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The latest news on Obamacare from Business Insider

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    obama weatherproof

    Average weekly work hours in the retail sector have fallen in the past 12 months.

    But this is even as employment in the retail sector posted strong gains in the second half of last year, according to Paul Ashworth at Capital Economics.

    Typically, the two move in tandem.

    Ashworth writes that this can be attributed to a specific part of the Affordable Care Act (Obamacare). From the start of 2014, employers with more than 50 employees will be fined $2,000 per employee, if they fail to offer full-time employees health insurance. Workers are considered to be full-time if they work over 30 hours a week.

    "This effect could explain why average weekly hours worked in the retail sector has fallen over the past 12 months, while average hours worked across the private sector as a whole has been broadly unchanged," writes Ashworth. "The gap in relative performance only seemed to begin about 12 months ago."

    Here are two charts that look at 1. average weekly hours worked in the retail sector and overall and 2. employment in retail sector and overall employment.

    avg weekly hours worked chart

    retail and overall employment chart

    Ashworth writes that the reason a similar move hasn't been seen in the leisure and hospitality sector, is because the average weekly hours worked there are already below 30.

    SEE ALSO: ROSENBERG: The Fed Is Trying Like Crazy, But Nothing It's Doing Can Save The Economy

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    Entrepreneur adviceDespite objections by businesses to parts of the Affordable Care Act, there could be as many as 33% more new small businesses over the next few years as a result of the law, reports the WSJ. The Kauffman-RAND Institute for Entrepreneurship Public Policy calculated the estimate. 

    Why the projected increase?

    A major barrier that keeps people, especially those with pre-existing conditions, from starting their own business is the ability to get robust and affordable health insurance. People seek out and keep corporate jobs, not because they want to, but because they feel like they have to. Entrepreneurs call the phenomenon "entrepreneurship lock." 

    The Affordable Care Act could potentially solve that by offering people who start businesses coverage through state- or federally-run marketplaces for insurance (exchanges). 

    But that's a big if. Many details of the law's implementation have yet to be worked out. 

    It won't be fully active for some time yet, and the consequences and price of coverage won't be settled for even longer. Premiums may even go up for young, healthy people. 

    To see that full 33% increase in new businesses, coverage from exchanges would have to be equivalent to that from corporate plans, which is unlikely in the short run. 

    For young people, the idea of being unable to pay for massive medical bills seems distant and unlikely. But many older people have seen it in others or experienced it themselves, or have dependents that they have to worry about. 

    Without a significant savings cushion, a luxury many people don't have, leaving a safe corporate job with benefits just doesn't seem like an option. 

    Great business ideas aren't limited to the affluent or the young, and though it might take a while to play out, this looks like an unsung benefit of the new health care legislation. 

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    John Boehner Mitch McConnell smile

    One of the most politically intense fights over the Affordable Care Act was over the creation of the Independent Payment Advisory Board, infamously dubbed a "death panel" by Republicans during the 2010 elections. 

    On Thursday, Republican House Speaker John Boehner and Senate Minority Leader Mitch McConnell signaled that they would keep working to keep opposition alive by doing everything they can to impede the board's implementation. 

    The two leaders wrote a letter to President Barack Obama, notifying him that they would not be submitting any recommendations to the panel because of their opposition to it and to the law in general. 

    Here's the relevant part of their letter explaining why they aren't offering any recommendations:

    In order to allow supporters to claim that the law’s Medicare cuts would be realized in the future, it tasked IPAB with reducing payments to providers or eliminating payments for certain treatments and procedures altogether.  These reduced payments will force providers to stop seeing Medicare patients, the same way an increased number of doctors have stopped taking Medicaid patients.  This will lead to access problems, waiting lists and denied care for seniors.

    The unfortunate result is that decisions which impact America’s seniors will be made in the absence of the democratic process, without the system of checks and balances that would normally apply to important matters of public policy.  Yet your recent budget called for expanding IPAB by tasking it with making even larger cuts to Medicare than those called for in the health law, even though the trustees of the Medicare program have told us that IPAB’s provider cuts would be “difficult to achieve in practice,” because of the denied care that seniors would experience.

    Though the move will likely play well for Republicans politically, it won't have much of an effect on the implementation of the health care law, at least for the foreseeable future, according to health care law professors. 

    The IPAB is set up to be a 15-member panel. Three members will be chosen by the Republican and Democratic leaders of the House and Senate, and the remaining three are chosen by Obama and the executive branch. All of the members have to be confirmed by the Senate.

    But the IPAB is only needed if Medicare costs are projected to go beyond economic growth plus an additional percentage point in any given year, said Allison Hoffman, an assistant professor of law at UCLA. Right now, Medicare costs aren't growing fast enough to require the board to decide which cuts to make to Medicare providers.

    "There's actually no work for the IPAB to do this year," Hoffman told Business Insider

    McConnell and Boehner's letter has "no impact on the ground," Hoffman said. "It's a protest move. You know — we're not going to cooperate with what the law says in this regard."

    SEE ALSO: GOP Senator: 'Glaring omission' on Benghazi will cause 'real trouble' for State Department >

    MORE: Democrats view Beyonce, Jay-Z favorably

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    Barack Obama grin

    A lack of insurer competition and significant delays in implementing Obamacare's key feature — the Health Insurance Marketplace, also known as insurance exchanges — are going to seriously hamper the program's chance at success. 

    Even some of the most ardent supporters of President Barack Obama's signature health care law are beginning to worry that the Marketplace system will end up causing more problems than it solves.

    The heart of the problem lies in the state insurance exchanges, set up to ensure that Americans who cannot get health insurance from employers and who do not qualify for Medicaid have a chance to get coverage.

    New state Marketplaces are set to open beginning Oct. 1, when millions of Americans who have no employer-based coverage and cannot afford health insurance on their own are expected to enroll. According to various studies, about 26 million Americans will likely be eligible to enroll via the Marketplace.

