“Affordable Care Act or Obama Care: which would you prefer?” Recent polls conducted by CNBC reveal that an additional 9% of participants oppose the law when the name of our president is attached, even though both refer to the same law: The Patient Protection and Affordable Care Act. It’s a piece of legislation that strives to expand availability of healthcare, but the general public remains clueless as to what that entails.
A high proportion of the public is vastly unaware of the basic provisions in the act, and disapproves more of the fact that it belongs to Obama instead of its actual content. An even higher proportion is unaware of its existence. But an even bigger issue is that no one knows for certain how it will directly affect the American public or the entire healthcare system in the long haul.
There are three main parts to the Patient Protection and Affordable Care Act. The first is the expansion of Medicaid to those that have an annual income of up to 33% over the poverty line and to mitigate the practice of denying coverage due to preexisting condition. Secondly, the ACA creates state-sponsored health-insurance exchanges in which consumers are able to choose among select private insurance plans, thus turning the insurance market into a free market. The last provision of the law is the mandate establishing employer-financed coverage for company employees in most companies.
So how will the act affect the public and the economy, and more importantly, hospitals and their doctors? The shift to centralization of private practices is currently underway, with the intent of expanding access to healthcare on average at lower and affordable costs. Establishment of multi-physician care facilities will create institutions with combined resources and broader doctor/patient choice—risk-distribution among physicians will reduce liability and diffuse responsibility, allowing doctors to allocate more of their time to providing better care. The logic behind the ACA is sound—it’s the implementation that poses the real obstacle.
Many claim that enactment will improve the healthcare system and maximize efficiency. Still, others predict failure of this massive undertaking and an accompanying rise of the national deficit. Its net economic and social effects are still unclear, and will likely remain so for years to come. Currently, the ACA is in the process of implementation, and budgeting costs and socioeconomic factors will continue to hinder the realization of the law. According to Yale Law professor Jacob Hacker, “The ACA looks like a Rube Goldberg contraption. Its basic structure mixes state and federal responsibilities, competing administrative centers of authority, and public and private activities in a manner that can be charitably described as complex.”
The implementation of the ACA will be costly in itself, with a projected $1.4 trillion needed for full realization of the act. The main beneficiaries are those right in between the line that defines the lower and middle classes. This only contributes to the growing cost of the Act, whose payments are projected to run over the next 10 years, and is the source of political unrest.
Already healthcare professionals are trying to accommodate the costs by engaging in hospital mergers (such as the one between Yale-New Haven Hospital and St. Raphael’s Hospital). The recent government shutdown was caused by disagreements within the government on how to allocate funds to pay for this expansion of healthcare. Even with tax credits given to small businesses and the establishment of state insurance exchanges, as well as the broadening of federal subsidies to co-opt insurance paying, the shuffling of money might not be sufficient. The ACA potentially holds benefits for many– unfortunately, it may be a while before the entirety of those benefits are felt. However, many agree that the long-term benefits are justified to outweigh the short-term costs. It seems illogical to spend massive amounts of money on a project that saves a few dollars now, but the Social Security Act faced the same issue in 1935. Its establishment began with a rocky and financially questionable start, but ultimately went on to establish a strong foundation for the stability of the economy, and today serves as an integral part of our nation’s security.
Doctors and healthcare practitioners will of course feel the impact of the ACA as well. In principle, doctors will be rewarded based on the quality of the procedures they perform, as opposed to the number. This “capitation model” should increase the efficiency of care given to each patient and decrease overall costs for both the hospital and patient. However, the majority of the public may ultimately be the source for these costs; small businesses will be given tax credits in exchange for insurance coverage of employees, and the government will give subsidies to larger businesses, but higher taxes will be imposed on the general public. The federal mandate has ensured that individuals in the middle and higher class pay for the ACA, either through the recent 40% tax increase on health insurance plans exceeding $10,200 per individual, or through the annual $95 penalty in failing to obtain a health insurance plan. We as the public will save money but also pay more— which way the scale tips will determine the success of the act.
And what do the actual providers of this act think? Contrary to popular belief, many doctors are impartial to the act, seeing a decrease in their average salary offset by the emergence of a free market environment. This performance-based financing creates the possibility for individual attainment of a higher salary. The driving-force behind the act stands on this principle that independent individual interest will steer the market towards higher efficiency at lower cost.
How this “driving force” will play out is ambiguous—it relies on the social determinants of the healthcare system. It is multifactorial, and no one can predict the outcome with certainty. As stated by Yale New Haven Hospital’s Dr. Howard Forman of diagnostic radiology, “We’re hoping hospitals and health plans and everybody [are] somehow going to work together and we’re going to come up with more cost-efficient ways to deliver the same type of care. And there’s every reason to believe that we could accomplish that, but it’s also possible that it’s not going to happen.” The implications lie largely undiscovered, and will require an effort on our part to ensure its survival.
What does the Affordable Care Act mean for us—the entire nation? Decreased overall costs, and exorbitant short-term costs. It remains to be seen whether the ACA will reach the bottom of America’s wallet before its benefits are realized.
– Ethan Brill
Ethan Brill is a sophomore in Morse College at Yale University.
