“Federal courts are courts of limited jurisdiction,” the acting United States solicitor general explained to the Supreme Court in a 1990 argument. “The presumption is that they are without jurisdiction, and the plaintiff must affirmatively prove that he has standing to invoke the power of the court.”

That’s a quote from Supreme Court Chief Justice John Roberts – given that Roberts and his fellow Justices will be ruling on the suit that seeks to disallow subsidies for policies obtained via the Federal health exchange, it has special meaning.

The suit, funded by the Koch-backed Competitive Enterprise Institute, is ostensibly being brought by four plaintiffs who, in theory, have to prove they were harmed in order to have “standing”.  In a nutshell, “standing” means that if you aren’t harmed by an action, then you can’t complain about it.  I may not like the speed limit in Hawaii, but since I never go there I have no standing to sue.

As several news outlets have reported, three plaintiffs don’t have much to complain about; this from the Wall Street Journal:

Legal experts say the fact that Mr. King could avoid paying the penalty for lacking insurance by enrolling in VA coverage undermines his legal right to bring the case, known as “standing.” The wife of a second plaintiff has described her husband on social media as being a Vietnam veteran. The government previously questioned the standing of a third plaintiff on the grounds that her income may exempt her from paying the penalty for lacking insurance, but a lower court didn’t address the issue.

The fourth plaintiff, Brenda Levy, is Medicare-eligible in June of this year – about the time the Court would rule on the case.  As I am NOT a legal scholar or lawyer, and don’t even watch legal shows on TV, I’m not qualified to say whether Medicare eligibility changes “standing” (Medicare recipients can’t be forced to carry insurance under PPACA as they are covered by Medicare).  If it doesn’t, then the case will go forward as even one plaintiff with standing is enough.

That said, this Court seems – to my uneducated eye – to use “standing” to avoid ruling on contentious issues.

What does this mean for you?

Hard to say, as handicapping this Court is a fool’s game.

An enterprising journalist located the 4 individuals so harmed by PPACA that the Competitive Enterprise Institute is taking their case, now known as King v Burwell, to the Supreme Court.

Two of the four qualify for hardship exemptions – that is, because even the cheapest PPACA plan would cost them more than 8 percent of their income, so they are exempt from the individual mandate.

“King” in King v Burwell is one of these two; he’s an uninsured 64 year old smoker who will soon be on Medicare.  Mr King is somewhat ill-informed about “Obamacare”, but as his income is low, he avoids the individual mandate.

The other, Rose Luck, is, if anything, even less informed about Obamacare; she warned her Facebook buddies Obamacare will “cost some people 77,000 dollars a yr.” While she won’t be required to buy insurance, Ms Luck is no fan of the person whose name is used to label PPACA; she did call the President the “anti-Christ” and said Obama was elected by getting all “his Muslim people to vote for him.”

I don’t see how these two worthies were actually “harmed”, as in, suffering any material or measurable or painful or negative consequences, from PPACA

Brenda Levy is also few months away from qualifying for Medicare, has actually never attended any of the court proceedings, and, when told that her suit could eliminate health insurance coverage for several million fellow citizens, was kind of upset, saying “I don’t want things to be more difficult for people…I don’t like the idea of throwing people off their health insurance.”

(about 8.2 million Americans will likely lose coverage if King wins)

Still, she doesn’t like Obamacare, even though she could have bought a plan for $148 at a time when she claimed her premiums were $1500 a month…

Which brings us to the fourth litigant, Doug Hurst of Virginia Beach VA. Although Mr and Mrs Hurst too would have qualified for a very large subsidy, Ms Hurst is vehemently anti-Obamacare.  When approached by the reporter, she would not provide any insights into her position or rationale.

Still, Mr Hurst and Ms Levy at least seem to have the legal “standing” to claim PPACA has somehow harmed them.  I don’t see how the other two litigants can, as they aren’t required to do anything due to their low income status.

So here’s my question.  Is this the best group of litigants the Koch-backed CEI could come up with?  How about someone who had to change health plans, or an employer mandated to offer coverage? A provider affected by lower reimbursement perhaps?

There’s no question PPACA can be improved; there’s also no question many opponents’ blind fury makes for pretty crappy strategy.

What does this mean for you?

CEI is little better than Hurst, King, or Luck – ill-informed ranters who don’t have any idea what they are litigating.  Of course, CEI does have the dollars to bring a case that may well cost 8.2 million Americans their health insurance.

There’s much confusion, conflation, and outright nonsense out there about “Obamacare” and the implications and effects thereof, most of it based on a lack of understanding, and a lot of that seemingly willful.

This was brought home in recent conversations with friends; one on the board of a local hospital here in upstate New York, another who is close friends with a brand-new neurosurgeon, a third a child psychiatrist in the South.

The general issue is simple: every problem – great, small; clinical, financial, or administrative; access-, process-, or outcome-based; that involves health insurance, health plans, governmental programs is blamed on Obamacare.

That asteroid coming within a mere 745,000 miles?  Damn Obamacare!

The Ukrainian war? Due to Obamacare!

My kid didn’t get into the elite kindergarten?  Obamacare AGAIN!