    The Affordable Care Act creates state-based marketplaces that aim to encourage competition and allow individuals and small businesses to "shop" for insurance plans. The federal government will help run or completely run 33 of the 50 exchanges, while 17 other states will run their own. 

    "It's not going to be a pretty sight," John Lanahan, an insurance broker in Jacksonville, Fla., told Business Insider, adding that he has not supported the law since its conception. "I have clients that are shocked, and I'm telling them, all it's going to do is get worse."

    "It was sold to everybody as, one, you get to keep your doctor. Two, prices are going to stay the same" because of the competition, Lanahan said. "That's not going to happen."

    Obama began a public push on the law on Friday, when he made a statement at the White House on the "health, lives and pocketbooks of women and their families."


    Issues with the exchanges are some of the reasons Democrats are starting to fret about the law's implementation and its electoral implications in 2014. It's why Senate Finance Committee Chairman Max Baucus worried that the law was headed for a "train wreck" upon implementation.

    The major concern about the exchanges is competition — or the lack thereof. The White House's slogan for them is "More Choices, Greater Competition"— but that premise is being thrown into question by a number of factors.

    Supporters of the law and health care experts are cautioning that a lack of competition could decimate that key promise. Many states that are already dominated by a monopolistic system of insurance won't be given an incentive to change that system. 

    For example, BlueCross BlueShield holds a monopoly status in Alabama. Hawaii, Michigan, Delaware, Alaska, North Dakota, South Carolina, Rhode Island, Wyoming, and Nebraska have similar, single-insurer monopolies, said Linda Blumberg, a senior fellow at the Urban Institute. 

    The Affordable Care Act is unlikely to change this, since it will be extraordinarily difficult for new companies to enter into states and gain market share.

    "To try to come into a state and get comparable results with these monolithic companies is incredibly difficult," Blumberg said. "Because you don't have the market share. The other guy has the market share. It is very costly and very challenging."

    Big insurers have so far balked at signing up for the new state Marketplaces. UnitedHealth, the nation's largest insurer, told Reuters that it would join no more than 25 exchanges — and possibly as few as 10. 

    Other big insurers, including WellPoint and Cigna, vaguely said that they were targeting a limited number of states for growth. Other insurers have remained quiet about their plans.

    What's likely to happen, Blumberg said, is that these insurers will enter into marketplaces in states that already have significant competition — New York, California, and Colorado, to name a few — while states with single-insurer monopolies will remain that way. 


    The lack of competition, combined with other new federal regulations, could drive up premiums.

    This could have an effect on insurance premiums, which are already expected to rise. In a recent study, the Society of Actuaries, which skews toward the insurance industry, said it expects premiums to rise by as much as 32% by 2016.

    One of the central premises of the Affordable Care Act, for example, is the requirement that insurers carry everyone regardless of pre-existing conditions. That makes it likely that insurance companies will raise premiums to cover the costs of insuring people who are sick and have high-risk conditions.

    What was supposed to balance this increase is the mandate that all individuals buy health insurance unless they pay a penalty. This would add thousands of young and healthy people to the insurance rolls. But since penalties don't jump until 2016 — it would be just $95 next year — many worry that not enough young people will be immediately persuaded to join the insurance rolls.

    "There's just a lot of angst surrounding what the premiums are going to look like, which insurers are going to participate, and what they're going to charge," Blumberg said. 


    The other major issue is the Obama administration's decision to delay a special system of exchanges that would have made it easier for small businesses to provide multiple insurance options for employees. 

    The Marketplace was designed to create competition by providing businesses with fewer than 100 employees the opportunity to purchase insurance at group rates ordinarily only available to larger organizations, and offer employees more than one health care option.

    Critics say the administration's decision to delay this policy until 2015 offers insurers little incentive to offer lower-priced plans. 

    The concern in the small business industry is that the provision will keep getting delayed because of repeated protests from the insurance industry.

    The insurance industry is not fond of the plan because it forces them to offer competitive plans with each other in the Marketplaces run by the federal government. Marketplaces in these 33 states, then, will not offer a choice of health plans to small business owners.

    One executive for a small business advocacy group, who requested anonymity to speak frankly about the situation, said that the Obama administration was "completely throwing a bone" to the insurance industry. The administration, however, has said that the delay offers more necessary time for the provision to be perfected.

    "That is our concern — insurers will keep saying they hate it, so they will keep getting it delayed and saying they can't do it," the executive said. "... I think the White House saw this as an easy way to throw the insurance industry a bone — we'll give you a year reprieve on this."

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    Barack Obama Obamacare press conference

    President Barack Obama warned the American public on Friday of "misinformation" on the implementation of his signature health care law, urging them to "not get bamboozled" by political forces. 

    "Don't just read a blog or some commentary from some political pundit," Obama said at a press conference Friday that amounted to a rollout of public outreach on the implementation of "Obamacare." 

    "Don't let them run the 'oki doke' on you."

    In a 25-minute press conference, Obama touted the Affordable Care Act's benefits, particularly focusing on women's health in advance of Mother's Day. He stood in front of a handful of women whom he said had already seen the benefits of the law.

    Insurance companies can no longer charge a woman more simply because she is a woman, Obama said. Pregnancy, he added, is no longer a pre-existing condition.

    The second half of his press conference, however, was aimed at Republicans and opponents of the law, who he said were "telling tall tales" and spreading misinformation.

    "That misinformation will continue at least through the next election," Obama said.

    Obama's public touting of the law comes at a time when even supporters are beginning to worry about its implementation.

    SEE ALSO: Republicans are refusing to appoint members to Obamacare's most notorious panel >

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    obamacare protestThe Internal Revenue Service’s scandalous targeting of Tea Party-themed and other conservative groups could severely damage President Obama – but it’s not necessarily because anyone close to the White House sanctioned the allegedly independent actions by the tax collection agency.

    In fact, the president was quick on Monday to condemn the actions exposed in an inspector general's report being released later this week.
    The real fallout could be that it will impede Obamacare, which passed in 2010 under the official title of the Patient Protection and Affordable Care Act.

