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The Patient Protection and Affordable Care Act
In an attempt to relieve the stress caused to millions by the high cost of healthcare, and to ensure that everyone has health insurance, President Obama signed The Patient Protection and Affordable Care Act on March 23, 2010. As mandated by the Emergency Medical Treatment and Active Labor Act of 1986, health care must be provided to those who do not have the means to pay. As a result, there is high cost associated with the uninsured. Those who provide this care are often not fully reimbursed. Uncompensated health care cost taxpayers approximately 41 billion dollars in 2004. While hospitals receive government assistance to cover costs, individual doctors often go partially uncompensated for the services they provide. Some providers have tried to cover the high cost of caring for the uninsured by charging higher rates to insurance companies. This has resulted in an increase of 8.5% in the cost of private insurance (Teitelbaum, 2007). If providing care to the uninsured is too costly, some providers turn away patients or close their practices altogether.
The idea of mandating every individual to obtain health care insurance was originally introduced by the Republican Heritage Foundation in 1989 (Avik, 2012). In 1993, Democrat and President, Bill Clinton introduced a Bill that required employers to provide health care coverage to employees, thus achieving a comprehensive reform of the health care system. Alternatively, the Republicans proposed a bill called the Health Equity and Access Reform Today Act, which would require each individual to purchase health care insurance, or have a fine imposed for non-
The goal and intention of the Patient Protection and Affordable Health Care Act (ACA) is to ensure that every individual has access to affordable, quality health care, and to reduce the number of uninsured persons in America. Only some of the provisions of the ACA became effective immediately upon enactment. Provisions of the ACA include changes such as; the Food and Drug Administration is authorized to approve generic drugs after drug manufacturers have had 12 years of exclusive use. Drug manufacturers will pay 17.1% rebate to states for brand name pediatric and clotting factor drugs, and 23.1% for all other drugs. This rebate is extended to Medicaid, and was increased to 13%.
Evaluation of existing studies for the purpose of determining relative health outcomes, appropriateness, and clinical effectiveness will be conducted by a non-
Further, to prevent chronic disease, The Prevention and Public Health Fund was created, along with a National Prevention, Health Promotion and Public Health Council. Additionally, restaurant chains are now required to display the caloric content of their foods when there are more than 19 restaurants in the chain. Other nutritional information must be made available upon request.
The ACA becomes fully effective in 2019, however some parts of the Act became effective immediately. These include: Guaranteed Issue, which mandates that health insurance policies be issued to individuals regardless of previous medical conditions. It further provides that, regardless of sex and condition, all applicants of the same age and location be offered the same premium, unless they are tobacco users (Kaiser).
The individual mandate, or shared responsibility requirement, states that each individual must obtain private health insurance if not covered by an employer or Public Health insurance. Failure to comply results in a monetary penalty unless exempt due to religion or financial hardship. Every state will provide a marketplace where individuals can compare policies and premiums, and purchase health insurance with the help of government assistance, if necessary. Impoverished people will receive government subsidies on a sliding scale. Under the new law, Medicaid eligibility is expanded to include families and individuals with incomes to 133% of the poverty level. Those between 133% and 150% of the poverty level will be required to pay 3 to 4% of their income in health care premiums. Additionally, the ACA provides that minimum standards be established, and no annual or lifetime caps be allowed to be placed on payout amounts.
A firm with less than 50 employees will pay a shared responsibility requirement if the government subsidizes an employee’s health care. Smaller businesses can get subsidies through exchange, if necessary. Co-
Individuals who earn $200,000 and above, and couples filing jointly with an income of $250,000 or above, will see an increase in their taxes by 3.8%. Combined with an increase in Medicare tax, this modification is expected to raise approximately $210.2 billion for ACA funding. Additionally, health care insurance providers will be charged a fee of $60 billion. Those with annual premiums in excess of $10,200 for an individual and $27,500 for families, will have to pay a $40% excise tax. Companies that manufacture or import branded drugs will pay an annual fee amounting to $27 billion.
