Friday, May 27, 2016

IRS Doubted Legality of ObamaCare Payments But Made Them Anyway After Meeting with Administration

From the Hill:
The IRS raised concerns in early 2014 about the legality of certain ObamaCare payments that Republicans are now challenging in a lawsuit, according to a deposition from a former agency official.

David Fisher, who was the IRS’s chief risk officer, told the House Ways and Means Committee that agency officials questioned whether the Affordable Care Act provided the authority to make certain payments to insurers without an appropriation from Congress.

Most senior IRS officials ended up concluding that the payments were legal after a meeting with the White House to hear its legal justification, and the administration eventually went ahead with disbursing the funds.

The Treasury Department declined to comment on the deposition, citing the litigation.

Those payments, called “cost-sharing reductions,” are the subject of the lawsuit by House Republicans against the administration. A federal judge ruled this month that the administration overstepped its authority by making the payments without an appropriation from Congress, though the ruling will be appealed.
According to Fisher, IRS officials questioned whether the healthcare reform law provided a "permanent appropriation" for the payments. The text of the law clearly provides one for ObamaCare’s tax credits, which help people pay insurance premiums, but does not specifically provide one for the cost-sharing reduction payments, which help people afford their deductibles.  
The administration went on to argue that the same authority that provides for the tax credits also covers the cost-sharing reductions because the structure of the law links the two “inextricably.” 
But in early 2014, the IRS, which is responsible for distributing the payments, pointed out the lack of an explicit appropriation for the cost-sharing reduction. ...

Wednesday, May 25, 2016

Understanding Employer Notices From Covered California and Similar PPACA Exchanges/Marketplaces

This is from Holland & Knight LLP:
For the first time, in 2016 some employers will receive a notice from a Marketplace indicating that one of their employees signed up for health coverage through the Marketplace and received advanced premium subsidies. ...
During the Marketplace application process, individuals are asked a host of questions, including questions about access to health coverage through an employer. If the Marketplace determines that the individual does not have access through an employer to coverage that is affordable and meets the required minimum value, and assuming the individual meets other eligibility criteria, advance payments of the premium tax credit can begin.
In such an instance, the Marketplace is required to send the employer a Marketplace notice. ...
Potential Tax Liabilities
The Marketplace notices will give employers advance warning that they may have potential tax liability under the employer mandate of the ACA. However, there are reasons that receiving a notice does not necessarily mean the IRS will be in hot pursuit, including:
  • The Marketplace cannot distinguish whether the employer is large enough to be subject to the employer mandate....
  • Even if the employer is an applicable large employer, the individual identified in the notice may not be a full-time employee. Determining whether a particular employee is a full-time employee, as defined by the law and related regulations, is not always easy. An employer receiving a Marketplace notice may want to confirm whether the individual identified in the notice is an employee and whether, in fact, the employee was, or is, a full-time employee.
In addition to considering its potential tax liability under the employer mandate, an employer should also be mindful of its employees' potential tax liability. As noted above, an individual with access through an employer to health coverage that is affordable and meets minimum value is not eligible for a premium tax credit. Consequently, any advance payments of the premium tax credit made on that individual's behalf throughout the year will be subject to repayment when the individual files their income tax return....
Sample Notice Clarifications 
The FFM [Federally Facilitated Marketplaces, i.e., about half of the states but not California] recently posted a sample of its 2016 notice. The sample notice contains language that requires clarification:
  • First, it states, "Certain employers ... might have to pay an employer shared responsibility payment for any month that at least one full-time employee enrolled in Marketplace coverage and receives APTC [advanced payments of the premium tax credit] or CSRs [cost sharing reductions]." Whether or not there is tax due to the IRS is dependent on whether a full-time employee receives a premium tax credit – not, as the notice suggests, advance payment of the premium tax credit and cost-sharing reductions. There could be several reasons why an individual is determined eligible for advance payments of the premium tax credit by a Marketplace but is not eligible for the premium tax credit. This might happen for example, if the individual had higher-than-expected income.
  • Second, the notice states, "Filing an appeal could also eliminate reports from the Marketplace to the IRS that your employee received APTC or CSRs following an appeal decision in your favor." Although the IRS receives reports from Marketplaces during the year indicating how much in advance payments were made on an individual's behalf, the notice is misleading to the extent that it implies the IRS will be notified of an employer appeal or the outcome of such an appeal.
  • Finally, the notice suggests that employers should call the IRS for more information. While the IRS has an abundance of general information on its website, IRS telephone assistors will be unable to provide information on the Marketplace process, including the appeals process, and will be unable to tell an employer whether they owe a tax under the employer mandate.
Considerations for Employers 
An employer who receives a Marketplace notice may want to appeal the decision that the individual was not offered employer coverage that was affordable and of minimum value. An employer has 90 days from the date of the notice to file an appeal, which is made directly to the Marketplace. Importantly, the IRS will independently determine whether an employer has a tax liability, and the employer will have the opportunity to dispute any proposed liability with the IRS. Similarly, an individual will have the opportunity to challenge an IRS denial of premium tax credit eligibility. Any contact by the IRS, however, will occur late in the game after the year’s tax liabilities have already been incurred. Therefore, although an appeal is not required, it may be advisable. ...

