefits and lower deductibles. Plus, we will save over $8,000 in premiums in the first 12 months,” says Leslie Hagan of Hagan Heating & Air Conditioning in Anderson.

Report: 62 percent of Poll Respondents in Deep South Support Expansion of the Medicaid Program

Majority of Whites as Well as African-Americans Support Medicaid Expansion

In Alabama, Georgia, Louisiana, Mississippi, and South Carolina, Even 47 Percent of Self-Identified Conservatives Support Medicaid Expansion

Washington, D.C.—A poll released today reveals that expanding the Medicaid program as called for in the Affordable Care Act has the solid support—a 62 percent favorable response—of a broad mix of residents in the five southern states of Alabama, Georgia, Louisiana, Mississippi, and South Carolina.

The poll, conducted in March and April by the Joint Center for Political and Economic Studies, found that Medicaid expansion is supported by 78 percent of self-proclaimed liberals, 70 percent of politically-moderate respondents, and nearly half, 47 percent, of the respondents who termed themselves conservative.

Analyzing poll respondents by race, the Joint Center found strong support across racial lines, although African-Americans positive responses (85 percent) clearly outweighed that of non-Hispanic whites (53 percent).

While the poll shows that the Affordable Care Act still faces challenges in acceptance, two of the other key provisions of the law intended to expand health coverage—health insurance premium tax credits and the creation of statewide insurance marketplaces—also drew strong support across the South, with a majority of conservatives joining others in voicing approval.

The poll results showed:

• Respondents in all five states responded favorably (62 percent) to the idea of expanding Medicaid for low-income uninsured adults, as did residents of each individual state—Alabama (64 percent), Georgia (61 percent), Louisiana (63 percent), Mississippi (59 percent) and South Carolina (65 percent).
• Approximately 85 percent of African-Americans supported the expansion, while about 53 percent of non-Hispanic white residents in the five states favored the expanded coverage. 
• Both male and female respondents favored the expansion, with women (65.5 percent) stronger in their support than men (58 percent).
• Support varied less among age groups, although younger respondents, ages 18-24 (66 percent) and 25-44 (64.5 percent), favored Medicaid expansion a bit more than older residents, ages 35-64 (62 percent) and 65 and older (60 percent).
• Medicaid expansion drew strong support from residents of the five states who described themselves as “liberal” (78 percent) and “moderate” (69 percent), while just under half  of the those calling themselves “conservative” (47 percent) favored the expansion.
• Party affiliation sharpened the differences in support for Medicaid expansion, with strong support coming from Democrats (87 percent) and Independents (57 percent), but with many fewer supports among Republicans (38 percent).

“The results of this report should paint a clear picture for southern governors that refusing to implement the Medicaid expansion places them out of step with the needs and wishes of their constituents,” Ron Pollack, Executive Director of Families USA said today.

“These governors need to acknowledge what a growing list of other governors—Democrats and Republicans—have recognized, namely, that the Medicaid expansion is a win-win-win for the people of their states,” Pollack said. “It will reduce the number of people who can’t afford health care; it will increase the number of jobs throughout the state; and it will strengthen the state’s economy.”

“This survey clearly shows that governors and state legislators in the South who are resisting the Medicaid expansion are out-of-step with their constituents,” said Brian D. Smedley, Ph.D., Vice President and Director of the Joint Center's Health Policy Institute. “A strong majority of respondents in our poll understand that not only will broader Medicaid coverage save lives and end unnecessary suffering, it will also stimulate job growth and the economy in these states. We encourage elected officials to take a good look at the benefits of the ACA's Medicaid expansion provisions and make decisions based on the evidence.”

The full polling report, “The Deep South and Medicaid Expansion: The View from Alabama, Georgia, Louisiana, Mississippi and South Carolina,” is available at
www.jointcenter.org/research/the-deep-south-and-medicaid-expansion

Click here for a Families USA data snapshot which summarizes the key findings of the Joint Center's polling report. 

NFIB admits its position on Medicaid expansion will hurt many small businesses

The National Federation of Independent Business (NFIB) has strongly advocated that states not expand their Medicaid programs as allowed under the Affordable Care Act (Obamacare).  This wasn’t a business decision by the organization because expanding Medicaid will benefit small businesses as I have pointed out in opinion editorials (here, here and here).

Instead it was a partisan decision that has been part of the highly political NFIB’s opposition to Obamacare since before there even was Obamacare.  The NFIB was a prominent plaintiff in the Supreme Court challenge to the healthcare law and rails against it to this day.