The 2.3% tax imposed upon those who manufacture certain medical devices is expected to raise an additional $20 billion. The adjusted gross income floor will go from 7.5% to 10% on deductions for medical expenses, raising another $15.2 billion. Annual contributions will be limited to $2,500 on flexible spending arrangements in cafeteria plans, projecting $13 billion towards ACA. Offsets over the next several years are centered around Medicare cuts. Funding for Medicare policies will be reduced by $132 billion. Hospital payments will be reduced by $22 billion, and home health care is to be reduced by $40 billion.
It is estimated that the ACA will reduce the number of uninsured by a whopping 32 million, however approximately 23 million will remain uninsured due to being illegal residents, and those who refuse to comply for financial and other reasons (CB0). In addition to improving the overall quality of life, it is believed that the ACA will prevent bankruptcy, as medical bills are in large part responsible for the majority of bankruptcy cases.
Health insurance coverage alone may not be sufficient to have a significant impact on the health of the general populous. This is because having insurance does not necessarily improve environmental, stress, non-
The Affordable Care Act will protect Georgians from high deductibles, co payments, and gaps in coverage by eliminating annual and lifetime limits, and capping the amount to be spent on deductibles. In 2019, the average Georgian will have an additional $1,429 of expendable income, due to the ACA. Households that earn less than $30,000 per year will enjoy the greatest benefit, as they will have an additional $3,158 every year.
Despite these benefits, it appears that Georgia does not fully support the Affordable Care Act. By April 2012, Georgia had received approximately $307,000,000 from the Federal government towards the ACA, to help cover the approximate 750,000 uninsured who annually seek treatment. The average doctor’s office visit for the uninsured in Georgia is $95 for a general practitioner, and as much as $325 for a specialist. Between 2010 and 2012, Georgia accepted enough funds to supplement each patient $204, for each respective year.
As of June, 2013, in National Federation of Independent Business vs. Sebelius, the Supreme Court allowed individual states to opt out of Medicaid expansion if they choose to do so. Currently, the state Georgia has chosen to opt out. Georgia has approved the new insurance rate exchange, but on July 30, 2013, filed to delay new rates for insurance exchange. Some of the premium increases have been determined to be too high; one by 11%, and another by 198% (Corwin, 2013).
Probably the biggest challenge to the ACA is the Supreme Court’s ruling that allows individual states the option to opt out of the Medicaid extension. Nationwide, this option could force many millions to continue without medical coverage, and defeat the intended goal to provide health care insurance to everyone.
References
Avik, R. (2012). The Tortuous History of Conservatives and the Individual Mandate. Forbes Magazine. Retrieved from: http://www.forbes.com/sites/theapothecary/2012/02/07/the-
Cooper, M. (2012). Conservatives Sowed Ida of Health Care Mandate, Only to Spurn it Later. New York Times. Retrieved from: http://www.nytimes.com/2012/02/15/health/policy/health-
Corwin, T. (2013). Georgia Seeks Delay on High Health Care Premium Approvals. The Augusta Chronicle. Retrieved from: http://chronicle.augusta.com/news/health/2013-
Families, USA (2011). The Bottom Line: How the Affordable Care Act Helps Georgia Families. Retrieve from: http://familiesusa.org/product/bottom-
Goldman, D.P. (2010). Can the ACA Improve Population Health? Retrieved from: http://www.ncpa.org/pdfs/can-
Kaiser Family Foundation. Health Reform Implementation Timeline. Retrieved from: http://kff.org/interactive/implementation-
Pelosi, N. (2010) Congressional Budget Office, 2010. Retrieved from: http://www.cbo.gov/sites/default/files/cbofiles/ftpdocs/113xx/doc11379/amendreconprop.pdf
Teitelbaum, J.B., & Wilensky, S.E. (2007). Essentials of Health Policy and Law. Sudbury, MA: Jones and Bartlett Pulishers.
By Donna R. Turner, MPH, CHES