How to Determine the Full-Time Status of Ongoing Employees Under PPACA's Lookback Method When Employee Leave is Taken

Generally, an employee does not have to be credited with hours of service for any period in which they are on an unpaid leave.  However, a special rule applies for employees who are on FMLA leave, USERRA leave or jury duty (referred to as “special leaves”).  During periods of special leave, an ALE has two options for crediting service.  The ALE can disregard the period of special leave and only measure the hours of service during the period prior and after the leave.  Alternatively, the ALE can credit the employee with the average hours worked, prior to the leave, over the period of the special leave.  
For example, Bob Jones is considered a full-time employee for the 2016 stability period.  Bob is on an unpaid FMLA leave for 4 weeks beginning March 1, 2016.  This unpaid leave does not impact Bob’s status as a full-time employee in 2016.  When the ALE determines whether Bob is a full-time employee for the following stability period (2017), the ALE takes Bob’s total hours during the measurement period and divides them by 48 weeks (52 weeks minus the 4 week leave).  If Bob averaged enough hours to be considered full-time during the 48 week period, the ALE must offer Bob coverage for the subsequent stability period to avoid the potential of pay or play penalties.

New York's Obamacare Exchange Premium Increases Ballooning

In 2015, insurers in New York requested premium increases of 12.5%.  State regulators only approved 5.7%.

In 2016, insurers requested 10.4%.  Regulators approved 7.1%.

Now, for 2017, insurers have requested 17.3%.

  Source: Bob Laszewski.

This does not factor in the additional metric of plan degradation, either.  Many folks are now seeing the brutal financial impact of deductible, copay and coinsurance inflation.

Call me crazy, but this certainly doesn't look like a $2,500 decrease per family.


Wednesday, May 11, 2016

Next Discrimination Claim: Your Company Sponsored Wellness and Weight Loss Initiatives?

There is hardly any crowd I struggle to understand more than the subculture of delicate, wincing snowflakes on today's college campuses.  Whether it be microaggressions, safe rooms, trigger warnings, free speech zones or emotional support animals, today's colleges spawn the opposite of durable, rugged, individualism.  Instead, the most offended and and aggrieved are elevated to the most exalted protected class.  Against this backdrop, we have this from HeatStreet.  And no, this is not the Onion.  What is even scarier is that these folks are headed into your workplace. It is only a matter of time before a company is sued for this hateful, discriminatory behavior.

