Vol. 128 July 1, 2015 Obamacare is Five Years Old. Can It Walk and Talk?

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“From a historical perspective,
5 years is a very short time.
Many of the key insurance provisions have been
in effect only since October 2013.” (1)

Now that the Supreme Court has decided that a key provision in the Affordable Care Act of 2010, the federal subsidy of health insurance for eligible citizens, is legal, the infancy of Obamacare is over. It looks like it is here to stay. How is the toddler doing? What has it done? Luckily, The Commonwealth Fund just published a summary of ACA effects so far. (1)

The Commonwealth Fund is a private foundation formed in 1918 with Harkness family money made from the early oil business, (Shell Oil).

“The Commonwealth Fund has sought to be a catalyst for change by identifying promising practices and contributing to solutions that could help the United States achieve a high-performance health system. The Fund’s role has been to establish a base of scientific evidence on what works, mobilize talented people to transform health care organizations, and collaborate with organizations that share its concerns. The Fund’s work has always focused particularly on the challenges vulnerable populations face in receiving high-quality, safe, compassionate, coordinated, and efficiently delivered care.”

This health-care-focussed fund and think tank reports that it is too early to see many benefits of the ACA, but lists some of its immediate, observable effects.

Access to care:

  • 7.0 to 16.4 million young adults from chronically uncovered populations ( hispanics, blacks, and those with low incomes) have gained health insurance coverage since 2010 (different survey methods and timing cause the difference in results).
  • 11.7 million Americans selected a health plan through the health insurance marketplaces established by the ACA. 87% of those people were eligible for federal subsidies of premiums.
  • 10.8 million additional Americans have enrolled in Medicaid since the ACA was passed.
  • 3 million previously uninsured young Americans have gained coverage through the ACA extension of dependent coverage to age 26.
  • 8-12 million Americans have benefitted from the ACA’s regulation that prevents insurers from discriminating against people with preexisting conditions.
  • 75% of those newly insured seeking appointments with primary care or specialist physicians have secured one within 4 weeks or less.

Delivery-System Reform:
“ The law constitutes one of the most aggressive efforts in the history of the nation to address the problems of the health care delivery system through funding many divergent experiments though lacking a coherent strategy.” (1)  The Commonwealth Fund report lumped the efforts into four categories.

1. Changes in Payments:
Reduce readmissions – There are 150,000 per year fewer Medicare hospital readmissions within 30 days of discharge partly attributed to ACA financial penalties to hospitals with higher than expected readmission rates.
Reduce hospital-acquired conditions – ACA financial penalties to hospitals in the highest quarter of avoidable hospital-acquired conditions may have helped the composite rates for those to drop by 17% from 2010 to 2013.
Pay for Performance – ACA payment incentives to hospitals and physicians to improve their performance on various cost and quality measures: “too early to tell”.
Bundled payments – This departure from fee-for-service reimbursement pays the hospital, the physician, and post-hospital services with a single payment for a procedure or condition. 7000 providers have signed up for it, but it is “too early to tell”.

2. Changes in the Organization of Health Care Delivery:
Accountable Care Organizations (ACOs) – An ACO is an organization of physicians and hospitals formed to improve the integration and coordination of ambulatory, inpatient, and post-acute services for a defined population of Medicare beneficiaries. 405 ACOs are participating in a program that allows them to keep a portion of any cost savings they can generate without degrading quality. Although the pilot program of about a dozen Pioneer ACOs “saved” $385 million in the first two years, it is “too early to tell” if the others will have a postive effect.
Primary Care Transformation – A pilot program to reduce costs and improve quality in primary care has shown a $14 per month cost reduction per Medicare enrollee and less emergency room visits and hospitalizations in the 2.5 million patients participating in its first year, but it is “too early to tell”.

3. Changes in Workforce Policy:
The effects of increased primary care reimbursement for Medicaid patient services, increased National Health Service Crops scholarships for practicing in underserved areas, and establishment of a National Health Care Workforce Commission (but remains to be funded by Congress) are all “too early to tell”.

4. Increase Innovation in Health Care Delivery:
The Center for Medicare and Medicaid Innovation (CMMI) was funded at $1 billion a year for 10 years to undertake a wide variety of experiments in improving quality for patients and reducing the 43% share of national health costs now paid by the government.

  • Commonwealth Fund says: CMMI is perhaps the most promising of the ACA efforts, but “way too early to tell”.
  • The CMMI itself reports it has launched 26 “demonstration models” of cost reduction and quality improvement. The Pioneer ACOs mentioned above is the first model “to meet the statutory criteria for expansion”.(2)
  • A separate report from Weil Cornell Medical College Department of Healthcare Policy and Research states that to date the CMMI has spent only one-third of its $10 billion, that it seems to be slow in distributing data from its experiments to participating organizations, and that it is hampered, as most quality improvement efforts are, by the lack of consensus on what constitutes “ improved quality”. So it is “too early to tell” (2)

Wow, that is definitely more than you may have ever wanted to know about the ACA so far!
It is certainly more than I can remember.
It is clear that Obamacare does have a lifetime before it.
As that lifetime unfolds one can only hope that responsible adults will guide it through its future developmental stages.

Bottom line: carry a small laminated copy of this blog in your pocket or purse to pull out when engaged … embroiled, …immersed, …or even entangled in any discussion about Obamacare, which will continue, even if Hilary renames it.

Remember, Medicare was just as controversial when first passed. One governor that opposed Medicare actually mobilized his state’s National Guard the day Medicare was passed in fear of the hordes of newly insured people that he expected to overwhelm emergency room departments.

References:
1. NEJM June 18, 2015;  The Affordable Care Act at Five Years
2. NEJM May 21, 2015;  Assessing the CMS Innovation Center

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2 Responses to Vol. 128 July 1, 2015 Obamacare is Five Years Old. Can It Walk and Talk?

  1. Jason Bacon says:

    Hub

    The source of the Harkness family,s wealth is Standard Oil not Shell.

    Jas

    • hubslist says:

      You are absolutely right, and quick on the draw too! You ca now understand why I have never ventured into the financial world.

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