Friday, May 19, 2017

Health care III

Are Alabamians going to get decent, honest, intelligent discussion about health care in the Alabama special election for the U.S. Senate?

This blog entry will endeavor to compile what there is from the candidates (to be updated as more is provided by the candidates).

From Mo Brooks, there is this:


May 4, 2017 
Press Release
Washington, D.C. – Congressman Mo Brooks (AL-05) today voted in favor of the improved and amended American Health Care Act (AHCA) that partially repeals ObamaCare and drives down projected health insurance costs while maintaining coverage for individuals with pre-existing conditions.
Congressman Mo Brooks said, “While today’s health care legislation falls short of the full ObamaCare repeal that I called for and believe in, a partial repeal does more good for working American families than no repeal at all.  I am proud that diligent House Freedom Caucus work has forced amendments that converted substantial increases in health insurance premiums into substantial cuts in health insurance costs for tens of millions of Americans.  The AHCA repeals roughly twenty ObamaCare taxes that have hurt job creators and cut take-home pay.  The AHCA repeals the ObamaCare individual and employer mandate penalties that undermine freedom of choice and liberty.”  
Brooks continued, “Further, the MacArthur-Meadows Amendment forced by the Freedom Caucus helps restore States’ Rights by giving states the discretion to seek and obtain waivers from many of ObamaCare’s most costly, premium-increasing mandates, thereby lowering health insurance costs for struggling American families.  Importantly, in order to receive a waiver, the MacArthur-Meadows amendment requires states to set up a high-risk program that limits higher premiums to one year for those individuals who tried to game the system by refusing to buy insurance.  After one year, the individual would return to standard rate.” 
Brooks stated, “Despite fear-mongering from the left, this legislation explicitly maintains protections for pre-existing conditions and bans health insurers from charging a patient with pre-existing conditions higher premiums as long as they maintain continuous coverage or sign up for new coverage within 63 days of exiting a previous insurance plan.  Consistent with a concerted effort to help those with pre-existing conditions, the amended AHCA provides an additional $8 billion to help offset insurance costs for citizens with pre-existing conditions in those states that seek an approved waiver.  This is on top of the $130 billion available to states through the AHCA’s Patient and State Stability Fund, which seeks to help states repair the damage done by ObamaCare to health markets. And both the $8 billion and $130 billion are over and above the roughly $350 billion per year over-taxed American citizens already give to citizens who have difficulty paying for their health care.”
Brooks concluded, “While the amended AHCA does not fully repeal ObamaCare, and while it is nowhere near what I believe is best, it is a step in the right direction to lower insurance costs for struggling American families and is a vast improvement over ObamaCare.  Leaving ObamaCare in place is not an option for Americans.  I look forward to working with my Senate colleagues to build on the progress made in the House on the AHCA to deliver on our promises to the American people.”
From Luther Strange
Obamacare is a total failure. Skyrocketing premiums and deductibles have made health care unaffordable and inaccessible. Alabama families have learned that having access to health care insurance is not at all the same as having access to quality health care. 
Luther Strange is already working with fellow conservatives in Congress to shape legislation to help President Trump keep his promise to repeal Obamacare and replace it with patient-centered reform, leading to lowered premiums and increased access.

Thursday, May 18, 2017


The special election to fill Jeff Sessions' seat in the United States Senate is off and running.

It is occurring in the context of politics in the United States being in great flux and confusion stemming from the 2016 Presidential election.

The Republicans won the White House and Congress in a surprise last November.

Currently, the Trump agenda is in a turmoil, with much due to Trump self-inflicted problems. The situation is getting alarming for the Republicans, who are starting to worry about the 2018 elections.

The Democrats are struggling over how to rebuild their party.

Voters are very anxious about what is going to happen with their health care.

Two other special Congressional elections are in full swing, one in the Georgia 6th Congressional district that will be decided on June 20th, and the other being an at large Congressional election in Montana that will be decided next Tuesday. Both of these elections are going hot and heavy and being viewed as a referendum on Donald Trump.

