With less than eight weeks to go before we (hopefully) reelect President Obama, I was confronted with a Republibot yesterday that just plain made my mind numb. She's on Medicare, and because she's a Romney supporter with all her might, she has convinced herself that Obamacare will do great harm to Medicare, and that it's all around just really evil. She actually said, (and I'm not making this up. I wish I was.) "I don't want a panel of 12 people deciding..." I cut her off, knowing she was talking about "death panels."
I can't believe anyone still believes there will be death panels in Obamacare. But since there obviously are, this piece became necessary. In this piece, you will find out what is in Obamacare, and why it makes our helth care system better.
Look, folks, it's this simple. Two and a half years ago, President Obama signed into law the most sweeping change to our health insurance system ever. It needs improvement; I will not argue that at all. But overall, it's a very progressive law.
This law does a lot for people,and not just because it will make insurance available to those who haven't carried a policy for years. Even those who have the same plan they've had for years will see major improvements in their coverage.
Let's recap how the old system worked.
You paid for insurance for years, and as long as you didn’t use it, the insurance company would assure you that you were covered. They’d pay part of your routine doctor visits, and minor procedures, but if you or a family member actually got sick enough to need extensive or chronic care, you'd face a major battle to get them to use your money to pay forit. They made a profit by spending as little of their policyholders’ money -- again, your money -- as possible. In recent years, insurance companies would only insure healthy people, and they’d refuse to pay for procedures they decided cost them “too much.”They refused to insure many people who actually needed medical care. Basically, we had a system in which those who needed the most health care were actually not allowed to contribute to insurance pool, and they had no access to medical care except in emergency. Many of them had paid tens of thousands of dollars into the health insurance system over the years, but since they were forbidden from paying THIS YEAR, they had no coverage, and they could only get care through the ER.
Of course, after going to the ER, many were sent bills they couldn’t possibly pay, and didn't. Since hospitals can’t work for free, they increased prices to make up for the money they didn’t collect. That meant insurance companies would raise premiums and remove more potentially sick people off their rolls. Of course, that meant more uninsured people needing more high-priced unpaid-for care, meaning even higher premiums and more uninsured, and more unpaid bills, then still higher premiums, more uninsured, more unpaid bills, higher premiums and more uninsured and…
I hope you can see the problem in the above. The health care financing system was in a death spiral. Contrary to what the right wing wants us to believe, health care is not a market-based product. You can't choose when you need it, how much you'll need or what it will cost. So treating health care as if it was the same as a loaf of bread or a car simply doesn't work.
Until 2014, we will be the only industrialized nation in the world without a comprehensive national health insurance plan. Even then, we will still have a way to go to get us universal care. But before the ACA passed, more than 40 million people had no health insurance and no access to coverage. When it’s fully implemented, that number will be down to around 8 million. Within a few years after that, with a little patience and a lot of support, we can have a universal health care plan.
The ACA is excellent legislation, not just because it provides coverage to more people, but also because It makes health insurance work better for everyone. Keep in mind as you read all of this; the more people are covered, the more bills are paid, and the lower premiums stay
Here are some of the basic provisions that make everyone’s insurance better:
- Children can be on their parents' health insurance until they turn 26. This allows children coverage through college, and allows new graduates time to find a good-paying job with insurance coverage. So far, 2.5 million adults have coverage because they were able to go back onto their parents’ plans.
- Health insurance companies can no longer impose lifetime dollar limits on health care.
- Annual spending caps have been severely restricted and by 2014, they will be prohibited altogether. You can no longer get "too sick."
- Insurance companies will no longer be able to cancel insurance because policyholders get sick.
- All new health insurance plans created since September 23, 2010 must pay 100% of costs (no deductibles and co-pays) for most types of preventive care, including for conditions such as cancer and diabetes. They must also provide full coverage for all vaccines, and well-baby and pediatric visits.
- Beginning August 1 of this year, preventive care coverage expanded to include most preventive care for women, screening for gestational diabetes and HPV, and screening and counseling for HIV. As many of you may have heard, contraception will also be covered.
- All insurance companies must provide for a quick and painless claims and coverage appeal process.
- Beginning in 2014, insurance companies will be no longer able to deny coverage or claims based on pre-existing conditions. Even before 2014, the ACA provides insurance to those people with pre-existing conditions who have been uninsured for six months or more. These PCIPs already cover more than 50,000 people, most of whom are women.
- The ACA establishes a special health insurance program to provide benefits for early retirees aged 55-64.
- When fully implemented in 2014, insurance companies will no longer be able to charge women higher premiums than men.Currently, according to the National Women’s Law Center, women who buy insurance on the individual market pay $1 billion more than men.
- Beginning in 2015, payments to doctors will be based on the quality of care, not volume.