But now that the NFIB has been politically successful in convincing most states to either outright reject expanding Medicaid or delaying the decision (only 22 states plus the District of Columbia have committed to the expansion), they are now trying to undo the damage to small businesses that their advocacy will spawn.

In a March 18^th letter the NFIB sent to the IRS, the faux small business organization admits that any state that follows the NFIB’s position against expanding Medicaid will result in many small businesses in that state with 50 or more full-time employees being subject to significant penalty fees for those employees who would have qualified for Medicaid.  Under Obamacare any businesses with these numbers of employees are required to either offer health insurance or pay a $2000 annual fee per employee if even one of the workers receives a health insurance premium subsidy within the new insurance exchanges.  However a penalty fee would not be paid on employees covered by Medicaid.

“A business should not face expensive penalties for state and regulatory decisions beyond their control,” the hypocritical NFIB whined to the IRS.  The NFIB wants the IRS not to levy the penalty fees on businesses in states that followed the NFIB’s own position on not expanding Medicaid.

This financial liability for not expanding Medicaid has been well known since the law was passed.  The NFIB simply chose not to share this information with the state legislatures and governors it apparently has so much sway over because it didn’t fit into their mantra of how “bad” Obmacare is.

Now the NFIB want the IRS to clean up its mess! 

ACTION ALERT!!

Expanding Medicaid Essential for Controlling
Health Insurance Costs

Contact Senate Finance Committee NOW!!!

Today the South Carolina Finance Committee begins their budget debate. Whether our state should expand Medicaid to cover individuals with incomes up to 138% of the federal poverty level will be debated.

It is critically important for our state to accept $11.2 billion through 2020 of federal money to cover all the cost for the first 3 years and 90% of it after that. The South Carolina Small Business Chamber and the following chambers have endorsed expanding Medicaid:  Anderson, Charleston, Dillon, Darlington, Florence, North Myrtle Beach and Orangeburg.

Here is why:

--An economic study projects that the federal dollars will create 44,000 jobs and the result will be that the state will actually net $9 million more to its budget by 2020.

--Employees covered by Medicaid will be healthier, miss less work and thus be more productive.

--Small business employers will be better able to afford group health insurance if some of their employees are covered by expanded Medicaid.

--Expanding Medicaid will largely eliminate the “hidden tax” in every health insurance premium to pay for the uncompensated care of the uninsured.  Based on projections of the actuarial firm used by the state’s Department of Health and Human Services, this “hidden tax” is about $1000 per year for family coverage.

--Small businesses with 50 or more full-time employees that decide to offer health insurance rather than pay a penalty fee will not have cover their Medicaid eligible workers.

Contact Senate Finance Committee members now with this message:

Please expand Medicaid to help control the cost of health insurance and health care for small businesses.

Below are the names of these Senators.  Click on the name to find their contact information.

Thank you for your support.

Senate Finance Committee

Leatherman, Hugh K., Sr., Chairman
Setzler, Nikki G.
Peeler, Harvey S., Jr.
McGill, J. Yancey
Courson, John E.
Matthews, John W., Jr.
O'Dell, William H.
Reese, Glenn G.
Hayes, Robert W., Jr.
Alexander, Thomas C.
Grooms, Lawrence K. "Larry"
Pinckney, Clementa C.
Fair, Michael L.
Verdin, Daniel B. "Danny", III
Cromer, Ronnie W.
Bryant, Kevin L.
Jackson, Darrell
Ford, Robert
Cleary, Raymond E., III
Lourie, Joel
Williams, Kent M.
Campbell, Paul G., Jr.
Davis, Tom

 

Fallout for states rejecting Medicaid expansion

By RICARDO ALONSO-ZALDIVAR

Associated Press

  

WASHINGTON (AP) -- Rejecting the Medicaid expansion in the federal health care law could have unexpected consequences for states where Republican lawmakers remain steadfastly opposed to what they scorn as "Obamacare."

It could mean exposing businesses to Internal Revenue Service penalties and leaving low-income citizens unable to afford coverage even as legal immigrants get financial aid for their premiums. For the poorest people, it could virtually guarantee they remain uninsured and dependent on the emergency room at local hospitals that already face federal cutbacks.

Concern about such consequences helped forge a deal in Arkansas last week. The Republican-controlled Legislature endorsed a plan by Democratic Gov. Mike Beebe to accept additional Medicaid money under the federal law, but use the new dollars to buy private insurance for eligible residents.