The course of the Alabama special election to fill Jeff Sessions' seat awaits playing out in the above context of flux and confusion in United States politics.

In this Alabama special election for the United States Senate, two big issues the candidates would seem to need to confront are, first, President Donald Trump, and, second, health care.

Alabama voters should take a great interest in the Alabama special election, and also the election has the potential for attracting significant national attention.

For informational purposes, the candidates are listed below, including a links to their campaign websites as they become available.

Luther Strange
Mo Brooks
Roy Moore
Randy Brinson
Dom Gentile
Trip Pittman
Bryan Peoples
Mary Maxwell
Joseph Breault
James Beretta
Karen Jackson

Doug Jones
Will Boyd
Vann Caldwell
Jason Fisher
Michael Hansen
Robert Kennedy, Jr.
Brian McGee
Nana Tchienkou

Sunday, May 14, 2017

Comey questions

To Senators Shelby and Strange and Representatives Byrne, Roby, Rogers, Aderholt, Brooks, and Palmer:

Can you (who are Alabama's Republicans in Congress) please answer these questions:

1. Do you believe President Trump has obligations of truthfulness and credibility to the American people?

2. If yes, do you believe President Trump has fulfilled those obligations during the past seven days related to the James Comey firing?

3. Will you answer the foregoing questions for the benefit of your Alabama constituents?

More questions
4. Did not Trump collude with the Russians when he asked them to interfere in the election to help him? See Smartest colluders.
5. Have both Flynn and Trump lied to Mike Pence?
6. Should FBI interviewees be asked whether they are willing to work for a man who lies to the American people about his conversations with them? (If you want to send tweets to the interviewees asking them this question directly, go to Lying boss.)

Thursday, May 11, 2017

Trey Gowdy

President Trump's firing of James Comey launches the country into a visitation of whether the United States upholds the rule of law and its checks and balances, and whether the firing can rise to the level of abuse of power and obstruction of justice.

Early in the Watergate story, Nixon wanted Ehrlichman and Haldeman to get the CIA to tell the FBI to back away from its investigation by stating to the FBI that matters of national security were involved. This was a blatant abuse of Presidential power.

Now it needs to be determined whether President Trump is abusing his power by giving pretext reasons for firing James Comey when President Trump's real reason is to impede the Russia investigation and whether the same can be obstruction of justice by President Trump.

As with Watergate, responsibility will primarily devolve on Congress to uphold the rule of law and checks and balances and to oppose Presidential abuse of power. This will not be easy because it involves reaching conclusions about what were President Trump's true reasons for firing Comey and what are pretext reasons.

There is good basis to think that Senators Shelby and Strange and Representatives Byrne, Roby, Rogers, Aderholt, Brooks, and Palmer will not be up to fulfilling their responsibilities as members of Congress to uphold the rule of law and checks and balance and to oppose Presidential abuse of power in the Comey firing.

If Senators Shelby and Strange and Representatives Byrne, Roby, Rogers, Aderholt, Brooks, and Palmer wish to begin to show that they are up to the foregoing task, the starting point would be for them to issue statements about Comey's firing. In doing that, they might consider the statement that Rep. Trey Gowdy issued yesterday, which is set forth below.


May 10, 2017 
Press Release
Washington, DC - Rep. Gowdy released a statement following the news of FBI Director Comey.
"Director Comey had a very difficult job. I appreciate his service to our country as both a federal prosecutor and the head of the FBI. I had my differences with him on some matters but never lost sight of the fact that he had a very difficult job and undoubtedly had access to facts that perhaps the rest of us did not. I am thankful for his service to our country and am hopeful our President will select an independent minded person to serve as the head of our nation's premier law enforcement agency. Our justice system is the foundation of our republic. It must be both respected and fully worthy of our respect."
In his farewell letter to the FBI, Comey said, "I have long believed that a President can fire an FBI Director for any reason, or for no reason at all." This needs clarification concerning whether President Trump could fire Comey for the purpose of impeding the Russia investigation but that there is a separate question of "wrongfulness" that Comey himself cannot raise to resist his firing but that can be an abuse of power and obstruction of justice for which the President may be held accountable either criminally or as an impeachable offense. It is believed that the latter is the case. Review of the Nixon articles of impeachement supports that the latter is the case. Opinion of experts will be sought on this.

