John Colbert

August 17, 2018

DEVELOPMENTS IN HIGHER EDUCATION

John Colbert

August 17, 2018

Two issues in higher education attracted a considerable amount of attention in June 2018. The newest is an announcement by the Trump Administration to merge the Departments of Labor and Education into a single Department of Education and the Workforce, The older issue pertains to reauthorization of the Higher Education Act, a piece of legislation that is many years overdue. Some observations regarding these two matters are as follows:

Creation Of A Department Of Education And The Workforce
Many students and their families today accumulate a small mountain of debt in paying for a college education. Long gone are the days when a student could bag groceries at a supermarket on weekends and find a job in the summer that achieved sufficient earnings to cover all educational costs for the upcoming academic year and still leave over some dollars for personal expenses. As the price of an education began increasing every year to soaring heights in both public and private institutions, parents began clamoring for an assurance that suitable employment and salaries awaited students after they graduated.

Another force of a different nature has led to assessments of the adequacy of the link between schools and subsequent employment opportunities. The economy became more global in nature, which means that the U.S. has to be much more competitive in efforts to stay on top in areas involving science and technology. Evidence that graduates of domestic institutions are not being produced in adequate numbers to fill those kinds of positions is shown by the necessity of issuing special visas to individuals from other nations to address the needs of employers seeking college graduates with the proper mix of knowledge and skills.

These two factors involving the high cost of education and the desirability of producing graduates who can be employed gainfully upon completing school provide a rationale for exploring the possible creation of stronger connections between federal organizations that focus on labor and education issues. Portions of the higher education community already have adopted that posture as demonstrated by linking college and the workplace through internships, career-placement services, and workforce-development efforts that are situated to address employer needs and demands.

What the Administration is proposing in broad terms is that the new Department would be able to oversee education, skill development, workplace protection, retirement security, and also address the skills shortage facing many industries. An intended result of the merger is to combine all functions of the two Departments, along with more than 40 workforce development programs that span 15 agencies to create a greater alignment among components of the education-to-career pipeline. Governmental restructuring is never an easy task. Partisan differences provide a certain guarantee that efforts to create a combined Education and Labor department will be an uphill battle.

Reauthorization Of The Higher Education Act
A two-act absurdist-tragicomic play called Waiting for Godot by Irish Nobel Laureate Samuel Beckett was panned by fellow countryman Vivian Mercier as a dramatization in which “nothing happens, twice.” That observation occasionally comes to mind when considering the fate of efforts on Capitol Hill to reauthorize the Higher Education Act (HEA). A decade has elapsed since the HEA last was reauthorized. Lamar Alexander (R-TN), Chairman of the Senate Committee on Health, Education Labor & Pensions, indicated that his committee will not produce legislation to reauthorize this important legislation in 2018. Many contentious points separate Republicans and Democrats over key issues, such as overhauling the federal student aid system.

Return to trends june 2018

AFFORDABLE CARE ACT DEVELOPMENTS

John Colbert

August 17, 2018

Trends Archives

Since the Affordable Care Act (ACA) become law in 2010, Congressional Republicans have vowed to repeal and replace it. With the advent of the Trump Administration in 2017, they were in a more favorable position to send a bill to the White House to be signed for that purpose. The problem is that they failed to pass the necessary legislation. Until they are successful in doing so, which appears highly unlikely, another option is for the Administration to issue rules that make it possible for different kinds of insurance products to enter the marketplace for consumers. Association health plans and short-term plans are examples.

A separate remedy to pursue is to use the courts. A way to do so is to claim that certain provisions of the ACA are unconstitutional. The Department of Justice (DOJ) has declined to defend the provision of the ACA that protects individuals with pre-existing conditions from being declined individual health insurance protection. If a judge rules in favor of 20 Republican states currently suing the federal government over the constitutionality of the ACA, possible outcomes could include: increased charges for women, individuals with health problems could lose their coverage, and young beneficiaries could pay lower premiums.

Final Rule Issued On Association Health Plans
The Department of Labor on June 19, 2018 issued a final rule aimed at making it easier for small businesses and individuals to create association health plans (AHPs), which are entities that will be exempt from certain Affordable Care Act (ACA) consumer protection requirements. The rule exempts AHPs from individual and small group market regulations, allowing AHPs to offer less comprehensive insurance products. Small groups will have an opportunity to combine to purchase health insurance that does not have to comply with essential health benefit (EHB) standards. Small businesses and self-employed individuals in the same industry, state, or region will be able to obtain health coverage as if they were a single large employer. These new plans will become effective on September 1 of this year. Although Democrats are not in favor of this approach, Republicans assert that more coverage options and affordable alternatives will be available than was possible under the Affordable Care Act. The Congressional Budget Office (CBO) estimates that four million individuals will join the new AHPs. If enrollees prove to be healthier and have higher incomes, premiums for individuals remaining in the ACA individual marketplace may become higher.