One of the main arguments for the private option was that it would help businesses avoid tax penalties.

The Obama administration hasn't signed off on the Arkansas deal, and it's unclear how many other states will use it as a model. But it reflects a pragmatic streak in American politics that's still the exception in the polarized health care debate.

"The biggest lesson out of Arkansas is not so much the exact structure of what they are doing," said Alan Weil, executive director of the nonpartisan National Academy for State Health Policy. "Part of it is just a message of creativity, that they can look at it and say, `How can we do this in a way that works for us?'"

About half the nearly 30 million uninsured people expected to gain coverage under President Barack Obama's health care overhaul would do so through Medicaid. Its expansion would cover low-income people making up to 138 percent of the federal poverty level, about $15,860 for an individual.

Middle-class people who don't have coverage at their jobs will be able to purchase private insurance in new state markets, helped by new federal tax credits. The big push to sign up the uninsured starts this fall, and coverage takes effect Jan. 1.

As originally written, the Affordable Care Act required states to accept the Medicaid expansion as a condition of staying in the program. Last summer's Supreme Court decision gave each state the right to decide. While that pleased many governors, it also created complications by opening the door to unintended consequences.

So far, 20 mostly blue states, plus the District of Columbia, have accepted the expansion.

Thirteen GOP-led states have declined. They say Medicaid already is too costly, and they don't trust Washington to keep its promise of generous funding for the expansion, which would mainly help low-income adults with no children at home.

Concerns about unintended consequences could make the most difference in 17 states still weighing options.

A look at some potential side effects:

-The Employer Glitch

States that don't expand Medicaid leave more businesses exposed to tax penalties, according to a recent study by Brian Haile, Jackson Hewitt's senior vice president for tax policy. He estimates the fines could top $1 billion a year in states refusing.

Under the law, employers with 50 or more workers that don't offer coverage face penalties if just one of their workers gets subsidized private insurance through the new state markets. But employers generally do not face fines under the law for workers who enroll in Medicaid.

In states that don't expand Medicaid, some low-income workers who would otherwise have been eligible have a fallback option. They can instead get subsidized private insurance in the law's new markets. But that would trigger a penalty for their employer.

"It highlights how complicated the Affordable Care Act is," said Haile.

-The Immigrant Quirk

Arizona Gov. Jan Brewer, a Republican, called attention this year to this politically awkward problem when she proposed that her state accept the Medicaid expansion.

Under the health law, U.S. citizens below the poverty line - $11,490 for an individual, $23,550 for a family of four - can only get coverage through the Medicaid expansion. But lawfully present immigrants who are also below the poverty level are eligible for subsidized private insurance.

Congress wrote the legislation that way to avoid controversy associated with trying to change previous laws that require legal immigrants to wait five years before they can qualify for Medicaid. Instead of dragging immigration politics into the health care debate, lawmakers devised a detour.

Before the Supreme Court ruling, it was a legislative patch.

Now it could turn into an issue in states with lots of immigrants, such as Texas and Florida, creating the perception that citizens are being disadvantaged versus immigrants.

-The Fairness Argument

Under the law, U.S. citizens below the poverty line can only get taxpayer-subsidized coverage by going into Medicaid. But other low-income people making just enough to put them over the poverty line can get subsidized private insurance through the new state markets.

An individual making $11,700 a year would be able to get a policy. But someone making $300 less would be out of luck, dependent on charity care.

"Americans have very strong feelings about fairness," said Weil.

Medicare and Medicaid chief Marilyn Tavenner, also overseeing the health overhaul, told the Senate recently that cost is a key question as the administration considers the Arkansas deal. Private insurance is more expensive than Medicaid.

But Tavenner said the Arkansas approach may be cost-effective if it reduces the number of low-income people cycling back and forth between Medicaid and private coverage, saving administrative expenses. "We are willing to look at it," she said.

---  Associated Press reporter Andrew DeMillo in Little Rock, Ark., contributed to this report.

Original Article 

Free market trumps concerns over expansion

Rock Hill Herald
March 23, 2013

By Frank Knapp Jr. — Special to The Herald

Why do so many of our state’s officials not believe in our free market economy?

That is the question I keep asking myself every time a state official dismisses the benefits of expanding Medicaid to low-income South Carolinians by saying that there aren’t enough doctors. According to the opponents of Medicaid expansion, if there aren’t enough doctors to handle the increase in demand from the hundreds of thousands of newly insured, then these citizens still won’t have access to health care. Therefore we shouldn’t do it.