    The IRS will largely administer this attempt at providing near-universal health insurance. It is responsible for overseeing the tax credits and tax increases in the law, and—most critically—ensuring that businesses and individuals comply with the individual mandate and other major provisions.
    Prominent Republicans are already connecting the unpopular insurance program to the questions swirling around the IRS targeting of non-profits that grew out of the Tea Party movement.

    For them, the scandal is just what the doctor ordered, a chance to attack the IRS--a perennial punching bag--as politically tainted while linking the scandal back to a massive implementation challenge confronting the administration. The House plans a symbolic vote this week to repeal Obamacare, the 37th time it has done so.

    Former House Speaker and GOP presidential candidate Newt Gingrich declared Monday on MSNBC's "Morning Joe,""How can you put Obamacare under the Internal Revenue Service?

     “Why would you trust the bureaucracy with your health if you can’t trust the bureaucracy with your politics?" he said. "There are bureaucrats in the IRS who are capable of ruining your life while lying about it.”

    "Americans should remember that this same corrupt IRS will be in charge of enforcing Obamacare,"Sarah Palin wrote on her Facebook page Friday.  "Forgive me for not trusting these big government promises any more than I trust the White House’s latest Benghazi spin or the IRS’ fairness."
    Ahead of a House Ways and Means Committee hearing this Friday about the IRS scandal, Rep. Diane Black, R-Tenn., said the IRS has no business monitoring anyone's health insurance information. "I will not rest until the full scope of the IRS’ corruption is uncovered, the guilty parties are held accountable, and actions are taken to ensure this never happens again," Black, a member of the committee, told Newsmax.

    The IRS has undermined its own credibility on the issue. It initially claimed before a congressional committee that conservative groups were not under a special microscope. The agency then apologized last week for targeting that supposedly occurred out of a Cincinnati field office. But a new report by the Washington Post on Monday says that IRS officials in Washington and California also queried conservative groups, who were told at the time that a Washington-based task force was overseeing their applications.

    But long before the current uproar over the IRS scrutiny of these politically motivated groups seeking non-profit status, Republicans were challenging budget and staffing levels at the IRS and demanding to know how much the agency intended to spend to implement Obama’s health care reform law.

    The agency has been saddled with an expanding workload and relatively flat funding levels for years that have left the IRS unable to adequately perform its primary duties – collecting taxes, overseeing audits, and providing the public with reasonable service.

    As a result, the agency has struggled to collect the hundreds of billions of dollars a year that the government is owed but not paid, Nina E. Olson, the national taxpayer advocate, said in her annual report to Congress last year.

    Last June, a Government Accountability Office (GAO) report estimated that the IRS would spend $881 million of taxpayers’ money to implement the first four years of Obamacare, including about $500 million that the Department of Health and Human Services (HHS) diverted to the agency.

    The Administration has requested $440 million as part of its 2014 budget proposal to help the IRS prepare for implementing the health care law. And the IRS has estimated that it would need to assign a total of 2,195 employees to deal with health care reform by the end of this year.

    Some Republicans believe that the IRS and administration are intentionally low-balling the actual cost and manpower needs. In March, Rep. Charles Boustany, R-La., the chairman of the House Ways and Means Oversight Subcommittee, called on the acting IRS commissioner Steven T. Miller to provide a detailed accounting on the costs of administering Obamacare.

    Now with House Republican leaders furious about how the IRS treated conservative groups—despite their past denials— several analysts say it is possible the controversy could be used as another excuse to cut agency funding and manpower to further thwart implementing Obamacare.

    “When people look at funding the IRS they’re going to take into account everything that’s out there,” said Floyd Williams, a former legislative affairs director for the IRS who is now with a private Washington public policy strategies firm. “It’s no secret some in Congress have been trying to repeal the Affordable Care Act, let alone limit IRS funding for enforcement . . . . [The] IRS has already suffered the past three years with a status quo budget, which basically is a reduction, especially if you look at people who retired and haven’t been able to be replaced. Now, you have sequestration coming up. All of that added together spells trouble for the IRS and tax law enforcement.”

    Paul Van de Water, a health care policy expert with the Center on Budget and Policy Priorities, cautioned that “it’s hard to tell at this point”  what -- if any -- effect the flap over the IRS’s dealing with conservative groups will have on funding for Affordable Care Act enforcement. 

    “It seems to me that Republicans haven’t lacked for reasons not to provide enough funding for the IRS in the past, so it’s not as if they need a new reason to do so, but who knows? When you get into the realm of politics, all sorts of strange things can happen.”

    Under the legislation, the IRS will provide insurance premium tax credits to help low and moderate income people purchase health coverage. It also will impose penalties on employers that fail to provide insurance and individuals who decline to purchase the coverage made available to them.

    But even without Obamacare, this week’s scandal does have some legs of its own.

    The investigative journalism non-profit ProPublica reported Monday that it had received at the end of last year from the IRS Cincinnati office the confidential and pending applications for tax exemption from nine conservative groups.

    While many organizations bearing the Tea Party name are small players, the applications provided in response to a Freedom of Information Act request included forms submitted by the Karl Rove-linked Crossroads GPS and Americans for Responsible Leadership, an Arizona-based group that supported Republican presidential candidate with more than $5.2 million in expenditures.

    More from The Fiscal Times:

    Diamonds: A Better Safe Haven Than Gold?

    Detroit Needs a Miracle As It Sinks Deeper in Debt

    Has Obama Taken a Page Out of Nixon’s Playbook?

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    It was inevitable once the IRS admitted it had inappropriately targeted conservative non-profits for excessive scrutiny that Republicans would blend the controversy into their ongoing attacks on the Affordable Care Act.

    After all, the Affordable Care Act tasks the IRS with administering tax collection and subsidy provision under the law, and will thus require it to hire new employees.

    Conservatives and GOP members of Congress issued dire warnings shortly after the news broke. But the fact that the revelation came less than a week before the House of Representatives votes (again) to repeal Obamacare probably hastened a legislative linkage.