The contradiction between Trump's letter firing Comey and what Trump has said in Lester Holt interview is material in judging what Trump's real reasons for firing Comey were, and whether Trump endeavored (and continues to endeavor) to deceive the American people and Congress about his real reasons by lying in putting forth pretext reasons for the firing,

Trump's letter firing Comey said:
"I have received the attached letters from the Attorney General and Deputy Attorney General of the United States recommending your dismissal as the director of the Federal Bureau of Investigation.I have accepted their recommendation and you are hereby terminated and removed from office, effective immediately."

In the Lester Holt interview, Trump said he made the decision to fire Comey before he met with Rosenstein on Monday and that, "Regardless of recommendation I was going to fire Comey."

This contradiction is evidence derived soley from Trump that Trump is trying to deceive the American people and Congress about his real reasons for firing Comey. There is much other evidence not derived solely from Trump that Trump is trying to deceive the American people and Congress about his real reasons for firing Comey.

Update 5/12
In the full Lester Holt interview, Trump says "when I decided to do it [fire Comey], I said to myself 'this Russia thing with Trump and Russia is a made up story, it's an excuse by the Democrats for having lost the election'." Trump further says the investigation should have been over long ago, but that "I might even lengthen out the investigation."

Inquiry to legal experts
I have sent the below email to three professors of criminal law at the University of Alabama School of Law:

From: Rob Shattuck <>
Date: Fri, May 12, 2017 at 5:55 PM
Subject: abuse of power; obstruction of justice
Dear Professors Pierson, Rushin and Carroll,
I didn't receive any reply to my previous March 23rd email to you, concerning whether President Trump could have criminal liability for his public urging of the Russians and Wikileaks to release criminally obtained hacking information. See Smartest colluders.
That's ok. I understand.
I am continuing my work and am currently posting about whether Trump's firing of Comey may constitute Presidential abuse of power and obstruction of justice. See my blog entry Trey Gowdy.
If you or any other University of Alabama law professor in the criminal law or constitutional law fields wish to comment on these subjects, I will be pleased to post what you or they have to say.
In support of my purpose here, I will urge persons in the Alabama media to contact their sources of information about the above subjects in question.
Thanks for your attention.

Sunday, May 7, 2017

Tom Price

Alabamians need to watch Jake Tapper's interview of Tom Price this morning.

I think it is amazing what Price is able to say with a straight face.

You watch the below video and decide whether you think Price is being straight with the American people about the effects of cutting $880 billion from Medicaid. You decide how much you can believe Price about anything he says.

I have sent tweets directed to Senators Shelby and Strange and Rep. Palmer asking them whether they think Alabamians can trust Price with their health care and whether he is being straight with the American people. I will post any responses I get.

Update 5/9
Jefferson County Commissioner David Carrington announced yesterday that he is running for Governor of Alabama.
Governors around the country are on the spot about what the The American Health Care Act passed by the House of Representatives will do to their state's Medicaid and health care insurance coverage.
Thus far, my opinion is Alabama's Republicans in Congress are not being straight with Alabamians about what The American Health Care Act will do to Alabamians.
Maybe Commissioner Carrington can undertake study of this and maybe Commissioner Carrington can be straight with Alabamians about the subject even if  Senators Shelby and Strange and Representatives Byrne, Roby, Rogers, Aderholt, Brooks, and Palmer can't be straight with Alabamians about the subject.

Friday, May 5, 2017

Can Rep. Palmer defend himself?

To: Rep. Gary Palmer, Alabama 6th Congressional district

So, how is Congress doing its job now for the American people?

Below is how the Democrats thought Congress was doing its job in 2010 when Obamacare was enacted:

America's health care system has gone through seven long, expensive, wrenching years since 2010.

Do you really think you and the House of Representatives got it right yesterday with The American Health Care Act?