... In celebration of “International No Diet Day,” [the University of Minnesota's] school of public health ... invited Virgie Tovar, a self-proclaimed “fat activist,” to instruct America’s future nutritionists, dietitians and social workers on the finer points of “fat oppression.”
Tovar’s talk, entitled “Dispelling Myths: Fat, Fatphobia, and Challenging Social Stereotypes,” was designed to help students understand that “fat phobia” is rampant in a “white, heteronormative society” that is looking to actively oppress people with larger body types. Society’s bias against fat people is, apparently, a form of bigotry and discrimination, evident in everything from sexual preferences to the size of seats on public transportation. 
She even, reportedly, compared society’s anti-fat culture to so-called “rape culture,” and chastised society for its obsession with what she termed “thin privilege.” 
According to Tovar, the students, who study public health (at one of the top 10 schools for public health), shouldn’t push people they deem overweight to shed pounds, even if it’s better overall for health. “Weight loss is not a realistic goal for most people,” she said, declaring that exercise and diet are “social constructs.” She implored her audience to “lose hate, not weight” and rebel against “diet culture.” (Diets are, of course, just a tool of the hetero-normative Patriarchy.) ...
No surprise, Tovar, who lists her occupation as “fat activist,” has a Masters in Human Sexuality—with a focus on the “intersection of body size, race and gender”—and taught at the University of California, at Berkeley, where that is considered an actual academic field of study. ...
Full text: ‘Fat Activist’ Speaks at Public Health School, Denounces ‘Thin Privilege’ by Emily Zanotti at HeatStreet.

Monday, May 9, 2016

Study: Anti-Harassment Training Could Be Increasing Harassment

Yet another example in the cascading reality of unintended consequences. No good deed goes unpunished.  In California, employers with 50 or more employees are legally required to provide at least two hours of harassment prevention training every two years.  Yet the leading research on the topic is now showing that these trainings are having the opposite effect by stoking harassment claim fears and fostering resentment.  

[N]ew research reveals that sexual-harassment training may have an opposite effect on employees by "making men less capable of perceiving inappropriate behavior and more likely to blame victims."...
[Justine] Tinkler [assistant professor of sociology at the University of Georgia, and co-author of a study that found after men took harassment training, their gender biases were frequently reinforced] has also done research on how these trainings can actually ignite backlash. Men who already feel that women are "emotional and duplicitous in the way that they both want sexual attention, but don’t want sexual harassment" can get their feelings confirmed in sexual harassment training.
Julia Edelman, a professor of law and sociology at UC Berkeley who has done research on the inefficiency of sexual-harassment training, said that one reason for this could be that sexual-harassment training often features "cartoonish, somewhat unrealistic" examples of harassment in the workplace. “We really need more research on what works. All we really know about sexual harassment training is that it protects employers from liability. We don’t know whether it protects employees. We don’t know whether it reduces sexual harassment."...
From the Guardian
Studies testing the effects of harassment training are very limited, but some research has suggested counterintuitive and troubling consequences – that after men complete trainings, they may be more inclined to brush aside allegations and discount victims. ...
One Journal of Applied Behavioral Science study that evaluated a sexual harassment program for university employees found that men who participated in the training were “significantly less likely” to consider coercive behaviors toward a subordinate or student as sexual harassment compared with a control group of men who hadn’t done the training. ...
Other studies have shown that when workplaces actively inform men of sexual harassment policies, it can also have unintended negative effects. A study published in the Social Psychology Quarterly found that after men learned about harassment rules, it triggered implicit gender biases, effectively making it more likely for them to stereotype women. 

Wednesday, May 4, 2016

Medical Errors Are Now the Third Leading Cause of Death in the United States

From the Washington Post:
Nightmare stories of nurses giving potent drugs meant for one patient to another and surgeons removing the wrong body parts have dominated recent headlines about medical care. Lest you assume those cases are the exceptions, a new study by patient safety researchers provides some context. 
Their analysis, published in the BMJ on Tuesday, shows that "medical errors" in hospitals and other health care facilities are incredibly common and may now be the third leading cause of death in the United States -- claiming 251,000 lives every year, more than respiratory disease, accidents, stroke and Alzheimer's. 
Martin Makary, a professor of surgery at the Johns Hopkins University School of Medicine who led the research, said in an interview that the category includes everything from bad doctors to more systemic issues such as communication breakdowns when patients are handed off from one department to another. ...

