The Affordable Care Act — Scrap or Save?

By Mark A. Kelley, MD |5/16/17

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Our blog will also be posted more frequently so we can update you on the current advances in medical science and healthcare policy. We encourage you to share your thoughts.

This week’s post will focus on the fate of the Affordable Care Act under the Trump administration.

The Affordable Care – What’s Behind the Politics?

The politics of federal health policy have dominated the headlines for weeks.

The House of Representatives narrowly passed a bill called the American Health Care Act (AHCA) to replace the Affordable Care Act (ACA, also known as Obamacare). The AHCA has now been sent to the Senate.

The ACA has expanded healthcare insurance to 20 million uninsured Americans. It also mandated basic benefits for all insurance plans. Among them is a law that prohibits financial penalties for patients with pre-existing conditions. The result is that many more Americans can protect their health and avoid bankruptcy from medical payments.

Critics claim that the ACA has failed. They describe higher premiums, insurers leaving the program, and excessive costs. These are real problems—but not failures. The AHCA will make them worse by reducing coverage with no significant cost savings.

The U.S. has not caught up with most other developed countries that have government-supported universal health care. These programs are funded by taxes on everyone. That policy distributes the financial risk across the population and gives everyone the same health insurance benefits.

That approach could work in the U.S. At least 50% of Americans are very healthy and have little or no health care costs. If these healthy consumers would buy health insurance (or pay taxes), we could cover the 20% of our population who consume 80% of health care costs.

But the U.S. has never viewed health care that way. There is no tax for health care (except Medicare for the elderly).

The ACA tried to fix that by requiring healthy, uninsured Americans to buy health insurance to support sicker patients. That law, called the “individual mandate,” has not worked because the government has not enforced it.

That worries insurers, who have enrolled many sick people but few healthy ones. Now some insurers are facing losses. By law, the insurers cannot charge sick people more. The ACA gave insurers temporary guarantees against losses but that guarantee period is ending.

The responses are predictable. Insurers are increasing their premiums to cover any losses. Some have left unprofitable marketplaces or exited the ACA altogether. Lacking any enforcement, millions of uninsured healthy Americans still pay nothing into the pool. Meanwhile, millions more Americans have new health insurance that they want to keep.

For universal coverage, all Americans must contribute to the costs of health care. Our taxes pay for defense, education, highways – why not health? In fact the Supreme Court ruled that the ACA is legal because the individual mandate is basically a tax that the government has the right to impose.

We already have experience with such a plan. For decades, taxes have supported Medicare for our elderly population. Medicare took years to evolve but is highly successful and popular with patients. It has survived many challenges. Elected officials have found that “messing with Medicare” can be politically dangerous.

The American public has been strongly in favor of universal health coverage, which exists in every other developed country. The ACA has been a major step in that direction. Many more citizens now have the opportunity for a healthy life and freedom from medical bankruptcy. They will not easily surrender these benefits.

The AHCA is a setback for universal coverage. The proposed law will reduce insurance for millions of Americans, and use those savings to cover a tax cut for the wealthy.

It is time for our elected officials to get down to business and fix the ACA without threatening patients with the loss of their health insurance.

The only political “win” is assuring that all Americans have affordable health care long into the future.

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