Question :
For this assignment, you will select a topic (see list below for possible topics) and identify an existing federal health policy problem in that area. Then develop a paper that addresses the following:
A good starting point is to analyze a current issue pertinent to Patient Protection and Affordable Care Act (PPACA). Possible topics include the following:
Your well-written paper should be twelve pages in length and conform to CSU-Global Guide to Writing and APA Requirements. Include five to eight current scholarly references (not more than five years old) in addition to the course textbook. Remember that you must support your thinking/opinions and prior knowledge with references; all facts must be supported; in-text references used throughout the assignment must be included in an APA-formatted reference list. You should also consider additional reference articles from the popular press such as the Wall Street Journal and Washington Post. The CSU-Global Library is a good place to find these references. Before developing your paper, review the grading rubric.
On March 23, 2010, the U.S. President Barack Obama signed the first US comprehensive health care reform bill, the PPACA (Patient Protection and Affordable Care Act) into law after repeated attempts and failures by the previous Presidents of the United States of America. In 2008, an estimated 46.3 million US individuals were uninsured and a further 25 million were underinsured (Connors and Gostin, 2010). The PPACA was proposed to expand health insurance coverage to more individuals through a variety of schemes and measures. According to the act, state-level health insurance exchanges were to be created under the PPACA and they were to play a major role in sale and purchase of health insurance when the act became operational. The purpose of this report is to focus on the health insurance coverage issues pertinent to the Patient Protection and Affordable Care Act (PPACA). And further examines how the issues can be addressed effectively by the PPACA.
To make insurance affordable to people of all statures, PPACA offers sliding-scale subsidies and limits out of the pocket spending. And to increase the number of increased individuals, the premium rates were lowered and it was proposed that individuals without insurance coverage will pay a penalty of 695 USD or 2.5% of household income. One of the important features of the PPACA was to expand Medicaid to individuals with comes of up to 133% of the Federal poverty level and thus covering low income adults without children who were previously not eligible for coverage by Medicaid. This offers standardized benefits of Medicaid and a minimum package of essential services (Connors and Gostin, 2010).
Another important feature was the plan to establish state-level health insurance exchanges. American Health Benefit Exchanges and Small Business Health Operations Program (SHOP) Exchanges were to be formed in all states and would act as market places for consumers to shop for and purchase health insurance at affordable rates. These exchanges would provide the consumer with the necessary details, and private health insurance choices. Low-income US citizens who are not eligible for coverage under Medicaid were offered private health insurance benefits through these exchanges by providing with subsidies and credits for premiums. For small businesses with fewer than hundred employees, tax credits were provided for offering insurance.
The PPACA prohibits the insurers from limiting or denying insurance coverage to children under nineteen with pre-existing medical conditions and allows young adults under the age of twenty six to remain covered under their parents’ health plan. It ends insurers’ ability to withdraw coverage due to an honest mistake made on part of the insured, restricts annual limits and eliminates life time amount that insurance will pay for certain conditions. The PPACA offers a rebate of 250 USD to Medicare part D enrolees efficiently closing the coverage gap in Medicare part D.
The state-level health insurance exchanges play the central role in the private health insurance reform of the Patient Protection and Affordable Care Act (PPACA). The functioning of these exchanges as planned is mandatory for expanding health insurance coverage in the US, improve the quality of coverage and health care in the nation and reduce the cost of health care. But there are some issues that the Federal and state governments face in implementing these health insurance exchanges. The Commonwealth Fund, in its report has mentioned eight issues in implementing these exchanges that include: the proper governance of the exchanges, adverse selection (against and within the exchanges), ways to make self-funded insurance plans compatible with the exchanges, ways to make the exchanges attractive to employers, exercising of regulatory authority by exchanges, type of information made available to consumers and employers by these exchanges, ways to determine eligibility, ways to reduce the administrative costs, costs of their uses and attract funding (Jost, 2010).