    And here it is.

    In a letter to Health and Human Services Secretary Kathleen Sebelius and Acting IRS Commissioner Steven Miller, Sen. Dean Heller (R-NV) calls for freezing those dollars for now.

    “I believe we need to address IRS funding in the health care law now, which may mean calling for a temporary suspension until it is clearer where this funding will go,” Heller wrote. “I want you to know I intend to introduce legislation this week to suspend IRS funding for new agents enforcing the health care law until Congress sees an improvement. I am hoping this legislation is unnecessary and that we may work together to find a solution to this problem together.”

    The letter is a bit muddled. It alludes to President Obama’s budget and the ACA itself, without drawing distinctions between the two. Obama’s budget calls for higher IRS spending ahead of ACA implementation, but has no binding force.

    It’s also unclear whether Heller proposes to (perhaps temporarily) withhold money that’s already been appropriated to the IRS, or to rescind its authority to spend current and future funds to implement and administer the law.

    A Heller spokesperson did not immediately respond to a request for clarification.

    At his weekly briefing with reporters Tuesday, House Minority Whip Steny Hoyer (D-MD) addressed the conflation directly. “I don’t think that this [IRS controversy] is anything that is going to undermine the IRS’s credibility vis-a-vis the implementation of the Affordable Care Act.”

    Perhaps. But it’s already refueling the GOP’s ongoing political drive to repeal the law in full or in part.

    And it could draw more attention to brewing conservative efforts to rescind ACA insurance subsidies to beneficiaries in states that will have federally-run exchanges. Senate Minority Whip John Cornyn (R-TX) tried on Tuesday to tie that more obscure issue to the unfolding non-profit scandal.

    “The IRS has announced that it will violate the text of the law and issue health insurance subsidies through federal exchanges, something Congress did not authorize,” Cornyn said remarks on the floor. “The law clearly states that these subsidies are not available to the federal exchange but only to the state-based-exchanges. It’s the case that the President’s health care law will dramatically expand the power of the Internal Revenue Service because the agency is responsible for implementing so much of Obamacare’s most important provisions. Well, given what we’ve learned about IRS malfeasance, does that really sound like a good idea, to give them more responsibility, to hire more agents before we get to the bottom of the present scandal?”

    You can read Heller’s letter in full below.

    Heller Letter to Sebelius IRS

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    John Boehner

    House Republicans are gearing up on Thursday to hold their 37th vote on repealing at least part of the Affordable Care Act, which will soon be implemented across the country.

    Like the past three-dozen or so votes, this one has been viewed with skepticism toward the House Republicans. And there are questions whether another vote to repeal "Obamacare" will hurt the GOP's so-called "rebranding" effort. 

    But Republicans argue, correctly, that repealing Obamacare aligns with what the majority of the American people still say they want. The GOP is playing to an American public that is still largely skeptical of and confused about President Barack Obama's signature legislative achievement. 

    According to a Kaiser Family Foundation poll released last month, four in 10 Americans still don't know that Obamacare is the law of the land and that it is being implemented. 

    That likely contributes to their skepticism and their desire to at least have it altered, if not repealed in its entirety. According to the same poll, 53 percent of Americans said they approved of efforts to change or repeal the law — which is what House Republicans are doing on Thursday.

    If the GOP decided to go further and attempt to defund implementation of the law, as some of its more conservative members have suggested, that's where the party would likely find itself on shaky political ground. By nearly a 2-to-1 margin, respondents to the Kaiser poll said that they disapproved of any possible attempts to cut off funding.

    Here's a chart that outlines those numbers:

    Obamacare poll

    In case there was any doubt, the White House threatened that Obama would veto such legislation if he were presented with it. 

    SEE ALSO: The launch of Obamacare is shaping up to be a 'train wreck' >

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    Coinciding with the House's vote to repeal the Affordable Care Act on Thursday, Rep. Darrell Issa (R-Calif.) promoted a hashtag on Twitter that stirred up partisan emotions on both sides of the aisle.

    Issa's hashtag — #ObamacareInThreeWords — encouraged snark on both sides of the aisle. It also prompted a back and forth between the White House and House Speaker John Boehner.

    Here are a few of the best tweets: 









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    irs Sarah Hall Ingram

    Sarah Hall Ingram, the IRS executive in charge of the tax exempt division when the office began targeting conservative Tea Party, is now running the IRS office in charge with administering Obamacare, ABC reports.

    Meaning she crashed upward.

    As the director of the IRS’ Affordable Care Act office, Ingram is now in a key government position at a time when President Obama just sacked the IRS chief over the targeting scandal.

    An inspector general report released Tuesday confirmed that IRS agents were inappropriately targeting conservative groups applying for tax-exempt status by asking unnecessary requests — notably asking for the names of donors and political affiliations of officers.

    And here's the role of the IRS Affordable Care Act office — with Ingram at the helm — in implementing Obamacare (via The Fiscal Times): 

    The IRS will largely administer this attempt at providing near-universal health insurance. It is responsible for overseeing the tax credits and tax increases in the law, and — most critically — ensuring that businesses and individuals comply with the individual mandate and other major provisions. 

    The Drudge Report highlights a story revealing that Ingram received more than $96,000 in bonuses between 2010 and 2012, which is the period the targeting reportedly took place.

    All in all, the fact that the person who oversaw IRS misdeeds has been promoted to an integral position — instead of being reprimanded — provides Republicans a ton of material to use against Obamacare.

    On Thursday evening the House took another symbolic vote to fully repeal the Affordable Care Act, and House Speaker John Boehner said he had “serious concerns” that the IRS is empowered as the law’s chief enforcer.

    SEE ALSO: The IRS Targeting Scandal Could Disrupt Obamacare

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    Barack Obama health care Obamacare

    After weeks of talk about implementation "train wreck" for the Affordable Care Act, supporters of the law finally got some good news Thursday.  

