Vol. 116 December 15, 2014 Obamacare Update

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“After a year in place, the Affordable Care Act has largely succeeded
in delivering on President Obama’s main promises.”
– NY Times

“Americans would rather see it improved than repealed.”
– Boston  Globe

Today, December 15, is the deadline for new enrollees to sign up for health care insurance under Obamacare ( December 23 in Massachusetts). It seems an appropriate time to take a look at how it is going. The deadline for renewals is February 15.

The recent Jonathan Gruber “revelation” about Obamacare’s “non-transparency” alleged that “ they did not tell the public that young, healthy people must subsidize sick people to make the numbers work.” Well, hello, what about insurance don’t you understand?! Those of us whose house has not burned down are subsidizing (aka “insuring the loss of”) those whose house has burned down!

Since the ACA was passed in 2010 the number of uninsured has fallen by 25%-33% depending on the study. At least 8 million and perhaps 11 million previously uninsured are now covered. Critics of the ACA charge that number is overstated by about 700,000 who merely got dental insurance coverage. More about that later in this blog. The law “is helping the health care industry by providing new paying patients and insurance customers.” It certainly is!  Health insurance companies are looking at a “nearly $2 trillion ( yes, TRILLION) of subsidized coverage through insurance exchanges and Medicaid over the next 10 years,.” Share prices of four of the major health insurance companies – Aetna, Cigna, Humana, and United Health – have more than doubled since March 2010. (1)

ACA subsidies are helping many who could not get health care coverage previously, but deductibles and variable out-of-pocket costs can remain a burden on low- and middle-income Americans. Please note the key word “Americans” here because the law does NOT extend coverage to un-documented immigrants. Undocumented immigrants and adults in 23 states that have not extended their Medicaid coverage as subsidized by the ACA comprise the major portion of uninsured persons. Texas, Florida, and California have the highest proportions of those people.

ACA health care insurance premiums were predicted to skyrocket, but in fact they will rise an average of 5% for 2015. “One reason may be that insurers who came in high in 2014 found themselves beaten out for enrollments. 77 new insurance plans will be competing for customers in 2015.” (2)  The online application for new customers is down to 16 screens from the original 76 screens that scuttled the first website application.

A physician from Kentucky in an essay in the NEJM pointed out that the two Kentucky senators remain vehemently opposed to Obamacare despite the fact that 413,000 Kentuckians have gained health insurance coverage under the ACA law. Senate Minority Leader Mitch McConnell (R-Ky) has suggested that Kentucky could keep its health care exchange established by the ACA, Kynect, “even if the ACA is repealed”. (Does “have your cake and eat it too” come to mind here?) “It is unfathomable that they can continue to oppose the law and that geography can determine the adequacy of American’s care.” (3)

Government reports reveal that 1.4 million new enrollees have made selections of plans through December 5 through federal exchanges in 37 states. Reaching the CMS announced target of 9.1 million enrollees by 2015 appears to be imminent. The law’s “penalty” for individuals remaining underinsured started out at $95 (or 1% of income) annually in 2014 will go to $325 (or 2% of income) in 2015.

It is too early in its implementation to evaluate the ACA’s promised improvement of quality. A recent study of Massachusetts mortality rates after ACA implementation suggested that its effect has been positive, but many criticized the study’s conclusions as speculative and premature. Obamacare did create the Medicare Hospital Readmission Reduction Program aimed at reducing readmission within 30 days of hospital discharge; an expensive event supposedly associated with inadequate treatment during the first hospitalization or inadequate follow-up as an outpatient. The national readmission rate for Medicare dropped from 19% in 2007-2011 to 17.5% in 2014, “in part as a result of the ACA”.

An early sign of the success of Obamacare might be the very recent demand to expand its dental insurance benefits for children to adults via a proposed Comprehensive Dental Reform Act of 2013. (4) Look to this concept and the coverage of non-documented immigrants to become issues in the 2016 election. For those of you with a really long-term outlook, expect Hilary’s Affordable Veterinary Office Care (HAVOC) to be a hot issue in 2020.

Even during this very polarized midterm election some perceived a subtle shift on the Republican side from “Obamacare opponents” to “Obamacare critics”. They may be getting the message that a large portion of the citizenry is liking the health insurance coverage that reduces their stress and concern about the potential impact of uninsured illness on their life and pocketbook. Maybe more member of both parties will switch from Obamacare “opponents” to Obamacare “critics”, since we all agree that Obamacare, or whatever Hilary chooses to call it during her first term, can be improved.

References:
1. Bos Globe Nov. 18, 2014; pg A8
2. Cape Cod Times Nov. 1, 2014
3. The Affordable Care Act, 1 Year Later, NEJM 371;21, pg. 1960, Nov. 20 2014
4. Integrating Oral and General Health Care, NEJM 371:24, pg. 2247, Dec. 11, 2014

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2 Responses to Vol. 116 December 15, 2014 Obamacare Update

  1. Frank says:

    Unfortunately, you aren’t addressing the mandate that will hit in 2015 nor are you addressing the huge tax increase in 2016 for those who don’t sign up for it. Also, from your last paragraph, can I deduce that you are voting for Hillary in 2016? That’s certainly the implication from your verbage. If so, no wonder you like Obamacare and the loss of your individual freedom.

  2. Good review. It’s nice to hear some documented facts rather than what we hear from politicians.

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