Affordable Care Act's future could be as disputed as its past
It's hard to tell the future of the Affordable Health Care Act (ACA) because of all the political wrangling around it. Even as this piece is written, a bill before the United States Senate, that was passed by the House of Representatives, threatens to "defund" the act.
But as of this time the ACA is the law and parts of it will continue to come into effect unless Congress makes changes to it.
For that reason, it is good to know those changes and what has happened. Now those affected by it need to look at the future and what will be coming into force in the next year, a pivotal year for the ACA.
First, there will be a number of consumer protections beginning in 2014. As of Jan. 1, insurance companies will be prohibited from refusing to provide coverage or renew existing insurance policies because an individual has pre-existing conditions. In addition, they will not be able to charge higher rates to individuals or small group markets for those same reasons. The Act also keeps insurance companies from doing the same thing with gender-based policies.
Second, insurance companies will not be able to put limits on dollars that are spent on an individual for medical costs in new plans or on group insurance plans. This has been a problem for many who get a catastrophic disease and find that their insurance would pay up to a certain point during the year, but no more. This also takes affect Jan. 1.
In the past people who volunteered and were accepted into clinical trials for drugs and procedures, were sometimes cut out of their regular insurance for participating. That will no longer happen after the first day of 2014.
With the advent of all individuals having to have coverage under the law starting in 2014, a series of tax credits will kick in to help those who cannot afford the coverage needed. This part of the law particularly affects the middle class. The part of the law covers people who make from 100 percent to 400 percent of the federal standard for poverty (currently $23,550 for a family of four). That would move the line for tax credits up to $88,000 for a family of four. Because of the burden those who wrote the law saw on families who would have to pay this throughout the year, it is set up so that those tax credits are "advanceable" so that it lowers the premiums each month rather than for April 15 of each year to refund the money spent. Some will also qualify for reduced co-payments and deductibles.
The next year will also bring in the insurance marketplace, where individuals without insurance from employers will be able to buy it from providers within that marketplace. This part of the law also will apply to small businesses, which can use the marketplace to insure workers as well. There will be a number of insurance companies involved in the plan. It is projected that some businesses will give employees a certain amount of dollars to spend and then they can go to the marketplace and pick out which plan is best for them.
Utah has led the nation in setting up its own system for insurance for small business called Avenue H. It is set up for small businesses to denote certain amounts of money for their employees to spend with the individuals in the plan making the decision about what is best for them. For more information on Avenue H go to http://www.avenueh.com/
The ACA also sets up tax credits for small businesses. In some cases small companies can get up to 50 cents in tax credit for every dollar they put into employee health care.
Probably one of the most controversial sections of the law is the mandated insurance all individuals must have. There will be exemptions available for some, but most people will need to pay for some kind of basic coverage if they already do not have it. The philosophy by the proponents and creators of the law is that for such a national health care system to work, healthy individuals need to pay into the system the same as those that aren't well to balance out the costs for insurance companies. Those who oppose it see a deterioration of the individuals rights to make decisions about his or her life on their own.
Effective January 1, 2015 the payment to physicians will also change. The law denotes that instead of paying doctors for the volume of care they provide, it will be paid based on the value of the care.
One of the biggest controversies in the bill also concerns Medicaid and who will pay what. As of Jan. 1, 2014 people who earn less than 133 percent of the poverty line will eligible to join Medicaid. States that accept the new programs growth will be able to get 100 percent of the funding of the program for the first three years and then after that the funding from the national government will drop to 90 percent.
In Utah the decision to take this funding has not been made yet. Governor Gary Herbert had said a decision will be made and announced sometime in December, but retreated a little on that date because of information gathering that may take longer. Many lawmakers at the state level oppose it, so it is expected to be an issue discussed at the 2014 legislature.
Governor Herbert formed a medicaid expansion committee earlier this year to study the situation. That panel consists of representatives from many areas of interest including business leaders, legislators, advocates for the poor and some from the field of medicine. The committee is broken into five sub-committees that are investigating various aspects of a possible Medicaid expansion.
Those that are concerned see the expanded program as eventually being a kind of Trojan Horse that comes for the first three years with full funding but then huge chunks of state money having to be expended when the federal share drops to 90 percent.
Medicaid differs from Medicare in that Medicaid is a shared program with the federal government, whereas Medicare is paid entirely with federal dollars. Presently about 21 percent of the children in the state are covered by Medicaid. Most are low income or disabled. The program can also cover those children's parents as well as pregnant women, disabled adults and some seniors. Under the ACA low income single adults and some others would become eligible. Utah presently spends about 10 percent of its state budget on Medicaid (in 2012 that was $1.8 billion). The 2012 fiscal year Medicaid figure went up a little over $80 million dollars in the fiscal 2013 budget. That average for all states to spend on Medicaid is about 15 percent of their budgets.
Utah remains amongst a group of about 23 states that have either not committed to the new Medicare program or are rotating to a position of not joining in.
(This is the final installment of three articles that discuss the Affordable Health Care Act)