Maybe The American Health Care Act will just die in the Senate.

Maybe it will get changed by the Senate, the House and Senate will agree, and President Trump will sign it into law.

My opinion is that Congress continues to serve the American people poorly.

I predict a huge social collision in the country emanating from the House of Representatives action yesterday.

You own your action of yesterday, and you are going to have to defend it.

I don't think you will be able to defend it well.

We'll see.

Tuesday, April 18, 2017


At his AL06 town hall today, Rep. Palmer explained his health care reform objectives mainly in terms of lowering premiums but maintaining access for people with pre-existing conditions. He said the below described State of Maine reform utilizing "invisible high-risk pools" was the solution he advocated for the country. This needs to be critiqued. [Update 4/19: I have posted my critique following the below article from the Health Affairs Blog describing the State of Maine reform.] [Update 4/23: The past couple of days are indicative that Rep. Palmer is going all in with President Trump, the Liar-in-Chief to the American people about their health care. See the video that has been added at the end of this entry.]

Health Affairs Blog
Invisible High-Risk Pools: How Congress Can Lower Premiums And Deal With Pre-Existing Conditions
March 2, 2017
As Congress and the Trump administration move forward with plans to repeal and replace the Affordable Care Act (ACA), they are looking for proven state-led reforms that maintain access for those with pre-existing conditions in the current exchange market while also lowering premiums for everyone buying insurance in the individual market.

Maine faced similar challenges in 2011 as it sought to unwind failed experiments that pushed its market into a long-term death spiral. But by creating an invisible high-risk pool and relaxing its premium rating bands, Maine policymakers were able to cut premiums in half while still guaranteeing those with pre-existing conditions access to plans.
As a result of these changes, individuals in their early 20s were able to see premium savings of nearly $5,000 per year, while individuals in their 60s saw savings of more than $7,000. As premiums dropped, more young and healthy applicants entered the market, total enrollment increased for the primary insurer in the market, and the individual market’s multi-year death spiral was finally reversed.
Maine’s experience provides federal policymakers with key lessons as they work to repeal and replace the ACA.

Maine’s Failed Experiment With Strict Guaranteed Issue And Community Rating

More than 20 years ago, Maine began enacting disastrous insurance market changes that would eventually become some of the building blocks for the ACA. Those changes led to the same problems now facing the rest of the nation — high premiums, high deductibles, and reduced access to medical providers.
In 1993, Maine policymakers imposed guaranteed issue and community rating requirements on all individual insurance plans. Guaranteed issue requires health insurance plans to sell to all individuals, regardless of their health status. Community rating prohibits insurers from charging actuarially sound premiums based on health status and limits differences insurers can charge based on age.
Maine was one of just eight states (Kentucky, Maine, Massachusetts, New Hampshire, New Jersey, New York, Vermont, and Washington) who experimented with these changes in the 1990s. Despite promises to expand access to everyone, the net result of Maine’s changes was a perverse incentive for individuals to wait until they were sick to purchase coverage. As average claims increased, premiums and deductibles for everyone skyrocketed. Young and healthy individuals soon fled the market as premiums and deductibles rose, prompting even higher premium hikes. More premium hikes were followed by more exits, creating a death spiral in the individual market.
Insurers fled the market, and premiums more than doubled between 1995 and 2001 as the market deteriorated. The number of individuals covered dropped to just 36,000 by 2011 — a 65 percent decline from the 102,000 individuals enrolled in 1993.
The ACA required a similar guarantee issue and community rating regulatory standard, but used the individual mandate, limited open enrollment periods, taxpayer subsidies, and a slightly more expansive community rating band to attempt to mitigate negative enrollment or inflationary premium trends. But those measures were not enough. Millions of Americans witnessed premium and deductible increases, while insurers have cancelled plans and even fled markets.