This is just one aspect of the debate our Legislature is presently having about expanding Medicaid to citizens with incomes up to 138 percent of the federal poverty level as allowed under Obamacare (Affordable Care Act).

While there might be some legitimate concerns about expanding Medicaid (concerns I believe can all be resolved), the “not enough doctors” objection reflects poorly on South Carolina public officials who typically cite the free market economy as the answer to our state’s problems. One tenet of a free market economy is that when there are customers willing to pay for goods and services, entrepreneurs and businesses will respond by producing the goods and services to fill the consumer demand and make a profit in doing so.

Our health care business community certainly responds to consumer demand as any other industry does. We already have the demand for health care services from the uninsured. But since that demand is not backed up by the ability to pay, our private sector health care community does not ramp up to meet that demand.

Expanding Medicaid changes this dynamic because it puts money on the table that our health care business community won’t pass up. In May of 2010 I participated in a panel to discuss the implications of Obamacare, which had passed Congress two months earlier. One of the other panelists was the CEO of a large primary care physician group in the Lowcountry of our state. He was very critical of the new law but he saw the business opportunity it presented.

This health care executive said that his business would be expanding into more rural areas of the state and locate in strip shopping malls to serve the increased demand from having more people with Medicaid as well as private insurance due to Obamacare. The new locations, he said, would help solve the transportation problems some people have in getting to a doctor.

Just like the health clinics that we see popping up in many of our convenience store chains, the private sector will not let an opportunity to reach new, paying customers pass them by. While these new, even if limited-services, primary care sites use only nurse practitioners for providing health care, the newly insured through Medicaid will find the access they mostly need.

Do we need more doctors? Absolutely. And provisions in Obamacare are addressing these training needs. But the private health care community will work through present shortages. The entrepreneurial spirit will rise to the occasion.

Whenever significant progressive changes from the status quo are proposed, those who object for other reasons have always preached that something can’t work. And almost every time the naysayers turn out to be wrong.

This is again one of those times. Expanding Medicaid is the right thing to do for our low-income citizens and our business community. The new demands on our health care system will be met because that’s what our free market does when there is profit to be made.

Read more here: http://www.heraldonline.com/2013/03/23/4716866/free-market-trumps-concerns-over.html#storylink=cpy

 

Without Medicaid Expansion, Employers Face Higher Tax Penalties Under ACA

Study By Brian Haile
Senior Vice President for Health Policy
Jackson Hewitt Tax Service Inc.

March 13, 2013

Key Findings

 States that do not expand Medicaid leave employers exposed to higher “shared responsibility” payments under the Affordable Care Act (ACA).

 The associated costs to employers could total $876 million to $1.3 billion each year in the 22 states that have opposed, are leaning against, or remain undecided about expanding Medicaid. By way of example, the decision in Texas to forego the Medicaid expansion may increase federal tax penalties on Texas employers by $299 to $448 million each year.

 Any projections of the “net” costs of Medicaid expansions should reflect the very real costs of the shared responsibility penalties to employers in any particular state.

Click here to read the study

SC House votes down making health insurance more affordable for small business

Along party lines the SC House yesterday rejected expanding Medicaid in the state.  Partisonship wins out over pragmatism.  Small businesses lose and our state tax dollars will go to low income citizens in other states unless the Senate acts responsibly.

Expanding Medicaid Essential for Controlling Health Insurance Costs

ACTION ALERT!!

Call Your House Member NOW!!!

Today the South Carolina House begins their budget debate.  Whether our state should expand Medicaid to cover individuals with incomes up to 138% of the federal poverty level will be debated.

It is critically important for our state to accept $11.2 billion through 2020 of federal money to cover all the cost for the first 3 years and 90% of it after that. 

An economic study projects that this new money will create 44,000 jobs and the result will be that the state will actually net $9 million more to its budget by 2020.

Even more important is the direct effect expanding Medicaid will have on small businesses.  The S.C. Small Business Chamber was the first business organization in the state to support the expansion and last week the Charleston Chamber of Commerce also endorsed expanding Medicaid.

Read the op.ed below to see how expanding Medicaid will help small businesses in promoting healthier workers and reducing health insurance expenses.

Call your House member now with this message:

Please expand Medicaid to help control the cost of health insurance and health care for small businesses.

You can find the contact information for every House member here:  http://www.scstatehouse.gov/member.php?chamber=H

Thank you for your support.

