Outcome Of Election Will Determine Direction Of Health Care Reform

The Record ( — Wednesday, October 24, 2012

The Record

Voters this Election Day will determine not only who will sit in the White House for the next term, but also the direction of health care reform. Their votes will influence how many people are insured, how high premiums will rise — and how much it will cost the federal government.

If President Obama is reelected, the Affordable Care Act's mandate requiring most people to buy health insurance or get it through their employers will be enforced starting in 2014. New subsidies to help low-income people buy insurance on state health exchanges would become available, and federal funds would be offered to states to expand Medicaid to cover more poor people.

Young adults would still be able to get coverage to age 26 on their parents' health plans. Lifetime caps on benefits would remain a thing of the past. And Medicare recipients would still get annual preventive exams and better coverage for prescription drugs.

If Mitt Romney becomes president, he has pledged to repeal what has become known as Obamacare, which he and other conservatives have blasted as too costly. Though he can't do that without congressional approval, his administration would likely let key provisions languish through lack of funds.

Romney opposes the federal mandate requiring people to obtain insurance, which he considers to be emblematic of government overreach. He said he will help the uninsured obtain affordable coverage by changing the tax treatment for individually purchased policies so they get the same deduction as people who pay for employer-sponsored insurance. He would replace the current Medicaid program with block grants to the states — a way to simultaneously hold down federal contributions and let states set their own rules about eligibility and benefits.

But he wouldn't change everything. He has said he will keep the young-adults-to-age-26 provision of health care reform intact, and those with preexisting conditions will be able to buy insurance under certain circumstances. "I'm not getting rid of all health care reform," he said in a recent national television interview.

The different approaches of the two candidates have prompted sharp words and dire predictions from supporters on both sides.

"The effect on the health care landscape in New Jersey is going to be huge," said Jeff Brown, a policy advocate at New Jersey Citizen Action, which supports Obama's efforts. "Either we're going to move forward with expanding affordable health care options for small businesses and families ... or we're going back to letting insurance-company boardrooms make decisions about our health and well-being."

Obamacare will cost too much, said Governor Christie, who campaigns for Romney. "I think it will be significantly more expensive than they ever claim it's going to be," he said. "We can't afford another huge Washington, D.C., program, given that we're sitting on $16 trillion in debt."

America has world-class hospitals and doctors, but millions are uninsured. Employers and their employees as well as people who buy their insurance privately are struggling to pay for insurance premiums, co-pays and deductibles.

Obama believes establishing exchanges where people can buy insurance and the changes to Medicaid and other programs will extend coverage to 30 million uninsured nationwide. The Rutgers Center for State Health Policy estimated that about 450,000 people out of the 1.3 million people currently uninsured in New Jersey would obtain coverage because of Obama's efforts.

Obama said health care costs would actually be corralled by extending coverage to millions more people. These people would no longer rely on emergency rooms for expensive care — costs that are passed along to those with insurance.

But Romney questions the cost of those efforts — and the strain he says it will put on taxpayers, businesses and the economy. He has decried the individual mandate, calling it a "tax" even though he supported such a plan when he was governor of Massachusetts. He also blames the changes Obama made to the health care system for a rise in health insurance premiums. Though he has claimed the increase in premiums has cost people an extra $2,500, the Kaiser Family Foundation puts the average increase for employers and employees together from 2010 to 2012 at $1,975.

Romney's plan will rein in federal costs, but at the risk of causing the ranks of the uninsured to rise, critics said.

The two candidates particularly differ in what they want to do with the Medicaid program.

Under Obama's plan, New Jersey could receive an estimated $22 billion in federal funds over the next decade — money to enroll more than 200,000 more poor people in the state-managed insurance program. Most of the new enrollees would be childless adults with incomes up to about $15,000 annually, who currently are excluded from Medicaid. The federal government would foot the entire bill for the expansion in the first few years, with the states gradually assuming 10 percent of the costs.

But this is where Republican contempt for government-run programs is the loudest.

Romney proposes giving the states the money and letting them figure out how to cover the poor.

"I would like to take the Medicaid dollars that go to states and say to a state, 'You're going to get what you got last year plus inflation plus 1 percent,'Ye" Romney said in the first presidential debate. "Ye'And then you're going to manage your care for your poor in the way you think best.'Ye"

Christie is right behind him: "As governor, I know what's needed in my state a heck of a lot better than some bureaucrat in Health and Human Services in a cubicle in Washington, D.C.," he said at an Elmwood Park town hall meeting last month.

Obama said block grants may look nice on paper, but "we're talking about potentially a 30 percent cut in Medicaid over time. ... Now, you know, that may not seem like a big deal when it just is numbers on a sheet of paper, but if we're talking about a family who's got an autistic kid and is depending on that Medicaid, that's a big problem."

