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GOP Plan To Trim Insurance Benefits Might Not Tame Premiums

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There are plenty of reasons to vote “no” on Measure 101, the referendum on new taxes to fund Oregon’s Medicaid program. The sheer inequity of asking college students, K-12 school districts and small businesses to shoulder the cost of an essential program while exempting others is one of the biggest reasons The Oregonian/OregonLive Editorial Board recommended that Oregonians vote “no” and demand that the Legislature deliver a better solution.

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Voters, of course, may well disagree. But they should base their decision on facts, not on inaccurate or misleading information peddled by those supporting the “yes” side. Here’s a look at a few of the claims that deserve some truthsquadding.

Claim No. 1: Tax, schmax. The funding mechanisms in Measure 101 are “fees” and “assessments.”

The provisions in Measure 101 — a 0.7 percent tax on hospitals and a 1.5 percent tax on select health-care premiums — are, without question, taxes. That’s how the Legislature characterized it in voting on the funding package in 2017. And lawmakers aren’t the only ones who used the word “tax.” The governor’s office, state agency leaders, legislative revenue analysts, legislative fiscal analysts, Medicaid providers, labor unions, nonprofit supporters of the measure as well as the measure’s opponents all routinely referred to the provisions of the funding package as “taxes.” Because that’s what they are.

Yet, you won’t find that word anywhere in the ballot measure title and description, which was written by a committee of four Democratic legislators and two Republican legislators. Instead, the title uses the less-specific term “assessment.” It’s still, however, a tax.

Claim No. 2: Fine. It’s a tax. But those responsible for paying it think it’s a fantastic idea.

Well, let’s take a closer look at who actually pays the tax. Take Section 5 of HB 2391, the Medicaid funding bill, which says “insurers” will pay the state 1.5 percent of the gross amount of premiums that they collect from customers. The bill, signed into law last year by Gov. Kate Brown, also explicitly notes that those insurers “may increase their premium rate on policies or certificates that are subject to the assessment under section 5 of this 2017 Act by 1.5 percent.”

Insurers not only “may” increase their premiums. They already have. A spokesman for the Department of Consumer and Business Services said the agency has already added the 1.5 percent increase into insurers’ authorized 2018 rates in the individual and small-group market.

Who are the customers footing the tax? Thousands of college students who are required to buy health insurance offered through their schools, small businesses that provide health plans for their employees and others who buy their insurance through the health exchange. The law also levies the premium tax on K-12 school districts and the Public Employees Benefit Board.

Meanwhile, the tax does not apply to Nike, Intel and other large employers (including The Oregonian) that administer a self-insured program, nor to seniors and others who are federally protected from the state-imposed tax.

Claim No 3: There’s no Plan B.

The argument from some on the “yes” side is that Oregonians should endorse the new taxes because the state has no back-up plan. But that ignores the fact that the Legislature actually moved the Measure 101 election to January for the express purpose of giving themselves a chance to develop a Plan B in the short legislative session if voters reject Measure 101.

Additionally, Reps. Julie Parrish and Cedric Hayden, who spearheaded the referendum effort, have already offered funding alternatives that could make up at least some of the gap. For example, legislators could replace much of the money raised by the 0.7 percent hospital tax in Measure 101 with an increase in Oregon’s existing method of hospital assessments for Medicaid.

Claim No. 4. Defeat of the measure jeopardizes $5 billion in federal funds.

The Yes on 101 campaign argues that the loss of $210 million to $320 million in state revenue would risk $5 billion in federal funds. This isn’t however, what the state’s budget actually shows. As the financial impact estimate notes, those state funds are tied to $630 million to $960 million in federal funds - not $5 billion. The $5 billion figure is a worst-case scenario based on speculation that the Legislature might simply cut the expanded Medicaid population entirely and forgo matching federal funds rather than identify alternate revenue, trim patient benefits, reduce provider costs or otherwise respond.

Claim No. 5: Forty-nine states use “the same types of assessments” to fund health care.

That depends on how broad your definition of “same types of assessment” is. While every state except Alaska collects assessments from health-care providers, few states levy a tax on health care premiums, according to Rachel Garfield with the Kaiser Family Foundation, which tracks how states fund Medicaid.

It’s now up to voters, who have until Jan. 23 to get their ballots in. Those who believe the Legislature can and must do better than this deeply inequitable plan should mark their ballots “no.”


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Source : http://www.eastoregonian.com/eo/editorials/20180116/our-view-measure-101-debate-needs-to-be-based-on-facts-not-fear

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