------------------------------------

Greenville News March 11, 2013   Guest column: Medicaid expansion is critical here By Frank Knapp Jr.   Recently a representative of the Heritage Foundation told a South Carolina Senate subcommittee that expanding the state’s Medicaid program as allowed under the Affordable Care Act would be bad welfare policy.   Director Tony Keck of our Department of Health and Human Services has framed the argument against expanding Medicaid as an inefficient way of improving the health of our citizens.   These opponents of Medicaid expansion want to distract us from the real purpose of national healthcare reform and providing health insurance to our low-income citizens with incomes up to 138 percent of the federal poverty level.   In 2000 when I co-founded the South Carolina Small Business Chamber of Commerce we held meetings around the state to find out the major issues on the minds of small businesses. One of the top priorities we found was the cost of health insurance. Small businesses wanted affordable health insurance for themselves and their employees. They weren’t talking about welfare or making South Carolinians healthier.   Addressing this problem became one of the key issues throughout the last decade. My organization offered several proposals including raising the state’s cigarette tax to generate funds to subsidize small businesses providing health insurance to low-income workers. This tax was eventually increased in 2010 but the revenue was no longer necessary to help small businesses because national health care reform passed to address the problem of healthcare costs for all small businesses across the country.   There is no question about what national healthcare reform was about. It was titled the “Affordable Care Act.” It wasn’t called the Welfare Act of 2010 or the Improve the Health of our Citizens Act. It was primarily about affordable health insurance and health care. It was the compromise solution to the demands of businesses to get health insurance and healthcare costs under control.   Our Legislature is now considering one of the most important aspects of the Affordable Care Act that will help make health insurance more affordable for businesses and individuals — expanding Medicaid to those who have incomes up to 138 percent of the federal poverty level.   Many of our state’s low-income workers are employed by our small businesses and here is how a Medicaid expansion will directly help us:   First, there is a significant cost to a small business when workers are not on the job because they are sick or have to care for a family member who is ill. Workers with health insurance for themselves and their families miss less work due to illness and are more productive.   Second, small businesses that want to offer health insurance to employees will find it more affordable under a Medicaid expansion. Small employers with Medicaid-eligible workers will have fewer employees to cover on a private group health plan and thus have less in premiums to pay. In addition, with Medicaid expansion the cost of the employee’s private insurance will drop due to a reduction in the “hidden tax” on every health insurance policy to pay for the uncompensated care for the uninsured. Based on projections by Milliman Inc., the actuarial firm used by Director Keck for his cost projections, the reduced premiums could be up to $1,000 per year for family coverage.   The third benefit of a Medicaid expansion involves the requirement of the Affordable Care Act that businesses with 50 or more employees either offer health insurance or pay a penalty. Many larger small businesses in this category will decide to offer insurance but they won’t have any premiums to pay for their employees on Medicaid.   Medicaid expansion is thus critical to achieving affordable health insurance and health care for small business and all of us. Those who want to distract the public and Legislature from the real purpose of expanding Medicaid do so only to confuse the issue. We cannot let them hijack this debate.

Frank Knapp Jr. is president and CEO of the South Carolina Small Business Chamber of Commerce. For more information go to www.scsbc.org.

http://www.greenvilleonline.com/article/20130311/OPINION/303110009/Guest-column-Medicaid-expansion-critical-here?odyssey=mod|newswell|text|Opinion|p

New AARP Survey Shows Support for Medicaid and Medicaid Expansion in South Carolina

(Columbia) A new AARP survey of 800 South Carolina residents 45+ shows that almost 70 percent feel that when compared to other government programs, Medicaid is very to extremely important.   Moreover,  57 percent of 45 to 64 year-olds surveyed disagree with Gov. Nikki Haley’s refusal to accept federal funds to expand Medicaid in South Carolina.

The Survey-in-Brief released today in Columbia, shows 54 percent of total respondents backing the expansion of South Carolina’s Medicaid program to provide health coverage for at least 329,000 uninsured state residents. Medicaid is a joint federal-state government program designed to provide limited health coverage to the poor. Until now, each state could set its own income level for eligibility and the states were required to match federal funds – in South Carolina on a 70/30 basis federal to state.

“Expanding Medicaid will help our state’s workers who’ve lost their jobs or are struggling in jobs without health benefits,” said Teresa Arnold, AARP South Carolina legislative director.  “For older workers hit hardest by the recession and out of the workforce longer than younger workers, this is especially important.” She added “Expanding Medicaid will give people without insurance access to preventive care that can reduce the need for expensive emergency room care, and ease emergency room overcrowding.”