    Insurance premiums in California's health care exchange will provide plans that range from a 2 percent increase to a 29 percent decrease in premiums, compared to current insurance rates. 

    Covered California, the state agency in charge of the state's health insurance exchange, announced on Thursday that the state will provide 13 insurance plans next year. Medium-level "bronze" and "silver" health insurance plans came in nearly $200 lower a month than predicted, according to the Washington Post's Sarah Kliff

    For those who have been closely following the law and its implementation, these are good signs for overall implementation.

    Linda Blumberg, a senior fellow at the Urban Institute, said the news was positive for a number of key reasons. 

    First, it's a good sign that the 13 plans have created legitimate competition, which has always been the central goal of the law. And that competition comes in the nation's largest state actively working to implement Obamacare, which supporters hope will create a model for other states.

    "It's the most important state," Blumberg told Business Insider. "It's huge. And it has a large number of uninsured."

    The most important part to Blumberg, however, is that premiums will be much lower than was expected. In 2009, the Congressional Budget Office estimated that a "silver plan" would cost an average of $5,200 per year. In reality, at least in California, it will cost approximately $3,312, or $276 per month. 

    For Blumberg, it's a sign that insurers are not trying to "game the system."

    "It's a signal to other states and carriers in other states that, 'listen, you know, there are plenty of insurers out here who want this business, and not everybody is trying to game the system by pricing high out of the blocks.'

    "Because that's one thing you worry about. Without implicitly colluding, they all get in there and say, 'Let's all bid high and see what happens.' This is a sign that ... there are plenty of carriers out there who are going to try to price this smartly and carefully."

    Obviously, California's smooth start does not mean implementation will be easy for the rest of the country. In some states — including Alabama, Hawaii, Michigan, Delaware, Alaska, North Dakota, South Carolina, Rhode Island, Wyoming, and Nebraska — there is the problem of a lack of competition and monopolies. 

    Some states, including Florida and Texas, are not working as hard as California is to implement the law. But for Blumberg, California is the blueprint.

    "It's going to continue to be a mix that's going to continue to play out across the states," Blumberg said. "We're going to see some that are pricing too well, and some that are pricing too high. But I think the dynamics in the market will then lead to changes after that, as you see in California."

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    michael ciampiA Portland, Maine family doctor is the latest poster child for private practitioners who are turning their backs on insurers altogether.

    In April, Dr. Michael Ciampi stopped accepting all forms of insurance, including Medicare and Medicaid, and started charging for his services a la carte. 

    "We're asking people to pay at the time of service just like you would pay at your garage or your lawyer or your plumber," Dr. Michael Ciampi told the Bangor Daily News' Jackie Farwell"Now, I work for patients. I don't work for the government and I don't work for insurance companies." 

    Primary care doctors are among the lowest paid in the industry, and they've seen big cuts to their bottom line recently, as insurers cap physician fees in order to rein in health care costsOnce Obamacare goes into full effect in 2014, it's predicted that insurance premiums will skyrocket, and all the extra paperwork required will cost private practices like Ciampi's more time, money and manpower. 

    The Inquisitir explains:

    A doctor’s income is what the office takes in payments minus expenses or overhead. Physician overhead cover many things but the most expensive cost is the staff necessary to handle insurance coverage. About 20 to 30 years ago this cost used to be around 15 to 30% of revenue. Now for many doctors this insurance overhead has grown to an outstanding 60% or more, with more staff being hired to handle the quickly enlarging piles of paperwork required by Obamacare.

    To top it off, Medicare is beginning to cap payments while the overhead costs remain the same, or worsen. So doctors may stop insurance coverage from Medicare just because they’d see a huge drop in their annual income.

    Since the switch, Ciampi says he has been able to slash his prices by half in some cases, just from his overhead savings alone. But he's lost patients in droves, with several hundred of Ciampi's 2,000 patients ditching him altogether. 

    Nashville, Tenn.-based Dr. Robert Tomsett had similar results after converting to a no-insurance model at his practice in 2011. Unfortunately, his staff paid the price. 

    "We did have to let some of the existing staff go as our patient count has dropped since initiating our transition to self-pay,"Tomsett wrote. "This is typical from accounts by other providers around the country that have converted their practices, some as much as a 75% drop in patient count."

    Six weeks into his no-insurance model, Tomsett saw only 75 patients and managed to break even. 

    "I am able to spend more time with each patient than any other time in my career," he wrote.

    In a similar case in San Antonio, Texas, a pair of primary-care physicians made headlines when they stopped accepting third-party insurance a year ago. They told that they moved to a direct pay model because of the "expensive and bloated bureaucracy that drives financial reimbursements."

    A 2012 survey of more than 13,500 doctors from around the country found that 26% have already cut services for Medicaid patients due to costs, and within the next two years more than 50% plan to cut some patient access to their services. About 7% plan to switch to cash-only practices, like Ciampi's, or "concierge practices" in which patients pay doctors an annual retainer.

    What happens if more doctors follow Ciampi's lead and take matters into their own hands?  

    You've got a couple of options –– take your business elsewhere or pay the piper. Some insurers will offer partial reimbursements to out-of-network physicians, but the onus will be on you to deal with the paperwork involved.

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    woman doctor nasal spray sinus

    California's health care exchange released its 2014 premiums last week, and this week's big debate is over what we should think about them.

    Are they a huge increase over premiums in the individual market today?

    Or are they a great value because the plans in the exchange are comprehensive and cover people of all health statuses?

    Either way, what's happening in California is exactly what was supposed to happen: If you're young, healthy, and affluent, your insurance is getting more expensive. If you're old, sick, and poor, it's getting cheaper. That's because The Affordable Care Act — commonly referred to as Obamacare — is designed to be a fiscal transfer from the young to the old, the healthy to the sick, and the rich to the poor.

    It's not just Obamacare: Any system that shifts health expenditures from the private sector to the public sector causes transfers like this. If we had no government financing of health care at all, healthy people with high incomes would spend a very small percentage of their income on health care, and the sick poor would spend a large percentage. If we had a fully socialized system where the government paid for everything, rich people would bear most of the cost of providing health care to everyone. And systems that involve a split of public and private expenditure — including Obamacare — have distributional effects somewhere in between.

