• Reflex: November 16, 2011

    Jonathan Adler and Michael Cannon highlight a little known glitch in the ACA. “ObamaCare authorizes premium assistance in state-run exchanges (Section 1311) but not federal ones (Section 1321). In other words, states that refuse to create an exchange can block much of ObamaCare’s spending and practically force Congress to reopen the law for revisions. [… Timothy Jost] argues [that] there’s enough ambiguity here about Congress’s intent that federal courts will permit the administration to resolve it.” Austin’s comment: If this cannot be resolved administratively and requires legislation, it is indeed a serious problem. I wonder if Congress was aware of the issue at the time the Budget Reconciliation amendments to the PPACA were being considered. Was a fix proposed and rejected by the parliamentarian?  

    The AMA does not want exchanges to negotiate with health plans, reports Sam Baker. “Some consumer advocates have endorsed an ‘active purchaser’ model, in which states empower their exchanges to negotiate with insurers and allow only certain plans into the exchange. But insurers — and now doctors — say any plan that meets the federal standards laid out in the healthcare reform law should have access to the exchanges. The AMA endorsed the more laissez-faire approach at the close of a semi-annual meeting Tuesday. […] Competition among insurers gives doctors more bargaining power in setting their rates.” Austin’s comment: I’m waiting for an argument I understand that passive management of an exchange is good for consumers. Meanwhile, you’ll find more about active purchasing in a recent paper by Sabrina Corlette and JoAnn Volk and another by Chapin White. Both are excellent, and I’ll blog about each of them over the next day. In particular, in my noontime post, I will argue that the AMA is worrying about a problem that is not likely to exist. 

    Hands off health reform on Super Committee, reports Matt Dobias. Other than taking the bad step of gutting the public health and prevention fund about which Harold Pollack has written, no changes to the ACA are expected. Don’s comment: If the Super Committee does not address health care, then they are not addressing the main long term driver of the deficit. If we manage to implement the ACA that is a good start. However, I had hoped some sort of political compromise could emerge from the Super Committee that would increase the chances of our implementing a (modified) ACA, making it slightly less of a political football. It looks like the opposite and we will just have to wait for the Supremes and the next election. And I know I said it was exhausting paying attention to these reports and wake me when it is over, but it is like a bad car wreck: I can’t help but looking.

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    • The Adler-Cannon argument about the ACA subsidies is frivolous. The structure of the law makes clear that the federal exchange stands in the shoes of the state exchange, if the state fails to establish an exchange. Moreover, to the extent that there’s a lack of clarity, the courts will defer to the Administration’s interpretation, as Jost explains.