Sixty-four percent agree that the state should use a portion of the trust fund money from the 2000 Tobacco Settlement in order to expand Medicaid in South Carolina.  Under the Affordable Care Act, all states will have the same income eligibility for Medicaid: 138% of the federal poverty level, up to $15,000 income for an individual and $32,000 for a family of four. To fund this, the federal government has allocated funds to each state to pay 100 percent of the expansion cost for the first few years, dropping to 90 percent by 2020.

“Hard working South Carolinians need the security of affordable health care,” said Arnold.  This sentiment is shared by a coalition of organizations and business groups who have formed the Accept ME SC coalition to advocate for Medicaid expansion in South Carolina.

Currently, Governors in twenty-five states, including Florida and New Jersey, are pursuing Federal funding for their state Medicaid program.

The AARP telephone survey, conducted February 13-21, 2013 by RDD Field Services, recorded that 90 percent of the respondents had some type of health care coverage and 92 percent have a positive voting behavior.  Political views split at 43 percent conservative; 31 percent moderate, 8 percent liberal and 19 percent other.

###

 

Patrick Cobb | AARP South Carolina | Communications Director

1201 Main Street | Suite 1280 | Columbia, SC 29201

Office: 803-765-7373 | Cell: 803-261-0304

 

Not expanding Medicaid will cost SC small businesses

The State
February 21, 2013

By FRANK KNAPP JR. — Guest Columnist

Columbia, SC — The debate is underway over whether to expand the federal-state health insurance program, Medicaid, to more uninsured low-income South Carolinians.

Opponents of expansion, made possible by the Affordable Care Act, or Obamacare, are led by Gov. Nikki Haley’s director of Health and Human Services, Tony Keck, who runs the state’s Medicaid program. Mr. Keck’s public position is that the issue is not about cost but about making more of our citizens healthy. He argues that expanding Medicaid is an inefficient way of achieving that goal.

In December, I attended a forum where Mr. Keck explained that having health insurance was not a good predictor of health outcomes. Therefore the state would do better in promoting health by concentrating on education and jobs while encouraging our citizens to make better personal choices about their behavior.

But in response to a question I posed, Mr. Keck admitted that a low-income person’s health would be better if he had Medicaid than if he did not. “But at what cost?” he quickly added.

Mr. Keck’s almost reflexive response reveals that the tactic of arguing that Medicaid isn’t the best way to improve health is really an effort to misdirect the debate away from the real issue — cost.

If we remove the partisanship over Obamacare and admit that improving the level of education, size of paychecks and behavioral decisions of the state’s low-income citizens is an admirable but daunting goal that will take decades to achieve, the primary objection to expanding Medicaid to improve health today is cost.

Opponents of expansion say that the state can’t afford its eventual 10 percent share of the Medicaid expansion. Mr. Keck’s actuary projects that the cost to the state could be up to $1 billion by 2020.

Proponents of expansion point to a study that projects that economic activity in the state will increase by $3.3 billion and 44,000 jobs will be created from expanding Medicaid. This increase in economic impact would result in the state actually taking in more revenue than it would spend on the expansion through 2020, contradicting Mr. Keck’s analysis. After 2020 the state’s budget would experience a small net loss due to expansion.

Unfortunately, this cost debate has largely overlooked an important factor associated with not expanding Medicaid — the cost to our small businesses.

Many low-income employees work for our state’s small businesses, and expanding Medicaid will result in reduced costs to these employers.

First, there is a significant cost to a small business when workers are not on the job because they are sick or have to care for family members who are ill. Even employees who don’t miss work when they are sick are less effective. Workers with health insurance for themselves and their families miss less work due to illness and are more productive. Clearly expanding Medicaid to cover low-income workers will economically benefit their small-business employers.

Second, small businesses that want to offer health insurance to employees will find it more affordable under a Medicaid expansion. Small employers with Medicaid-eligible workers will have fewer employees to cover on a private group health plan and thus have less in premiums to pay. In addition, with expansion the cost of the employee’s private insurance will drop due to a reduction in the hidden tax on every health insurance policy, which pays for the uncompensated care for the uninsured. Based on projections by Milliman, the actuarial firm used by Mr. Keck for his cost projections, the reduced premiums could be up to $1,000 per year for family coverage.

The third benefit of a Medicaid expansion involves the requirement of the Affordable Care Act that businesses with 50 or more employees either offer health insurance or pay a penalty. Workers on Medicaid are not counted toward the total number of employees, so the Medicaid expansion would mean that even many small businesses with 50 or more employees could avoid paying a penalty for not offering health insurance.