Proposed Creation Of Short-Term Health Insurance Plans
The Trump Administration has indicated that another rule soon may be issued regarding short-term health plans, which also will not include various ACA requirements. This kind of coverage is designed to be less comprehensive and less expensive than what is available in the Affordable Care Act (ACA) marketplaces. A main feature is that insurers would be able to sell them for up to 12 months, potentially making them more attractive, especially to younger and healthier individuals. Researchers from RAND did an examination of how the rule may affect insurance enrollment and premiums, analyzing the rule alone and in combination with the recent repeal of the ACA individual mandate penalty, which occurred with tax reform legislation that became law last December. Changing only the duration of short-term plans would have minimal effects, but increasing the duration to 12 months, removing the individual mandate penalty, and eliminating some behavioral barriers (e.g., increasing awareness of short-term plans) would decrease enrollment in ACA-compliant plans by nine million and increase premiums in silver-tier marketplace plans by 3.6%.

Medicaid Overpayments
When the ACA became law, Medicaid became a principal vehicle for providing insurance coverage for individuals who lacked it. Republicans on the Senate Homeland Security and Governmental Affairs Committee released a report on June 20, 2018 accusing the Centers for Medicare and Medicaid Services (CMS) of not conducting adequate oversight of the Medicaid program. Their report indicates that Medicaid overpayments have increased from $14.4 billion in 2013 to $37 billion in 2017.

Return to trends june 2018

FUNDING AND AGENCY RESTRUCTURING

John Colbert

August 17, 2018

Trends Archives

The House Appropriations Committee in June 2018 released the text of its fiscal year (FY) 2019 Labor, Health and Human Services, and Education funding bill. The proposed legislation contains $177.1 billion in discretionary spending, which is similar to current enacted levels. The U.S. Department of Health and Human Services (HHS) would receive $89.2 billion, a $1 billion increase and $2.4 billion more than requested in the President’s budget. The bill would prohibit any funds from going toward health care coverage that provides abortion and it prohibits the use of funds to implement the Affordable Care Act (ACA). The National Institutes of Health (NIH), would receive $38.3 billion, an increase of $1.3 billion over FY 2018 and $4.1 billion more than the White House’s request.

President Trump’s request to rescind $15 billion in unspent funds was rejected in the Senate in June. A procedural vote on H.R. 3 to discharge the bill from the Senate Appropriations Committee failed 48-50. A simple majority was needed to advance the measure. Republicans Susan Collins (R-Maine) and Richard Burr (R-N.C.) joined Democrats in voting against the legislation.

The Administration released a plan to reorganize major components of the federal government. If implemented, the proposal from the Office of Management and Budget (OMB) would merge agencies with overlapping or duplicative responsibilities and eliminate agencies deemed unnecessary as a means of modernizing the federal government. The Departments of Labor and Education would be combined into the Department of Education and the Workforce (see page 5 of this issue of the newsletter). The U.S. Department of Health and Human Services (HHS) would become the Department of Health and Public Welfare and would absorb nutrition assistance programs into its mission. The plan would create a Council on Public Assistance within the Department. The Food and Drug Administration’s (FDA) food-related responsibilities would be moved to the Department of Agriculture and the FDA would be renamed the Federal Drug Administration. Other proposals would shift the Agency for Healthcare Research and Quality (AHRQ), the National Institute for Occupational Safety and Health, and the National Institute on Disability, Independent Living, and Rehabilitation Research to the National Institutes of Health (NIH).

Whether any of these initiatives will materialize will depend on whether congressional approval is required. Some opposition can be expected not only from legislators, but also from interest groups that have developed relationships with these departments and agencies. Realignment will result in shifts in power and produce changing patterns of influence. In many cases, reorganizations disrupt existing relationships in ways that produce sets of winners and losers. Little motivation exists to want to become a member of the latter group.

DEVELOPMENTS IN HIGHER EDUCATION

Other Articles from TRENDS June 2018

WORDS AND THEIR PLACEMENT REALLY MATTER

FUNDING AND AGENCY RESTRUCTURING

AVAILABLE RESOURCES ACCESSIBLE ELECTRONICALLY

ARTIFICIAL INTELLIGENCE, ROBOTS, AND THE HEALTH CARE INDUSTRY

PRESIDENT’S CORNER — ASAHP MEMBER FOCUS

AFFORDABLE CARE ACT DEVELOPMENTS

QUICK STAT (SHORT, TIMELY, AND TOPICAL)

HEALTH TECHNOLOGY CORNER

THE WALKING CORPSE SYNDROME

AFFORDABLE CARE ACT DEVELOPMENTS

Other Articles from TRENDS June 2018

WORDS AND THEIR PLACEMENT REALLY MATTER

FUNDING AND AGENCY RESTRUCTURING