Maine’s Fix: An Invisible High-Risk Pool And Expanded Age Band Reforms

In 2011, Maine enacted major changes to address its struggling insurance market.Public Law 90 was designed to improve the market using free-market principles and the lessons learned are important for policymakers as they work to unwind the ACA and reshape insurance regulations.
The first thing Maine did was establish an invisible high-risk pool for individual insurance applicants with pre-existing conditions. In practice, it functioned like a hybrid of a reinsurance program and a high-risk pool. It operated like a reinsurance program in that it helped cover claim costs for individuals with high medical claims in the market. It operated like a high-risk pool in that it only targeted a subset of individuals based on specific conditions. However, unlike “traditional” high-risk pools Maine’s program did not remove individuals with pre-existing conditions out of the traditional market or charge them higher premiums.
Secondly, the state expanded rating bands from 1.5-to-1 to 3-to-1, the maximum allowed under the ACA. (Unfortunately, further changes were not possible within the framework of the ACA.)
It was the combination of these reforms—an invisible high-risk pool and expanded age rating bands—that produced positive results by lowering premiums and attracting younger and healthier people to purchase insurance.
It is important to note that lower premiums were not the result of changes to existing requirements that insurers offer coverage year-round to anyone regardless of health status, prohibitions of rating premiums based on health status or sex, or changes to any required benefit mandates.

Transition: Continuing Old Plans But Providing New Options

When Maine began its reform efforts in 2011, it faced a similar challenge to that posed by repealing and replacing the ACA: Maine needed to transition from one set of market rules to another. To minimize market disruption, Maine allowed insurers to simply close existing books of business and open new books under the new reforms. In the closed books, existing policyholders had the option to renew existing policies, but insurers stopped selling those policies to new enrollees.
The insurers were allowed to manage the risk pools of old policies and new options separately, enabling them to independently price the two types of products. Individuals in old policies had the choice to renew their existing policies indefinitely or choose to buy new plans in a reformed market with lower premiums. But the choice remained for the individual to make — no plans were cancelled for any individuals.
Like most states, Maine also discourages insurers from leaving the market by restricting reentry. If insurers leave the individual market, they cannot reenter for at least five years — a significant deterrent for insurers who naturally wish to maintain future access to the market.
In contrast to the mass exits under the failed experiments with community rating and guaranteed issue, no insurers left the market in Maine during its 2011 reform transition.

A Lower Cost Option To Address Pre-Existing Conditions

Maine’s experience with its invisible high-risk pool provides important lessons as Congress and states move forward with repealing and replacing the ACA. One important feature of Maine’s invisible high-risk pool, called the Maine Guaranteed Access Reinsurance Association (MGARA), is that it operated completely behind the scenes.
All applicants were required to complete a health statement with their application for insurance. Insurers used the data provided to determine who to place in the invisible high-risk pool, but individuals were not treated differently. They were enrolled in the same plan they applied for at the same rates, whether placed in the invisible high-risk pool or not. In fact, enrollees had no idea that they were even in the high-risk pool, hence why it is called “invisible.”
The purpose of the pool was simply to help defray the expenses of the highest cost policyholders so those costs didn’t raise the premiums of all policyholders. In effect, everyone was priced as if they were healthy because those with the known high risks were subsidized. By contrast, in a traditional guarantee issue environment, everyone is priced as if they are sick.