While our state officials continue to debate the cost of expanding Medicaid, that debate must include the cost to small businesses for not doing so.

Mr. Knapp is the president and CEO of the S.C. Small Business Chamber of Commerce; contact him at Sbchamber@scsbc.org.

Read more here: http://www.thestate.com/2013/02/21/2641481/knapp-not-expanding-medicaid-will.html#storylink=cpy

 

The ACA Toolbox for Health Reform: What State Health Leaders Aren’t Telling the General Assembly

February 5, 2013

by The Ruoff Group

The Affordable Care Act (ACA) provides health policymakers with a robust set of tools to accomplish important changes to both bring costs under control and improve our health and health care. The coverage expansion which ensures affordable access to this new, high performance health care system is integral to meeting the those goals, not contrary to them as the state’s health leader is telling the General Assembly.

When South Carolina Department of Health and Human Services Director Tony Keck travels the state, his central argument against the ACA and Medicaid expansion is that Congress and the White House asked the wrong question: “How do we insure as many people as possible in the United States?”[1] rather than “How do we get as many people healthy in the United States?”

Keck then points to the “Triple Aim” of health policy first articulated by Dr. Donald M. Berwick, former Administrator of the Centers for Medicare and Medicaid Services of the federal HHS:

 Reduce the per capita cost of health care
 Improve the health of populations
 Improve the patient experience (quality and satisfaction).

We agree with Director Keck’s central premise that we should be paying for health rather than health care, but we disagree that they are mutually exclusive.

Figure 1—with permission of The Commonwealth Fund

In a recent presentation on The Commonwealth Fund’s new report, Confronting Costs: Stabilizing U.S. Health Spending While Moving Toward a High Performance Health Care System (January 2013), Dr. David Blumenthal, M.D., M.P.P., Chair of The Commonwealth Fund, used the chart in Figure 1 to show that the ACA helps move us towards the critically needed changes to the health care system to achieve Keck’s stated goals with a toolbox filled with tools for stabilizing health spending and moving us toward a high performance health care system.

The Keck argument seems to be that we have a choice: provide health insurance coverage or improve our health. Our nation (and state) is facing a health crisis:

1. Massive numbers of uninsured who tax our health systems through inefficient and inappropriate use which often comes too late to be cheap—45 % of non-elderly South Carolina adults with incomes below 138 % of the Federal Poverty Level ($15,856 for a family of one; $32,499 for a family of four) are uninsured[2];

2. Both a very costly and inefficient health system and costs growing faster than the nation’s economy; and

3. Poor health outcomes when compared to other nations.
There are ways to address these. The Commonwealth Fund Commission on a High Performance Health System observes:

As national policy leaders consider approaches to slow and stabilize the growth of federal health spending in ways that also benefit all payers (state and local governments, businesses, and households), it is crucial that these approaches be developed and applied to adhere to and further the goals of a high performance health system. These goals include providing affordable access across the nation to high-quality, well-coordinated and patient-centered care with continuous delivery system innovation. Achieving the goals of a high performance health system, while stabilizing cost growth, requires a focus on the total health system and health care markets, not just federal programs. (Confronting Costs, pp. 18-19; emphasis added.)

Director Keck, a creative health administrator who is using his position to push many of these changes in both public and private sectors in our state, presents a completely false dichotomy. Coverage which ensures affordable access to this new, high performance health care system is integral to meeting the Triple Aim, not contrary to it. When he suggests to the General Assembly and its committees that the ACA only addresses coverage, that is completely untrue.

We can have honest differences over whether South Carolina can afford it’s four percent contribution[3] to a Medicaid Expansion between FY2014 and FY2020. But the state’s chief health policy officer completely mischaracterizing the ACA to the General Assembly can only lead us to bad policy choices on the expansion.
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[1] Unless otherwise noted, all quotes are from Keck’s January 24,2013, presentation to the Senate Medical Affairs Committee’s Affordable Care Act Subcommittee. Video of that presentation is available at: http://www.scstatehouse.gov/video/videofeed.php. Handouts from that meeting are at: https://www.scdhhs.gov/sites/default/files/Medical%20Affairs%20ACA%20Subcommittee%20FINAL%201.24.13.pdf.
[2] US Census Small Area Health Estimates, 2010, at http://www.census.gov/did/www/sahie/data/interactive/.
[3] SCDHHS never shows the marginal costs of the Medicaid Expansion, instead lumping in the unavoidable costs of the ACA, to demonize the ACA and to throw every chunk of cheese and baloney it can onto the scale of Medicaid Expansion costs. If you simply subtract from the costs of their scenario covering a reasonable estimate of costs of the ACA including an expansion their scenario without the expansion, you get $13 billion in total marginal spending, of which the State would be on the hook for $570 million, counting only some of the potential savings from an expansion. These are derived from SCDHHS numbers provided in Milliman Letter to Keck re: AFFORDABLE CARE ACT- FINANCIAL IMPACT SFY 2014 THROUGH SFY 2020 (November 30, 2012).