For those of you still complaining because the ACA didn’t include a “public option,” be assured, it’s coming.A number of provisions in the law will probably create a situation in which the insurance companies themselves will demand a public option. Consider the changes above, and consider them along with some of the other changes the ACA makes in the insurance industry:
- Beginning in 2014, Medicaid eligibility will be expanded to cover all individuals with income up to 133% of the poverty line, including adults without dependent children. That means everyone making up to about $30,000 will be eligible. Many Republican governors are resisting this, and threatening to refuse the money, but how long do you think they'll hold out?
- The ACA will establish health insurance exchanges, from which individuals making up to 400% of the poverty line will be able to purchase insurance that is subsidized through a refundable tax credit.
- For-profit Insurance companies are now required to spend at least 80% of premium revenue on health care, with any excess returned to individual policyholders in the form of a rebate.
- Non-profit health insurers, like Blue Cross don’t escape scrutiny, either, as they must now spend at least 85% of premiums on health care in order to take advantage of federal tax benefits.
Insurance companies live and die based on risk pools. The greater the risk they have to take on, the harder it is to make a profit. Keep in mind; before Obamacare, they used to maximize profits by denying coverage to anyone who might actually need health care. Thanks to the ACA, beginning in 2014, they have to accept everyone who wants to buy a policy, regardless of pre-existing conditions, and they can’t cut anyone off when they get sick. They also won’t be able to set annual or lifetime coverage limits. At the same time, they have to spend 80%-85% of premiums on health care, which means they are extremely limited with regard to the amount they can spend on administrative costs (including executive bonuses) and take out in profits. Higher risk pools and a a limited 15-20% of revenue to squeeze a profit from, and they'll be demanding a "public option."
And for you seniors worried about Medicare, Obamacare actually strengthens Medicare the following ways:
- You've heard about the “donut hole” in the Medicare prescription drug program, Part D? Obamacare gradually closes the donut hole until it completely disappears in 2020. Last year alone, 3.6 million Medicare beneficiaries saved an average of $600 per person.
- Because of Obamacare, Medicare now offers a long list of preventive health services with no out-of-pocket costs because it eliminates coinsurance and deductibles on a number of vital preventive health services. By 2018, all preventive services will be 100% covered by Medicare.
- The ACA entitles Medicare beneficiaries to annual wellness visits, to allow patients and doctors to develop a health plan based on current health and risk factors.
- Financial incentives in the ACA will likely lead to better Medicare Advantage plans for seniors, as well. Such plans will receive a rating under a five-star system, and those receiving three or more stars will receive bonuses. That means all insurance companies will strive for more than three stars. But it gets better, because those plans receiving five stars will be able to market policies year-round, and not just during the fall open enrollment period. That means seniors will be able to switch plans at any time, which will incentivize insurers to provide better quality service.
- Medicare coverage has been extended to health care facilities with a small number of Medicare patients, such as hospitals and clinics in rural areas.
- The ACA toughens federal sentencing guidelines for Medicare fraud, allows for the suspension of payments to providers suspected for fraud.
- New screening procedures, similar to those undertaken by credit card companies to combat fraud, will be implemented to combat abuse and waste in all health insurance programs.
- Beginning next year, the ACA will create the Community Living Assistance Services and Supports (CLASS) program; the first federal, voluntary long term care insurance program in the country’s history. Historically, long-term care was only available through individual policies purchased in the private insurance market, or Medicaid, once an individual’s savings have been depleted. The CLASS program will provide working adults who have been in the program at least five years with a cash benefit, so that they can afford care while they continue living at home.
- The ACA provides states with additional funding to expand resources for aging and disability, to provide information on available care options.
- There are no death panels. What Obamacare does provide is coverage for end-of-life consultations with medical professionals. That's not available just to Medicare recipients, but to anyone needing such services.
Put simply, the Affordable Care Act strengthens Medicare in ways that will make it even more difficult for Republicans to kill it. Also, strengthening it will increase the appeal of the program, and quite possibly set it up as an irresistible version of the “public option” so many claim as essential to a successful universal health care plan.
Here are a few more things the ACA does:
- Established a temporary credit of up to $1 billion to encourage investment in new therapies for disease prevention and treatment.
- Established a National Health Care Workforce Commission, a National Center for Health Care Workforce Analysis, and a State Health Care Workforce Development Grant Program, all of which will combine to create a comprehensive system to establish policies for development of a comprehensive health care workforce and to direct caregivers to those areas with the greatest need. Currently, there are shortages of caregivers in geriatrics and long term care workers, for example, and these programs will inform Congress as to the best ways to address such issues, and make sure sufficient care is available everywhere it’s needed.
- Small businesses, described as those with fewer than 50 employees, receive tax credits for up to 50% of employee premiums.
- Employers are now required to disclose the value of all provided health benefits on all W-2 forms.
Is the ACA perfect? Of course not. No single bill ever is. But it's damn good, and it improves our health insurance system enough that all we'll need to do going forward is to tweak it to make it better. It does a lot, and we need for everyone to know this.