    What makes Obamacare's redistribution look odd, even "shocking," is that the law was structured to move much of the redistribution off the government's books. To reduce the need for direct, tax-financed subsidies, the law regulates the insurance market to ensure that it will have cross-subsidy: premiums for people who are older and sicker are held artificially low, while premiums for the young and healthy are inflated. Then other rules (including employer and individual mandates) aim to ensure that young, healthy people buy insurance despite the inflated the price.

    So, instead of hiding the transfer from the young and healthy as part of a tax bill that finances the whole government, Obamacare causes it to show up in the form of a higher insurance "premium." That tax increase will make some young and healthy people worse off. But they would also be worse off if the government provided direct health care subsidies to the old and the sick and used a broad-based tax like a payroll tax to finance those subsidies. In fact, that's how we finance Medicare, which is a huge fiscal transfer from the young to the old.

    So instead of being shocked that insurance prices will go up for the young and healthy, we should ask ourselves three questions about the transfers inherent in Obamacare.

    1. Are the transfers in Obamacare directionally desirable — do we want to move money from the young to the old, the healthy to the sick, and the rich to the poor? The arguments for the latter two are strong. The first is more dubious, but it's worth noting that every advanced country has a health care system with subsidies flowing from the young to the old. Switzerland, the country whose health care system most closely resembles the Obamacare exchanges, has no age-based rating at all, meaning young people there are dealing with much more rate shock than in California.
    2. Are the transfers in Obamacare efficiently designed — are they the right way to subsidize health care for the groups with the biggest needs? The answer to this, I think, is unclear. In some cases, Obamacare's system of indirect subsidies looks inefficient compared to direct tax financing. The employer mandate is likely to discourage job creation and cause employers to choose part-time employees over full-time ones. But a system of cross-subsided premiums plus an individual mandate may actually be an unusually economically efficient way of financing a universal health care benefit. Larry Summers wrote about this more than two decades ago — mandates look like lump-sum taxes that are very economically efficient but would be politically untenable if applied as explicit taxes.
    3. Are health care-related subsidies themselves efficient, or should we instead be giving poor people more cash? This question is harder than most conservatives take it to be. One reason to subsidize health care is that health care markets are inefficient, and giving people cash instead of health insurance may leave them unable to access care that they need. Another is that the likely political alternative to a universal health care benefit is not more generous cash transfers to the poor, but fewer total transfers to the poor.

    A lot of the claims about rate shock are overstated. Avik Roy says premiums under Obamacare are inflated by requirements to buy "a costlier plan with add-ons you neither need nor want." Well, that depends. If you're a woman who wants maternity coverage, the add-on may well be something you want, and the mandate for it to appear in everybody's plan will save you money.

    That is, among other things, Obamacare acts like a fiscal transfer to pregnant women from everybody else. And that's fine. But the transfers within Obamacare aren't set in stone and we'll be tweaking the rules that govern them for decades to come, so it's worth thinking about which transfers are warranted and which aren't.

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    Erick EricksonConservative pundit Erick Erickson doesn’t like me. This morning he wrote 900 words about why.

    But the main thing his post reveals is what’s wrong with Erickson – and with a Republican party that is built to appeal to people like Erickson.

    He starts by noting that I am “a late twenty-something gay male.” I’m not sure why my sexual orientation is mentioned right at the top of his hit piece on me, following only my age. (Just kidding; I know exactly why Erickson mentioned this so early.) But at least this statement, unlike some that follow it, has the virtue of being correct.

    For example, Erickson says I support “the tax hikes that come with Obamacare.” That’s not true; I wrote last July that Obamacare “should have been financed with efficient, broad-based taxes instead of singling out the wealthiest Americans.” He goes on to complain that I have “worked no campaigns.” That is not only false but contradicted by the same Atlantic profile that prompted Erickson to whine about me.

    He even almost got my name wrong. Erickson writes that he drafted the post referring to me as “John Barro,” as he has done in the past on Twitter, until a friend corrected him.

    Some of what Erickson says about me is true. I have never “answered to a constituency” as he did during his partial term as a member of the Macon City Council, which he resigned after missing 13 of 27 council meetings and 16 of 19 council work sessions in 2010. Like most Real Americans, Erickson had a poor attendance record because of his busy schedule of media appearances.

    But the bulk of the piece isn’t even really about me; it’s about Erickson’s resentment of New York- and Washington-based “elites.” He says our location makes it harder to “connect to the real world,” as though New York and Washington were not real places populated by real people.

    And for two decades, the Republican party’s strategy to overcome its disadvantage on economic issues has been a cultural appeal to people like Erickson: non-urban whites who feel threatened by social change. That is, the kind of people who think it’s an alarming trend that women are financially independent, or who think the most salient fact about a writer they dislike might be his sexual orientation.

    This is a strategic problem for Republicans for several reasons. One is that the party’s reliance on a resentment-based appeal has caused its policy apparatus to atrophy. Erickson is not alone among conservatives in thinking that “academic and technocratic” approaches are best left to pointy-headed liberals. Another is that people like Erickson are a declining share of the electorate.

    Basically, Erickson is derpy. And Erickson has big appeal to conservatives because lots of them are derpy. But the country is getting less derpy, and in time the Republican party will have to get less derpy, too. That’s my project, and I don’t expect Erickson to like it.

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    Late last week, a post by Avik Roy on possible increases to health insurance premiums in California went viral. So viral, in fact, that it was apparently Forbes' fastest ever to reach a million page views:

    It's pretty easy to see why. The headline asserts that the Affordable Care Act could drive individual insurance premiums in California up by as much as 146%, and contrasts with a report from California that showed that premiums would rise by less than what was expected. 

    While people don't understand the law particularly well, they do understand what they pay for health insurance. 