The Invisible High-Risk Pool In Action

Initially, the MGARA board identified a handful of specific conditions that were driving cost increases in the individual market. This allowed the program to target subsidies at conditions that would have the biggest impact on lowering overall premiums. They identified eight conditions driving claim costs: chronic obstructive pulmonary disease, endometrial cancer, metastatic cancer, prostate cancer, congestive heart failure, renal failure, rheumatoid arthritis, and HIV. Under a federal repeal and replace plan other states may identify more conditions or even a different set of conditions entirely. State flexibility is critical in this area as it enables focused programs that maximize insurance rate relief while targeting the population health conditions unique to their states.
In Maine, the health statements also asked a broad set of additional questions to allow insurers the ability to voluntarily place other individuals likely to incur large medical expenses in the invisible high-risk pool at the time of application.
Individuals were automatically placed in the invisible high-risk pool if they indicated on their completed health statements that they had one of these eight conditions at the time of application. If they developed one of those conditions later, the insurers remained fully responsible for all costs.
However, insurers were required to transfer 90 percent of collected premiums for all individuals placed in the invisible high-risk pool to MGARA. This helped prevent insurers from gaming the system by removing the opportunity to profit off individuals placed in the invisible high-risk pool. Conversely, if insurers aggressively placed individuals to avoid claim risk, they lost premium revenue. As a result, if insurers effectively placed high-cost claimants, they could offer lower premiums to attract more policyholders.
Here is how it worked in practice. The Maine invisible high-risk pool reimbursed insurers for 90 percent of individuals’ claims between $7,500 and $32,500 per year and 100 percent of claims more than $32,500.
Yet, because insurers bore the risk for up to $10,000 in claims (i.e. the first $7,500 plus 10 percent of the next $25,000), they had little incentive to inappropriately place people in the invisible high-risk pool as they lost almost all premium revenue but remained responsible for up to $10,000 in expenses.
Data from Anthem—the largest insurer in the individual market—reveals that just four percent of applicants had a condition that triggered an automatic placement in the invisible high-risk pool while another 10 percent were voluntarily placed in the pool. Altogether, just 14 percent of applicants were placed in the invisible high-risk pool. This indicates that the invisible high-risk pool was a targeted approach that protected certain individuals with pre-existing conditions while still maintaining lower premiums for all.

Financing The Invisible High-Risk Pool

The program had two primary funding sources. As noted, insurers were required to transfer 90 percent of pool premiums to MGARA. This covered approximately 42 percent of all claim expenses paid by MGARA. The remainder of costs were financed by a $4 per member per month assessment on all policies — raising nearly $28 million on approximately 575,000 covered lives. These funds were sufficient to run the program, unlike many of the “traditional” high-risk pools that ran out of funds.
(For comparison, the ACA’s temporary reinsurance program assessed policyholders $5.25 per member per month in 2014, with funding available only for claims between$45,000 and $250,000.)
To contrast the two programs, Maine’s largest insurer indicated that the invisible high-risk pool reduced premiums by 20 percent. By contrast, the same insurer’s rate filingsindicate that the ACA’s reinsurance program only offset premiums by 8.5 percent.
Put another way, every dollar assessed under the invisible high-risk pool produced a 5 percent reduction in premiums for all individual enrollees. But every dollar assessed under the ACA’s reinsurance program produced just 1.6 percent reduction in premiums. Simply put, the invisible high-risk pool’s targeted approach was more than three times as effective at reducing premiums as the ACA’s reinsurance program for every dollar assessed.

The Invisible Risk Pool’s Independent Structure

MGARA was set up as an independent non-profit organization run by a board of directors. Insurers in the individual market appointed a minority of board members while the majority of the board represented various stakeholders appointed by the state’s Superintendent of Insurance. The independent nature ensured that the funds managed by the program were used solely for their intended purpose, out of reach of legislators who may have wished to raid the funds to balance the state budget or fund other projects during budget crises. This structure helped keep administrative costs for the invisible high-risk pool relatively low — just 2.5 percent of total costs.

Impact Of The Invisible High-Risk Pool

Individuals’ Premiums Dropped By Nearly 70 Percent For Better Plans

As a direct result of the high-risk pool, the state’s largest insurer introduced a suite of new plans with rates as much as 70 percent lower than existing products. These plans were more than 50 percent lower in the highest age category (60 or older). Although critics of the law predicted lower rates for younger applicants at the expense of older applicants, all ages actually gained access to lower cost individual policies and those with pre-existing conditions shared these same savings.
These reforms meant individuals in their early 20s saw savings of roughly $5,000 per year while those in their 60s saw savings of more than $7,000 per year. Those lower-cost new options even had lower deductibles than the higher-cost plans under the old system.