Monday, May 2, 2016

How Wellness Programs and "Biggest Loser" Approaches to Weight Loss Could Semi-permanently Compromise Metabolism

The Brutal Reality of How Difficult It Is to Keep Unwanted Pounds Off After a Diet
  • 13 of the 14 contestants regained weight in the six years after the "Biggest Loser" competition
  • 12 of the 14 contestants appear to have a permanently or semi-permanently degraded metabolism
  • About one-third of contestants are now heavier than before going on the show
  • Bariatric surgery patients appear to generate a new, set-point for their weight within one year after surgery; 
    • one sixth the time it takes for strict diet and exercise 
    • meaning at least five more years of Leptin imbalance and supercharged hunger cravings

In 2009, contestants on NBC's Biggest Loser lost hundreds of pounds.  But they gained those pounds back.  A 6-year study of their struggles illuminates some frightening new findings about just how much of an uphill struggle it is to keep off unwanted weight.  This is from the New York Times:
[M]ost of that season’s 16 contestants have regained much if not all the weight they lost so arduously. Some are even heavier now.  
Yet their experiences, while a bitter personal disappointment, have been a gift to science. A study of Season 8’s contestants has yielded surprising new discoveries about the physiology of obesity that help explain why so many people struggle unsuccessfully to keep off the weight they lose. ... 
“It is frightening and amazing,” said Dr. Hall, an expert on metabolism at the National Institute of Diabetes and Digestive and Kidney Diseases, which is part of the National Institutes of Health. “I am just blown away.”
It has to do with resting metabolism, which determines how many calories a person burns when at rest. When the show began, the contestants, though hugely overweight, had normal metabolisms for their size, meaning they were burning a normal number of calories for people of their weight. When it ended, their metabolisms had slowed radically and their bodies were not burning enough calories to maintain their thinner sizes. 
Researchers knew that just about anyone who deliberately loses weight — even if they start at a normal weight or even underweight — will have a slower metabolism when the diet ends. So they were not surprised to see that “The Biggest Loser” contestants had slow metabolisms when the show ended. 
What shocked the researchers was what happened next: As the years went by and the numbers on the scale climbed, the contestants’ metabolisms did not recover. They became even slower, and the pounds kept piling on. It was as if their bodies were intensifying their effort to pull the contestants back to their original weight.
The entire story and accompanying graphs are riveting.  It goes on to show that even now, six years later, contestants bodies burn fewer calories at rest than they did before the show.  Their bodies have engaged in a continual revolt against the weight loss. These folks now need to eat anywhere from 400 to 800 calories a day less than a typical person of their size just to avoid gaining weight.  It is a sort of permanent metabolic handicap.

The ultimate conclusion is that once the weight is lost, a dieter must be even more vigilant than they were during the initial weight-loss phase.  And perhaps the most unnerving observation is that the only folks who succeed in keeping weight off are the ones who can just constantly live with being hungry and not succumb to those cravings - ever

This study showed that 13 of the 14 contestants regained weight in the six years after the competition. Four of those 13 are heavier now than before the show.  Similarly 12 of the 14 contestants have slower metabolisms today than they did six years ago, and burn fewer calories than expected (compared to other people of the same size) when at rest.

It's important to remember, however, this study investigates what happens after one engages in an extreme diet and exercise regime to lose significant weight quickly. The body fights vehemently to put that weight back on for as long as six years (could be for even longer or forever, but the study only addressed the six-year timeframe). What this study doesn't address is whether a slow sustained increase in exercise and better eating that leads to more gradual weight loss would have the same effect.

More on the story:
    Yoni Freedhoff is an obesity specialist (and critic of the Biggest Loser approach) who was not involved with either study. In an interview, he observed that, "The bariatric surgery patients saw the metabolic adaption reverted after about a year [as opposed to after 6+ years with the "Biggest Loser" approach, signaling just how destructive extreme diet and exercise are to metabolism]. So it would appear that the Biggest Loser-style weight loss is devastating to a person's metabolism compared to surgery." ...
    What isn't clear is whether a more gradual, non-surgical approach to weight loss would lead to the same outcome that the researchers found in the present study. "We don't have studies on people who slowly lost 40 percent of body weight and then tracked their metabolisms years later," Freedhoff said. "But we definitely know at this point that theBiggest Loser-style of weight loss is incredibly bad for a person's metabolism." ...
In contrast, a matched group of ... gastric bypass surgery patients who experienced significant metabolic adaptation 6 months after the surgery had no detectable metabolic adaptation after 1 year despite continued weight loss. It is intriguing to speculate that the lack of long-term metabolic adaptation following bariatric surgery may reflect a permanent resetting of the body weight set-point. 
Hat tip: to artist and good friend, Paul Hermann.