    One problem: That number, which was picked up by Drudge Report, The Daily Caller, and others, is misleading.

    Ezra Klein and Jonathan Cohn have more detailed explanations of why that is, but here it is in brief.

    In order to get that figure, Roy went to a website called, a marketplace for individual health insurance, and compared the cheapest plans there to the projected plans that will be offered in California's insurance exchange, a competitive marketplace for individuals to buy coverage.

    However, the plans he uses to compare offer what's called a "teaser rate"— one based on age without any knowledge of medical history. If you have pre-existing conditions, that premium goes up or you're ineligible. So the $92 median plan he comes up with isn't one that very many people would ever actually pay.

    A number of reviews found by Rick Ungar at Forbes of that particular provider said that quoted rates were nowhere near what people actually pay. 

    So if you're a 25-year-old in perfect health with a perfect medical history who doesn't get health insurance from your employer, but has an income in excess of $45,000 if single, or $96,000 with a family of four (there are subsidies available for people up to four times the federal poverty rate), you might be able to get that premium for a year, after which the provider is perfectly free to boost rates. 

    And while this theoretical person and other young, healthy, and wealthy people might see higher premiums, older, poorer, and sicker people will likely pay lower premiums than they do now. 

    There's a tradeoff there that's worth debating, whether those transfers are worthwhile or efficient.

    Premiums for some people are going to rise due to Obamacare. Some might rise a lot, provoking "rate-shock."

    California's figures, predicting anywhere between a 26% decrease in premiums to a 2% increase might be too low. But rates won't swing 100 plus percent in the other direction. And higher rates for some is exactly what the law is designed to create. 

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    marco rubio mad angry

    Senator Marco Rubio of Florida, who everyone expects to run for president in 2016, has proposed a bill that would amend the Constitution of the United States to prevent the government from enacting Obamacare. After 37 House attempts to revoke the bill in part or in full, Rubio has thrown in his lot with a far, far, far— really far — less likely strategy. Rubio is thinking about running for president.

    Rubio's office explains the plan at his website.

    [Rubio] proposed an amendment to the U.S. Constitution providing that “Congress shall make no law that imposes a tax on a failure to purchase goods or services.” The provision would effectively reverse the ObamaCare individual mandate tax and prevent future attempts to tax individuals and businesses for failing to purchase goods and services Congress has deemed mandatory to have. ...

    If passed by Congress and ratified by the states, the “Right to Refuse” amendment would reassert constitutionally limited government and exempt the more than 6 million individuals and businesses expected to be hit with thousands of dollars in mandate taxes set to begin in 2014.

    Rubio has a partner in the effort, Rep. Steven Palazzo of Mississippi, who introduced a similar bill in the House.

    If the House votes on Palazzo's bill, it would be the 38th time that the body has tried to repeal the Affordable Care Act since Republicans gained control in January 2011. We did a little data analysis, looking at how the first 36 of those votes went. Of all of the votes cast — some of which were in committees, not among the whole House — votes against Obamacare comprised 54.4 percent. Only a few votes saw a broad majority of support for curtailing the program. Those were usually tied to other funding proposals.

    But 54.4 percent will not help the Rubio/Palazzo amendment. The rules for amending the Constitution are set out in its fifth Article. There are two ways to propose an amendment. The first is by introducing it in Congress. The second is at a convention resulting from an appeal by two-thirds of the states. If it's done in Congress, as this one would be, it requires two-thirds support inboth the Senate and the House. If an amendment is successfully proposed, it requires state legislatures or states conventions in three-quarters of the states to approve it.

    So what are Rubio/Palazzo's odds?

    In the Senate: zero. The Senate is still controlled by Democrats. While they've been having some trouble overcoming Republican filibusters, they've had no trouble at all beating back Republican-led legislation. Particularly when it's an attempt to repeal the Democratic president's signature legislation. There have been 37 votes to repeal Obamacare in the House. There have been zero in the Senate.

    In the House: zero. Again: 54.4 percent is not 66.6 percent — a two-thirds margin. Republicans have a strong majority in the House, but it's still well short of two-thirds. Republicans would need to pick up another 57 House seats to gain that advantage.

    In fact, the last time the Republicans had a two-thirds majority in both chambers was the 43rd Congress. 1875.

    gop chart the atlantic

    In the states: a tiny, minute fraction above zero. Even if the amendment got out of Congress somehow, it would never be passed by three-quarters of the state legislatures as the Constitution mandates. Republicans have majorities in a number of states. They do not have majorities in 38 states — the required 75 percent. In 28 states they control both houses of the legislature. In 18, the Democrats do.

    But approving a constitutional amendment is not a light endeavor, and legislators are generally predisposed to oppose them. The last time an amendment came before the states for approval, it was a measure that would have given Washington, D.C., full representation in the Congress. Only 16 states approved it. The one before that was the Equal Rights Amendment. Same result.

    Given the odds outlined above, it's pretty safe to assume that this proposal won't go anywhere. In fact, it probably won't even come to a vote in the Senate, where it would need to be approved by a Democratically-led Rules Committee. So it is safe to expect that this idea will soon fade from public awareness and discussion.

    Until sometime in early 2015, at which point it might come up in a debate.

    Click here to follow The Atlantic.

    More From The Atlantic:

    Can Republican Governors Block Obamacare?

    Supreme Court Rules On Arizona's Immigration Law; No Health Care Decision

    The IRS Is The New Death Panel During The 37th House Vote To Repeal Obamacare

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    Obamacare has survived a ferocious TV advertising assault from opponents that dwarfs ads defending the law by a 5:1 ratio, according to a new analysis by a media monitoring group.

    Spending on campaign and issue ads referencing Obamacare in the three years since the law’s enactment on March 23, 2010, totals a whopping $475 million, Kantar Media’s Campaign Media Analysis Group found.

    Ads mentioning the health care law were “overwhelmingly negative” — coming in at $400 million as compared to $75 million spent portraying the law positively, the study said. Spending on such ads exceeded $250 million in 2012.