The Largest Insurer In The Individual Market Grew Membership By 13 Percent In Just 18 Months

Prior to the reforms, the individual market was in a death spiral. During the 18 months, immediately before the invisible hig- risk pool launched, Anthem’s individual enrollment dropped 7 percent, continuing a multi-year trend. But after the invisible high-risk pool was implemented, new sales soared.
Comparing the last half of 2012 to the same time period in 2011, Anthem—the largest active insurer in Maine’s individual market—saw new individual contract sales increase by a whopping 59 percent. In the first 18 months of the invisible high-risk pool, Anthem’s individual market enrollment climbed 13 percent.

Younger And Healthier Applicants Voluntarily Enrolled

Anthem also saw a decrease in the average age of their individual policyholders after Maine’s reforms were implemented. The average age of enrollees dropped from 44 just before implementation to 42.5 by March 2013, a decrease of about 3 percent in just 9 months. Insurers were not only attracting new enrollees, but those enrollees were younger on average, reflecting a larger, more stable risk pool and a healthier insurance marketplace.

Lessons For ACA Replacement

Maine’s experience provides Congress and states with the opportunity to learn a number of important lessons as they work to repeal and replace the ACA.
First, it was the combination of expanded age bands and the invisible high-risk pool that resulted in significantly lower rates for consumers. These reforms must happen concurrently. Adjusting the ACA’s restrictive three-to-one age bands to reflect something closer to actuarial reality, such as a five-to-one rating band, will allow insurers to offer lower rates and attract younger applicants.
Second, states need tools to address the expense of high-cost individuals to ensure stable individual insurance markets. One proven approach is to design invisible high-risk pools that:
  • Are invisible to applicants;
  • Do not discriminate with limited options or higher premiums for high-cost individuals;
  • Include mandatory placement of individuals with specific health conditions tailored by the state to maximize the impact on insurance rates;
  • Allow insurers to make ongoing voluntary placement decisions for conditions over and above the eight conditions, but only at the time of application while still maintaining some claim exposure such as the first $10,000;
  • Stretch every dollar as far as possible by capturing 90 percent of premiums of individuals placed in the invisible high-risk pool and through other mechanisms.
On this last point, there is opportunity to further enhance the effectiveness of these programs by adding the ability to manage claims for covered individuals. For example, setting guidelines for the invisible high-risk pools’ claims reimbursement to Medicare or Medicare Plus rates would further lower the costs of the program.
Third, if federal funding for state-run risk management programs is included in an ACA replacement plan, Maine’s assessment formula presents a model that could be utilized to develop a federal funding formula that is simple, targeted, unambiguous, and encourages insurer participation.
Fourth, policymakers need to draw a distinction between a new market or new plan options from the existing policies under the ACA. How to effectively transition those on old plans should be a separate conversation from what new options should be available in the market. Combining the two in a one-size-fits-both strategy can significantly undercut the potential of reform on new plans and new applicants.
Finally, linking participation in new markets to maintaining current enrollment can effectively prevent insurers from abandoning existing markets during the transition period. This is a practice common at the state level.

My critique

At the town hall, Rep. Palmer said that an actuarial study was obtained from Milliman. He also mentioned the actuarial study in an interview with Matt Murphy on April 10th. A podcast of the interview may be found at

Rep. Palmer needs to give fuller discussion of the level and extent of health care that will be provided to insureds who are placed in the invisible high risk pools, as compared to what they get under Obamacare. In particular, he needs to explain why that health care under his invisible high risk pools proposal will not be very much less than under Obamacare.

This inquiry can be understood by first considering the situation under Obamacare and its health insurance plans in a hypothetical state X. In simple terms, the cost paid to all providers of all the health care provided to all Obamacare insureds in state X is equal to the total of the insurance premiums paid by the insureds and the deductibles and co-pays that the insureds pay, minus a 10% or so amount that goes to health insurance company overhead and profit, 

As I understand the invisible high risk pools proposal, the cost of all health care paid to all providers of all the health care provided to all  insureds under the proposal in state X will also similarly be equal to the total of the insurance premiums paid by all the insureds and the deductibles and co-pays that the insureds pay, minus a 10% or so amount that goes to health insurance company overhead and profit, The difference is that that total cost paid to providers is supposed to be very substantially less in comparison to the total cost under Obamacare.