The exchanges in each state could be outsourced to a private agency under the PPACA for some of its functions such as managing the website, processing enrolments and premium payments while certification activities are inherent government functions. Any publicly run exchange is subject to the state administrative and operational laws but it is important that the health insurance exchanges be flexible and agile to react quickly to market change concerned with insurance. So the state administrative and operational laws can be made flexible with respect to these exchanges. But again it is important that public law pertaining to ensure transparency, public participation and to avoid corruption must apply so that the management is apolitical and professional. Exchanges can also outsource mechanical, non-discretionary functions such as premium billing, premium collections, data processing and customer services to private agencies.
It is important to avoid adverse selection both against and within the exchanges. It is one of the greatest issues the exchanges face. State regulation of an individual as well as small-business market outside of these exchanges should also be identical to the corresponding regulation inside the exchanges to an extent. It is necessary to retain a range of coverage choice within the exchange that would appeal to variety of population. By this way, it is possible to eliminate the coverage market outside of the state-level exchanges. An efficient risk adjustment system to eliminate adverse selection within and against the exchange among participating insurers and non-participating insurers must be designed by the HHS (Baker, 2011).
In addition to focussing on serving the needs of individual customers, it is also important that these exchanges take care of the relationship between the insurers, the employers and the employees. It is mandatory for the exchanges to make available qualified health plans for the employers qualified for coverage. In a provision called the SHOP (Small Business Health Option Program) exchange, it is required small employers be assisted in enrolling their employees for health plans offered in the small business market. And to overcome adverse selection issues, the exchanges in the state have to have a maximum number of enrolees which is possible only if they enrol both individual customers as well as employees of small business employers. This is possible only when the packages are made attractive to the employers and actively marketed.
Possible recommendations include offer of aggregated bill to small business employers when they enrol their employees. The aggregated bill must cover the premiums of all the employees of the firm. Or allow the employers to pay a percentage of the premium required with the employee paying the rest. Lower-income employees can be offered greater support by their employers.
The PPACA permits the exchanges to offer only qualified health insurance plans. And it is mandatory that these plans meet all the regulatory requirements on the health insurance issuers imposed by the PPACA both in the individual market as well the small group market. It must also meet certain additional requirements such as accreditation, marketing, adequacy and quality improvement (Rosenbaum, 2011). And certification of a health plan is possible only if the plan determines that the particular plan through the exchange is in best interests of the qualified individuals or small business employers in that particular state. And according to the act, the exchanges have no rights to deny certifying a plan because it is fee for service kind of plan and they have no right to impose price controls.
The state-level exchanges can make use of their certifying power to make sure that the health plans offered meet all the statutory requirements for qualifying and that they do not impose unrequited premium increase on their customers. The state exchanges should be given the option of being an active purchaser by the legislation authorizing them and must not impose all insurers in the market on them.
The clear description of the benefits and limitations of any particular health insurance plan must be made readily available and accessible easily. The opinions of the participating members must be taken into account and come up with plans that are satisfying to those who have serious health or financial problems. The opinions of the employers must be valued too.
Under the PPACA, the Medicaid eligibility expands dramatically (Hofer, Abraham, & Moscovice, 2011). The consumers, be it individuals or families that approach the exchanges usually need financial assistance in purchasing health plans. Medicaid assistance is available for those with an income level of up to 133% of Federal poverty level. Children with pre-existing medical conditions up to the age of 19 in general and in some states up to 21 are covered under CHIP (Children’s Health Insurance Program). Children are eligible under CHIP if their families have income level of 200% of the poverty level and more in some states. Sometimes parents receive premium tax credits while the children are covered under Medicaid or CHIP for income of 400% of poverty level.
It is mandatory that the subsidy determination process doesn’t stand in the way of those who are unsubsidized. The insurers market outside of the exchange will continue to be available for those who are not entitled to the subsidy. These individuals must be given a fair chance and choices to completely fore go the subsidy application process or if they choose to apply with the exchange then they shouldn’t be put through too much screening so that they do not face any impediments. It is the responsibility of the exchange to take care of the continued enrolment of individuals for health plans and tax credits.