The Ruoff Group conducts research and policy analysis on issues affecting South Carolinians.  http://TheRuoffGroup.com

Glimmer of hope for Medicaid expansion

The South Carolina House and Senate started the new legislative session yesterday.  For those who have not experienced the occasion it’s similar to the first day back at school in the fall.  Everybody is friendly and happy to see each other.  

All were in a positive mood except for the small crowd in front of the State House in the morning protesting Obamacare and calling for state legislation to nullify the law they claim allows the federal government’s “take-over” of healthcare.  The protesters included several on motorized power scooters that they probably purchased with the help of government insurance called Medicare.  The irony would be laughable if it wasn’t reminiscent of the very first time the nation heard the phrase, “Keep your government hands off my Medicare”.  For the record, I was at that former Congressman Bob Inglis town hall meeting in Simpsonville, SC, when that statement heard around the world was made.

The Obamacare-protesters would have really hooted and hollered had they heard what a reliable source told me yesterday.  The GOP House leadership would like to find a way to expand the state’s Medicaid program as allowed under Obamacare according to my source. 

While Governor Nikki Haley and her HHS director Tony Keck have been telling the public that we can’t afford to expand healthcare services to hundreds of thousands of uninsured low-income South Carolinians, Republican leaders at least in the House might be seeing the issue through less partisan eyes.  The benefits of a Medicaid expansion are improving the health of our citizens thus creating a more productive workforce, making health insurance more affordable for small businesses, protecting our hospitals from revenue loss and adding tens of thousands of new jobs to boost the state’s economy.  

If my source is correct, the real battle in the State House this year over Medicaid expansion might not be so much between different factions in the Legislature but between the Governor and the General Assembly. 

 

 

The Medicaid expansion debate heats up

The advocates of expanding Medicaid in South Carolina were out in force last night at the USC School of Law auditorium.  Hundreds of people turned out to hear presentations by three supporters of the expansion and one opponent, Tony Keck the Director of the SC Department of Health and Human Services.

In his remarks, Mr. Keck chastised the first speaker for barely mentioning health while focusing on the economic reasons for providing Medicaid to South Carolinians up to 138% of the federal poverty level.  His position and that of his boss, Governor Nikki Haley, is that spending money to expand Medicaid to hundreds of thousands of uninsured low income citizens is not the best way to improve their health. 

One of the two slides Mr. Keck showed was the underpinning of this argument.  The slide of a map showed federal data on health outcomes for Medicaid recipients in the state.  Those with Medicaid in the I-95 corridor of shame had far more health problems than Medicaid recipients outside of that area.  This demonstrated, according to Mr. Keck, that government health insurance was not a good determinant of health outcomes.  Better education, jobs and personal decisions along with genetics were more important to better health than simply having health insurance.

When I was recognized to speak, I pointed out that the map he was of present Medicaid recipients but that these were not the people we were actually talking about.  I wanted to see a map of the uninsured South Carolinians who would be eligible for Medicaid under the expansion and how their health outcomes compared with today’s Medicaid recipients.  I predicted that we’d see a big difference between the two groups with those with Medicaid having better health.

Mr. Keck responded with more of the same concerns that expanding Medicaid was not going to be successful in improving health.  But I was able to get in one last question.  Did he think that there would be a different health outcome for a person at 50 percent of the federal poverty level with a child who has Medicaid under our law compared to a person at 60% of the federal poverty level who does not have Medicaid today. 

Mr. Keck responded that of course the person would be better off with Medicaid than without it.  “But at what cost?" he added.

Cost?  Wasn’t this debate supposed to be about health?  When the proponents cite the economic benefits, they get criticized.  But when the opponents of expansion agree that having Medicaid will yield to better health outcomes than not having it, then they evoke “COST”. 

This is going to be an interesting legislative session.