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Does the ACA’s Enrollment Mean its Medicare Cuts Went Too Far?

Published by Morning Consult
Eric Berger
December 1, 2014

Robbing Peter to pay Paul never seems to work out over the long-term to anyone’s benefit. Based on recent indicators, the same may be true for senior citizens and the Affordable Care Act (ACA), as well.

The Centers for Medicare & Medicaid Services (CMS) acknowledged last week that 6.7 million Americans have enrolled in healthcare plans as of last month – an outcome more than 15 percent below the 8 million enrollees predicted by the Administration just six months ago. Just as troubling, the Congressional Budget Office (CBO) estimates that 2015 enrollments will fall short by a startling 30 percent: in place of the 13 million enrollees originally expected in the health insurance marketplaces, CBO projects we’ll instead see just 9 million Americans.

Based on these data points, two preliminary conclusions are coming into focus. The first, quite naturally, is that the ACA is not attracting the young, insurance-seeking participants that have long been anticipated. The second is that the deep Medicare cuts which were included in the ACA as a funding mechanism may have been deeper than necessary.

As a result, it is now being questioned whether cutting Medicare by more than $700 billion is still appropriate when the program those cuts were to help fund is attracting far fewer participants than projected.

From the start, it was well known that the ACA’s Medicare cuts would negatively impact America’s seniors. For example, on January 1 of this year, Medicare’s home health benefit was subjected to a four-year, 3.5 percent per year rebasing adjustment. The Administration itself noted this cut would be devastating to the sector, with CMS reporting it will cause “approximately 40 percent” of all home health providers to operate at a loss by 2017.

This, of course, is just one aspect of the ACA’s wide-ranging Medicare changes. And yet, it is illustrative of the concerns now being raised due to the growing disconnect between the ACA’s enrollment and its Medicare cuts.

Not only is the ACA’s home health cut causing agency closures and consolidations, it is most acutely felt by the most vulnerable seniors in the Medicare program. According to an Avalere Heath analysis of federal data, Medicare home health patients are older, poorer, sicker and more likely to be female, minority and disabled than all other Medicare beneficiaries – combined.

Obamacare’s home health cut is also straining a delivery system that is the most cost-effective in Medicare. Skilled home healthcare provided to seniors with complex medical issues actually saves taxpayers money. In fact, one recent study showed that patients receiving home health had 20 percent fewer emergency room visits and saved Medicare $8,477 per patient over a two year period.

As Congress deliberates potential modifications to the ACA, balanced solutions are readily at hand. For example, the Securing Access Via Excellence (SAVE) Medicare Home Health Act (introduced by Reps. Greg Walden and Tom Price as H.R. 5110) would repeal Obamacare’s home health cut and replace it with hospital readmission reform to achieve offsetting savings by improving care for Medicare beneficiaries. Such an approach may be a model for other reforms, as it safeguards Medicare beneficiaries and restores deeper-than-needed cuts without adding a penny to the federal deficit.

Whether future ACA enrollment goals can be met remains to be seen, but it already appears clear that seniors shouldn’t be paying the price in the interim.

See the original article here.

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