Dec. 8: ACA repeal would be disaster for Louisiana

Dec. 8: ACA repeal would be disaster for Louisiana

More than half a million Louisianans would lose health insurance coverage if the Affordable Care Act is repealed. This would be terrible news for those who would lose coverage, but also for the state’s finances. The state would lose $2.3 billion in 2019 alone and $26.7 billion from 2019 – 2028, putting further strain on the state budget. These numbers come from a new analysis from The Urban Institute. A state fact sheet from the Center on Budget and Policy Priorities breaks down the bleak picture for Louisiana if repeal moves forward.

Moderate-income working families in Louisiana would lose substantial financial assistance that is now available to help them pay their premiums and cost-sharing for insurance purchased in a marketplace. In 2016, Louisianians who enrolled in marketplace coverage receive an average advance premium tax credit of $362, which covers 81% of the total monthly premium for comprehensive coverage.

Nationwide, some 30 million people would lose health coverage. Of particular note: 4.3 million people would lose their coverage immediately (even if repeal was delayed 2 – 3 years) because of disruptions in the health market. Uncompensated care costs would also skyrocket.

In addition, the growth in the number of uninsured residents would increase demand for uncompensated care by $1.1 trillion nationwide between 2019 and 2028. Assuming fixed federal spending on uncompensated care, state and local governments and health care providers would have to bear this cost.

Health reform efforts should work to make coverage more available and affordable. A repeal bill without a replacement would be devastating. Yet, as AP star reporter Melinda Deslatte explains, this troubled outlook wasn’t on the mind of legislators during a House Appropriations hearing on health care.

There was little discussion of the holes that could be created in Louisiana’s budget if President-elect Donald Trump and GOP leaders in Congress are successful in repealing President Barack Obama’s health overhaul – and taking with it the Medicaid expansion money. More than 350,000 have enrolled in Louisiana’s Medicaid expansion since the budget year began July 1, and the health department estimates that will grow to 417,000 by June 30. “Medicaid expansion was a godsend for our budget,” (Louisiana Health Secretary Rebekah) Gee said.


Learning from experience on health care

The state of Rhode Island pursued many policies that have found their way into congressional ACA “replacement” plan drafts. The major problem: it’s hard to balance the “risk pool”- the mix between healthy and sick people- in a purely voluntary system. Those with health issues are the most likely to buy coverage, while healthy people will opt out … until they get sick. This will lead to higher overall premiums. Christopher Koller writes about the Rhode Island experience in Politico:

In Rhode Island, as elsewhere, our sought-after healthy population comprised the majority of the uninsured, and they were taking an economically rational risk to forgo coverage — at the expense of the older and sicker people left in the pool and insured populations who paid for their uncompensated care when they incurred it. No amount of tweaking of benefits and cross subsidies would cause them to reverse their decision. As Mitt Romney, then governor of Massachusetts, and his colleagues were teaching us, a combination of premium subsidies, an individual mandate, and aggressive outreach were needed to persuade these “young healthies” to purchase insurance.


Decision on overtime rule nonsensical

Last week, a judge blocked implementation of a rule from the U.S. Department of Labor that will result in a loss of $570 million for American workers, according to the Congressional Budget Office. The rule would have updated the salary threshold for overtime pay eligibility to just over $47,000 per year. A little history: in 1938 Congress passed the Fair Labor Standards Act which, among other things, established overtime pay of 1.5 times regular pay (“time and a half”) for eligible workers who logged more than 40 hours in a week. Since that time, the Labor Department has determined eligibility through a salary and duties test. The law is supposed to exempt “bona fide executive, administrative, and professional capacit[ies].” Without a salary test, however, it’s extremely difficult to parse out who fits this category. The Labor Department set the first salary threshold in 1938 but did not provide for an inflation adjustment so it’s been up to the department to update it from time to time. As Jared Bernstein explains at, the ruling is hard to decipher since the judge ruled the salary test ok, just not in this instance.

The salary test’s history clearly shows that it is central to the understanding of the overtime standard. Millions of workers — men and women who were just about to get paid for working extra hours for which they should have been paid a premium for years now — depend on a higher-level court reversing this nonsensical ruling on appeal. (Consider how much time and energy could have been saved if the salary threshold had been indexed to inflation from the start, a sensible move whenever government benefits or protections are tied to salary or wages. Another obvious case is minimum wage laws.)


Gov. Edwards to push for more flood relief funding

Congress approved another $1.25 billion for flood recovery efforts. As estimates of damage stand at $8.7 billion, Gov. John Bel Edwards pledged to push for additional funds next year. The Advocate’s Elizabeth Crisp has the story:

“Make no mistake, we will return to Congress in the Spring to ask for additional assistance to complete our package,” Gov. John Bel Edwards said this week. “Louisianans deserve nothing less than a full recovery, and my administration won’t stop until we are able to secure that. I look forward to continuing to work with the Louisiana delegation, as well as the Trump Administration, to get the assistance we need next year.” Congress is expected to approve the $1.25 billion when it finalizes a stop-gap spending measure by Friday to prevent a government shutdown. In September, Louisiana secured $437.8 million in a similar measure, which leaders at the time described as a “down payment” on future funds.


Number of the Day

558,000 – Number of Louisianans who would lose health coverage if ACA is repealed (Source: Urban Institute via Center on Budget and Policy Priorities)