Rep. Palmer needs to explain how this difference in cost can be achieved.

There are two main possible explanations. 

One is that the sum total of all health care provided will be the same, but there will be a substantial reduction in provider charges under Rep. Palmer's proposal, so that the total cost of  the same quantum of health care provided under his proposal will be substantially less.

The second possibility is that the total quantum of health care provided under Rep. Palmer's proposal will be less than the quantum of health care provided under Obamacare.

To the extent the total quantum of health care provided is reduced, Rep. Palmer needs to specify the elements in the reduction of health care that will be provided, and which insureds will receive the less health care.

Based on the description of Rep. Palmer's proposal, it would seem likely that the insureds in the high risk pools will be the ones who will have their health care reduced to the greatest degree.

If there is not going to be a reduced quantum of health care provided, Rep. Palmer needs to explain how provider charges will come down, so that the same total quantum of health care will be provided at a much lesser cost.

It is the case that, under the principles of supply and demand, if the total quantum of health care is reduced (i.e., there is reduced demand), that should result in reduced charges to some extent. The amount of reductions in charges resulting from reduced overall demand would be very hard to predict, could be negligible, and would be dependent on how great the reduction of overall demand is.

There is an argument to be put forth that Rep. Palmer's proposal will result in increased plan choice and increased competition among plans, and that such increased competition will get translated into reduced provider charges.

It is submitted that this is a chimera, and the insurance companies best understand why it is a chimera. The insurance companies are most informed about provider charges, and the contracts they negotiate with providers about charges, and consumers are without information or ability to make meaningful marketplace choices about insurance plans that will filter through to impacting provider charges. Further, insurance companies are practiced in navigating the provider marketplace, out of sight of consumers, with a view to higher insurer profitability, and with little concern about consumer plan choice translating into reduced charges.

Unless and until Rep. Palmer provides explanations about the above, his constituents should express strenuous opposition to Rep. Palmer rushing back to Washington next week to get the House of Representatives to pass his proposal.

Addendum for Rep. Palmer
I have set forth above my critique of your proposed "invisible high risk pools" solution for health care reform.
I believe my critique raises very substantial questions about your proposal, and these questions are deserving of a response from you and also from someone else in the 6th Congressional district who understands your proposal and is capable of vouching for your response and/or giving further articulation of the basis for such person vouching for your response.
If such a response is not provided by you and such other person, you may be presenting a situation in which there is no one in the 6th Congressional district who understands your proposal and is able to vouch for your proposal to your constituents. If that is the case, and you nonetheless propose to return to Washington to advocate in the House of Representatives for your proposal, I think you need to tell your constituents that you are not able to put forth to them anyone in the 6th Congressional district who understands your proposal and can vouch for your proposal, and your constituents will need to rely solely on your analysis and judgment about your proposal with no vouching for it by anyone else. This may call your proposal into question for some of your constituents, and perhaps a sufficient number will express doubts that you will have second thoughts about your proposal. If you don't have second thoughts, and nonetheless proceed, you may be held accountable by your constituents in 2018.
As I believe you know, I have made extensive solicitations of input on this matter from the other Alabama Representatives and Senators in Congress, from persons in Alabama having special expertise and knowledge relevant to health care reform, and to persons in the media in Alabama who should be endeavoring to inform Alabamians about the subject of health care reform. Little or nothing has been forthcoming. (This is memorialized in this blog, which can be accessed by starting at the blog entry Health care, and also memorialized in my Twitter account's Tweets & replies.)
A starting point for you to be respond might be to get the other Alabama Republicans in Congress to adopt and vouch for your proposal.

Going all in with the Liar-in-Chief
The evidence of the past couple of days appears to be that Rep. Palmer is going all in with President Trump, the Liar-in-Chief to the American people about their health care. Watch the below video prepared by Shea Rives of Alabama Indivisible - District 6, and start to formulate your own conclusions about the situation. Rep Palmer will be offered an opportunity to reply and, if he replies, his reply will be posted beneath the video.