Ok, a reality check…

First, while some facilities are shutting their doors, hospitals have been closing for decades, looooong before PPACA was even dreamt of. If anything, the closure rate has declined significantly of late.  That’s because the country was seriously over-bedded, a situation which led to too many inappropriate admissions.  65% occupancy rates are not sustainable and inefficient so hospitals have to either get efficient or close.  Harsh as that is, we just can’t afford them.  Yes, that will hurt some health systems and may well lead to access issues in smaller communities.  And yes, that will lead to lower health care costs and more dollars for education, tax relief, roads and infrastructure.

More to the point, hospitals are in much worse peril in states that have not expanded Medicaid.  

Second, on balance, PPACA has been good for hospitals; many are doing better these days than they were for years.  In large part this is due to higher coverage rates among the employed as well as the expansion of Medicaid in states that weren’t so blinded by misplaced ideology that they refused the federal dollars.

Third, beyond the odd anecdote, there haven’t been any credible reports of increases in waiting times, access difficulty, or lack of care that can be attributed to PPACA.  (notably I was told this was a big problem in Florida, a puzzlement as the Sunshiners have yet to expand Medicaid).

Fourth, cost.  Health insurance premiums have gone up due to health care cost increases, not due to “Obamacare”.  From a Commonwealth Fund analysis of plans with price increases >10% (insurers are required to report reasons for the increase) :

rising cost of doctor visits, hospital stays, surgeries, tests, medications and other types of direct care were responsible for 84% of the premium hikes in the individual market and 78% in the small group market (which typically includes small-company plans and others with only a minor volume discount).

Finally, PPACA’s costs continue to come down, with the latest figures indicating it will cost $139 billion less than the previous CBO estimate.

That’s $139 billion that can be spent on education, job training, infrastructure, tax relief, pre-K…

What does this mean for you?

Don’t just repeat what you hear on talk radio.  It is likely wrong.

New health plans will go out of business.  Long-time players will find themselves losing share and priced out of markets. Some Co-ops will be too aggressive and underprice coverage, and those that push it too far will be gone.

Others will focus on narrow networks, use their financial wherewithal to build systems and staff expertise, manage medical aggressively and carefully, build strong relationships with selected providers and deliver service that delights their members.

“Our whole strategy has been to invest heavily in medical management because at the end of the day, we can’t make money the way we used to, which is to conservatively underwrite this population…. Financial people [at large carriers often] don’t understand the difference that real care management can make. Conservative underwriting is how carriers have made big profits in the past.”[emphasis added] That’s a quote (subscription required) from the CEO of a New Mexico Co-op health plan, and I could not agree more.

The health insurance business is no longer one where success is driven by risk selection; it is now driven by medical management.  Yet many legacy health plans have yet to fully embrace the new market dynamic, relying far too much on benefit design, variations of old-school underwriting and risk selection.  Sure, they THINK they’re adapting and changing, but they aren’t  moving fast or far enough.

Those who don’t understand what’s happening will blame “Obamacare”, not understanding that the Affordable Care Act is having precisely the effect it should; generating competition on a level playing field, rewarding innovation and aggressiveness, penalizing complacency and traditional approaches.

What does it mean for you?

It’s working.

It’s a delicious irony; academics at one of the nation’s top universities, averaging a cool $200k income, some of whom championed parts of health reform and PPACA, are whining about deductibles of $250, $20 copays for office visits, and out-of-pocket maximums of $1500 for individuals.

Oh, the tragedy!

Yes, part of the cost increase may be due to ACA requirements for dependent and preventive care coverage, the elimination of lifetime maximums, and a higher tax burden due to the Cadillac tax.

But these Cambridgians are merely experiencing higher insurance costs and more out-of-pocket costs – what the rest of us have dealt with for years.

What’s missing from the mass media’s reportage is any real understanding of two underlying concerns, concerns that are real, important, and significant.

First, requiring cost sharing does cause some reduction in necessary care.  There’s no question about that.  As reported in the NYT article; “Consumer cost-sharing is a blunt instrument,” Professor Rosenthal [of the Harvard School of Public Health] said. “It will save money, but we have strong evidence that when faced with high out-of-pocket costs, consumers make choices that do not appear to be in their best interests in terms of health.”

This is a valid concern, and one not getting near enough attention.  Deductibles and copays have far outlived their utility; they discourage seeking needed and unnecessary care.  And, once the member blows thru their out-of-pocket maximum, they don’t do anything to reduce unnecessary utilization.  As a relatively few people incur most health care costs, we need a far smarter approach than these crude cost dis-incentives.

Second, costs are high in large part because employees’ health care choices are very broad.  Again, the NYT: “Harvard employees want access to everything,” said Dr. Barbara J. McNeil, the head of the health care policy department at Harvard Medical School and a member of the benefits committee. “They don’t want to be restricted in what institutions they can get care from.”

And therein lies the rub.  Smaller, narrow expert networks deliver better outcomes for lower cost.

What does this mean for you?

I’d expect much better approaches will emerge soon.  Especially now that the real world has invaded the Halls of Academe.