    “The biggest advertisers in opposition to the ACA since its enactment have been Republican outside groups,” the Kantar analysis concluded. “The biggest advertiser in support of the law has been the US Department of Health and Human Services in a nonpolitical (judging from the buy) education campaign.”

    Meanwhile, Kantar found, “Democratic candidates for office — including President Obama himself — have spent comparably little on campaign and issue advertising about the law.”

    The lopsided nature of Obamacare-related TV advertising may offer some context to the law’s unpopularity in polls. A CNN survey last week found that 54 percent of Americans have an unfavorable opinion of the law, compared to 43 percent who view it favorably.

    The gap illustrates the challenges facing the Obama administration and other proponents of the law as they fend off Republican efforts to sabotage the health care law’s implementation. Democrats say they’re increasingly dedicated to making sure the roll out of the law’s major provisions next year goes well.

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    Barack Obama health care Obamacare

    More Americans than ever view President Barack Obama's signature health-care legislation negatively, according to a new Wall Street Journal/NBC poll.

    The poll, which was released on Thursday, found that 49 percent of respondents view the Affordable Care Act as a "bad idea." That's the highest mark ever recorded in the poll, which has been tracking Americans' views of "Obamacare" since April 2009, when it was being debated.

    A record amount of respondents — 38 percent — also said that the law would make the country "worse off." Only 19 percent think it will make the country "better off." 

    The brutal poll numbers come as Obama makes his first big public push on the law in San Jose, Calif., where he will make a statement to highlight how the state is, so far, successfully implementing the law. 

    Two weeks ago, providers unveiled insurance plans in California's health care exchange that range from a 2 percent increase to a 29 percent decrease in premiums, compared to current insurance rates. Though there has been some controversy over how to analyze these numbers, California shows that the law is working as it was intended.

    But the public still seems largely skeptical. According to the WSJ/NBC poll, people who believe Obamacare is a "good idea" has not outpaced those who think it is a "bad idea" since June 2009. 

    Here's a chart that shows the progression of people's opinions:

    Obamacare poll

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    startup guys happy workers friendsIn January, one of Obamacare's most controversial provisions will come into effect:

    Every person in America will be required to either have health insurance or pay a penalty.

    Overall, the effect will likely be a net positive: Because of subsidies, the cost of insurance will be kept down for many households, and in many states, a Medicaid expansion will help even more families pay for their health care. But while the outlook is great for millions of workers, things are going to be tougher for at least one group: healthy, financially secure men in their twenties.

    So, guess which group Obamacare critics have focused on when they attack the effects of the program? I'll give you three guesses, but you'll probably only need one.

    On Wednesday, New York magazine's Jonathan Chait pointed out the surprising trend, noting that critics of the Affordable Care Act have almost universally cited the group in their attacks. Likening the move to an old-time patent medicine show ("You, sir - the healthy 25-year-old in front who has never been hospitalized or needed medication in his life! Step right up!"), he suggested that the attacks on Obamacare are, to put it mildly, skewed.

    On the surface, targeting the law's impact on healthy 25-year-old men seems like a masterstroke. After all, it's hard to argue for the fairness of a system that charges healthy young people to pay for the health care needs of sickly older ones. The trouble is, today's healthy 25-year-old male could easily become tomorrow's hit-and-run victim, desperately in need of long-term medical care. And, barring that, today's healthy 20-something will, with any luck, become a less-healthy 50-something, in need of an affordable method to cover his medications and regular doctor's visits.

    (Or, as happened to me when I was an uninsured man in my mid-20s, today's healthy young 25-year-old could be tomorrow's guy paying out-of-pocket for wisdom teeth extraction.)

    Obamacare has numerous provisions that will extend coverage and make health insurance cheaper. Among other things, it will help cover the Medicare Part D coverage gap, will end exclusions for pre-existing conditions, and will require health care plans to cover preventative care.

    For tens of millions of people, these provisions, and others, will translate into lower medical costs, a previously unimaginable access to health care, and a generally improved quality of life. Given the huge potential benefits, maybe it's time for Obamacare's critics to stop shedding crocodile tears for the relatively small portion of the populace that is going to have to take one for the team -- and, in the process, get insurance that may well make them safer and healthier.

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    tanning bed

    It's official: That trip to the tanning bed is going to keep costing you a little extra.

    Monday, the IRS definitively ruled it is going to keep a 10 percent sales tax on tanning salons in tact. The tax, which is part of the Affordable Care Act, was created to help offset the cost of insuring more Americans and raise $2.7 million over the next decade.

    [BROWSE: Political Cartoons on Health Care]

    Last year, a British Medical Journal study found that 5 percent of melanoma cases reported in Europe were caused by tanning. The study also found that individuals who regularly got their rays from tanning beds were 20 percent more likely to get the deadly skin disease.

    The regulation, which was already being collected on a trial basis, requires that indoor tanning businesses add a 10 percent excise tax on top of their cost.

    Under the law, gyms that have tanning beds, but do not rely on them for the majority of their business, are exempt from collecting the tax.

    [HEALTH: How to Tan Safely]

    The Indoor Tanning Association, a group that represents tanning bed manufacturers and business owners says that the tax is cutting into business and unfairly exempts gyms.

    "The IRS is picking winners and losers in the industry," says John Overstreet, the ITA's executive director.

    Since 2010, the Indoor Tanning Association says a bad economy, coupled with the tax, has led to more than 1,000 business closures.

    "If you are struggling to begin with and then you have the federal government taking 10 percent of your profit, a lot of these businesses just cannot survive," says John Overstreet, the group's executive director.

    [OPINION: The Tanning Tax and the New Healthcare]

    The group says that it will continue to fight to remove the tax.

    Rep. Michael Grimm, R-N.Y., introduced a bill to stop the tax in 2011, but has yet to reintroduce it this year.

    The Indoor Tanning Association is also working with Ways and Means Chairman Dave Camp, R-Mich., to erase the tax through comprehensive tax reform.

    More News:

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