Health Care Reform - Part 3
This paper will look at the health care reform that is taking place in the United States - Health Care Reform introduction. It will examine how the reforms came about, the financial details of the reforms, and the possible economic effects related to its success or failure. The paper will also briefly look at the history of health care reform. The Affordable Care Act signed into law in 2010 has parts going into effect over the following four years. Portions that are in effect currently relate to pre-existing conditions, limiting lifetime coverage limits, providing free preventive care, and young adult insurance coverage (U.S. Department of Health & Human Services, 2010). Historic Attempts at Reform
President Franklin Roosevelt attempted to ensure health care for seniors in the 1930s but the effort failed. Medicare finally passed into law in 1965 under President Johnson. After Roosevelt’s first proposal many there bills were proposed and debated multiple times, never successfully (Mery, Liepert, & Cooke, 2010). Since its inception, many changes to the Medicare act have attempted to reduce and control costs. The diagnostic related groups (DRGs) were put in place in 1983 to limit hospital costs. Another attempt at reform was made under President Nixon; the Comprehensive Health Insurance Act (CHIP) was introduced in 1973. CHIP included three major programs: employee health insurance, assisted health insurance, and improved Medicare. The proposal was to make one of the three plans available to every American, but still maintain voluntary participation” (Mery, Liepert, & Cooke, 2010. Pg.17). It seemed an ideal, less expensive way to insure all Americans, but it could not pass Congress in the wake of the Watergate scandal and President Nixon’s resignation. Further reform to health care came in 1986, under President Reagan. The Consolidated Omnibus Reconciliation Act (COBRA) focused on those who lost jobs and therefore employer provided health insurance plans. President Clinton attempted reform in 1993 with the Health Security Act. This was a similar attempt to the Nixon plan of universal coverage through multiple options. Many believe that the Clinton plan failed as a result of the lack of input from Congress in the development of the plan. How Reform Begins
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The health care reform that is currently being implmented was developed with input from multiple sources. President Obama set out a list of top priorities and left it to congress to draft the language of the bill. Lobbyists do come into play. The insurance companies and pharmacuticle companies have many lobbyists that work on Capital Hill to affect legislation in the favor of their industries. Additionally, organizations such as the American Association of Retired Persons (AARP) have lobbyists that were also involved in the drafting of the legislation. Both houses of the Congress presented bills for review and vote. Then the two houses through a process of reconcilliation passed the senate health reform bill, H.R. 3590- the Patient Protection and Affordable Care Act (PPACA). President Obama signed it on March 23, 2010 (Mery, Liepert, & Cooke, 2010). The PPACA was designed to be implemented in stages, and the implementation has had some stops and starts. Challenges to the PPACA
Challenges to the constitutionality of the PPACA have occurred, based on state’s rights and governmental reach. The challenges went to the Supreme Court and the PPACA was upheld as constitutional. “On June 28, the United States Supreme Court released its ruling in the National Federation of Independent Business, et al., v. Sebelius, Secretary of Health and Human of the individual mandate section of the Patient Protection and Affordable Care Act (PPACA) — the centerpiece of the case — was upheld under the rationale that the constitutional power to levy taxes sufficiently extended to the law” (Supreme Court Ruling Released: PPACA Deemed Constitutional, 2012). Funding and Effects of the PPACA
So the next question is how will this reform be paid for and how will it affect the health care marketplace. According to the Congressional Budget Office (CBO) the PPACA will cost $938 billion over 10 years. However, it is projected to reduce the federal deficit by $143 billion (Connors & Gostin, 2010). “The PPACA and deficit reduction will be funded through new taxes, fees, and penalties on individuals, businesses, and the health care industry. This alert will touch upon the biggest changes individuals, businesses, and the health care industry will experience in the next few years. Taxpayers will contribute to PPACA funding through an additional Medicare tax imposed on wages and investment income, penalties for failure to maintain health care coverage, a higher threshold for itemized medical expense deductions, and an additional tax on distributions from health and medical savings accounts” (Douglas & Burke, 2010. Pg. 1).
Many opinions exist about the final effects of the PPACA on the overall economy. Some believe the country will be bankrupt by the measures. Others believe the CBO estimates of the potential savings to be too low. Articles supporting both opinions are available everywhere, but who decides which are correct? The U.S. Government Accountability Office (GAO) has completed micro simulation models to estimate the effects of the PPACA on employer-sponsored health plans. Their simulations projected little change in prevalence in the first few years. The estimates ranged from a net loss of 2.5% to a net gain of 2.7% in the total numbers of persons with employer-sponsored health plans in the first two years of PPACA provisions. These estimates would affect up to four million people. Two of the studies indicated most people losing employer-sponsored health coverage would transition to another form of coverage (GAO, 2012).
The economic effects have yet to be determined. Some feel it will cause the loss of insurance coverage for millions. Others feel it will result in a reduction in health care costs and the deficit. Conclusion
Where does that leave us? The PPACA has gone into effect, providing young adults with coverage under their parents’ insurance plans until they can obtain it for themselves. It has prevented the exclusion of preexisting conditions, and provided free healthy doctor visits for those with coverage. As we move forward, the remaining provisions will be put into place, including the expansion of Medicaid and insurance market opening up.
The historic passing of the PPACA was the result of years of work, from the Roosevelt attempts to the hard work of President Obama. All of the prior work brought us to this place. The input of many people from both houses of Congress as well as industries affected by reform went into drafting the legislation the eventually became the PPACA.
The effects on the economy are yet uncertain, but the estimates show that more people will have health care coverage as a result, and this is the goal of the legislation.
U.S. Department of Health & Human Services. (2010). What’s changing and When. Retrieved from Health Care.Gov: http://www.healthcare.gov/law/timeline/ Supreme Court Ruling Released: PPACA Deemed Constitutional. (2012, June 28). Retrieved from American Society of Anesthesiologists: http://www.asahq.org/For-Members/Advocacy/Washington-Alerts/Supreme-Court-Ruling-Released-PPACA-Deemed-Constitutional.aspx Connors, E., & Gostin, L. (2010). Health Care reform A Historic Moment in US Social Policy. Journal of American Medicine (JAMA), 2521-2522. Douglas, B., & Burke, K. (2010, July 12). Patient Protection and Affordable Care Act- How it Will Be Funded. Retrieved from Larkin Hoffman Attorneys: http://www.larkinhoffman.com/news/article_detail.cfm?ARTICLE_ID=636 GAO. (2012). Patient Protection and Affordable Care Act: Estimates of the Effect on the Prevalence of Employer-Sponsored Health Coverage. Washington: U. S. Government Accountability Office. Mery, C., Liepert, A., & Cooke, D. (2010). The modern history of health care reform. Bulletin of the American College of Surgeons, 15-20.