One issue upon which both candidates agree is that the Medicare program needs to change if it is to survive long-term.

Romney and his running mate, U.S. Rep. Paul Ryan, the architect of congressional Republicans' budget proposal, endorse a long-range plan to raise the eligibility age for Medicare to 67 and replace its guaranteed set of benefits with "premium support," or fixed sums, to be used toward the cost of traditional Medicare or a private plan.

That plan would increase out-of-pocket costs for many seniors, according to the Congressional Budget Office.

Obama, meanwhile, supports improved Medicare coverage of prescription drugs and preventive care. His plan to stabilize the program involves reducing overpayments to Medicare managed-care plans and trimming payments to hospitals and doctors. He wants to shift Medicare away from paying for sheer numbers of tests and procedures to an efficient system that rewards quality care.

Seniors know changes need to be made, but they want modifications to the program to be discussed openly and with bipartisan cooperation in Congress, said C. Brian McGuire, an AARP associate director for New Jersey. "There's a lot of confusion out there," he said.

New Jersey has been in a holding pattern when it comes to implementing the health care reform law, and the results of the election will have an immediate impact.

Christie is waiting to see who wins before making key decisions about how the state's health-insurance exchange will be set up and whether to expand Medicaid. As a vocal Romney supporter, he avoided any hint of embracing the president's plan, even after it was upheld by the U.S. Supreme Court. But behind closed doors, contingency planning has been under way.

"I'm out there killing myself for Romney," he said at a Lacey Township town hall meeting late last month, "but if the president wins, I've got to be ready to take care of the people of the state and do my job."

A key deadline for Christie falls just 10 days after the election, on Nov. 16. The governor must decide by then whether the state will set up and run its own health-insurance exchange, partner with the federal government or leave it to the feds to run.

The exchange is a marketplace, probably online, meant to offer a choice of insurance plans from various carriers for people with annual incomes up to $43,500 (or $89,400 for a family of four) who don't have insurance through their jobs. They would receive federal subsidies, on a sliding scale, to help buy insurance. Applications are to be accepted starting next Oct. 1, with coverage starting on Jan. 1, 2014.

Christie's initial opinion "was that we didn't want to run it," he said, citing the expense of operating the program.

Since then, a measure establishing a state-run exchange has passed both houses of the Legislature and has arrived on his desk for a signature. An AARP state poll earlier this year found that nearly three out of five registered voters believe New Jersey should run the exchange, but the governor says the decision is his alone to make — and he won't do it until he has to.

"It's an executive branch call and we'll make the call," he said at a recent press conference.


Where they stand

How Obama and Romney differ on key provisions of health care reform:

The Affordable Care Act

Romney: Would seek to repeal the law as soon as possible, although he has said that he likes certain consumer protections that already have been enacted, such as the inclusion of children up to age 26 on their parents' policies. He would give people who buy their own health insurance the same tax advantages as people who get it through an employer. But critics say the number of uninsured would rise.

Obama: If reelected, the main elements of the president's reform would roll out during his second term, reducing the number of uninsured by 32.9 million nationwide, and leaving 27.1 million uninsured. State-based health-insurance exchanges will be set up where individuals and employees of small businesses can shop for insurance, with federal subsidies for those with incomes up to 400 percent of the federal poverty level. A federal mandate for most individuals to buy health coverage or face a penalty if they don't have employer-sponsored coverage will take effect.


Obama: Has taken steps to improve prescription drug coverage by gradually eliminating the "donut hole" in Part D, and added coverage for annual wellness visits and preventive health screenings. The Affordable Care Act would extend the solvency of the Medicare Trust Fund to 2024 by eliminating overpayments to Medicare Advantage plans, reducing reimbursements to hospitals and doctors, and promoting greater efficiency.

Romney: Favors a gradual increase in the age of eligibility, from 65 to 67. He proposes controlling costs by giving beneficiaries a lump-sum payment to use toward purchase of coverage from private plans or traditional Medicare.


Obama: The federal government would foot the bill for states' expansion of Medicaid to cover everyone with incomes up to 138 percent of the federal poverty level, with states gradually assuming 10 percent of the expansion costs. About 17 million people nationwide would gain coverage this way, including 220,000 in New Jersey, if New Jersey opts to participate.

Romney: Would change Medicaid to a federal block grant program, limiting the increases to the consumer price index plus 1 percent. States could determine their own eligibility standards and benefits.


Obama: Strongly pro-choice. Most employer-sponsored health plans must include free coverage of contraceptive services.

Romney: Opposes abortion, except in cases of rape or incest or when the mother's life is in danger. He wants to eliminate funding for Planned Parenthood. He considers Obama's contraception-coverage provision an attack on religious liberty and would abolish it.

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