One of the prime purposes and hopes of advocates in relation to the PPACA is that establishment of health insurance exchanges would reduce the cost of health care spending and health insurance. But in the long run, especially during recession and after the global economic crisis and when the rates are in excess of the rate of growth of the economy, this kind of cost reductions is not sustainable. In order to succeed the exchanges should be able to offer competitive health insurance plans. That is, plans offered by the exchanges must provide as much value for money as the insurance plans available in outside in the non-exchange market. The plans are all qualified health plans and thus of very high quality but the key factor that determines whether or not an individual takes up the plan offered by them is the premium that is required to be paid (Jost, 2010). And these exchanges will have an important role in creating, managing and rating the plans. Also they have regulatory responsibilities that will require resources.
Administrative costs can also be kept nominal in addition to providing high quality services. This can be done by motivating insurers to offer premium rates in the exchange lower than those available outside by providing the insurers with large exchange market enough for others to cut down on their premiums. Further, exchanges could perform functions such as enrolling participants, subsidy application and determination process, web portal management, premium collection and marketing further reducing the administrative costs. Another cost saving measure that exchanges can do is to try to eliminate insurance agents’ and brokers’ commissions.
The exchanges must be attractive to the employers. This can be done by coordinating care using quality improvement strategies, reducing the use of unnecessary care and thus reducing the costs.
The PPACA embodies a new social contract of health care, with the government as the insurer for the people below poverty line and the elderly through markets, individual responsibility, choices and private ownership. It embodies a fair share approach to health care financing (Baker, 2011). In case of Affordable Care Act, the deserving poor concept was eliminated from the Medicaid standards. One’s ability to pay for health insurance will now matter more than it did before. In the face of rising health care costs and increasing financial inequality this was an incremental step. It point towards individuals to be as healthy as they can as envisioned by what the act mentions as ‘individual responsibility’.
It is important that the exchanges maintain maximum number of enrolees and have an increased percentage of consumers participating in health insurance plans through them rather than through external agencies. This will result in the exchanges holding greater market power, greater economies of scale, lessened risk pools and increased stability.
The PPACA’s health care exchanges offer the consumers structures choices of health care plans. An important decision would be to consider their views and decide upon whether to further the existing structured choices or offer greater flexibility in the plans.
In the PPACA, the patient reforms bill passed by US will moderate the effect that unemployment rate has on the probability of insurance coverage (Cawley, Moriya, & Simon, 2013). The Act has incentives that employers can offer employees; it provides subsidies for coverage of families with low income. There may be a slight increase in the unemployment rate though not very significant changes.
The PPACA must clarify to what extent it pre-empts in general the state reform initiatives and in particular the employer mandates. Otherwise, the already impenetrable ERISA pre-emption would have been made more complicated the Congress’s PPACA (Chirba, 2010).
There are three dominant conceptions of health insurance. The first is that health insurance primarily serves to tackle harms to health making health insurance a means to pay for health care that prevents and improves health problems most cost effectively. The second is financial security where in health insurance is something that is used to mitigate loss of wealth from high health care costs. Finally, being highly sensitive to the possibility of adverse effects and using health insurance as something to primarily protect against unavoidable or sudden health risks. This, known as the Brute Luck theory seeks to preserve incentives by the individuals to prevent risk. The premium pricing is based on guidelines from these theories. This Conceptual pluralism (Hoffman, 2011) is manifested by the Patient Protection and Affordable Care Act and it complicates the implementation of the act as it requires the regulators to manage tensions and make trade-offs among the goals. When translated into policies, the three theories will at times conflict each other creating discordance.
People in the US are generally ambivalent about their views on the reform bill. This can be greatly attributed to the complexity of the law. Very few people including physicians truly understand the true purpose of the law. Another reason may be that people identify with the three conceptual insurance policies and while they support one concept they are not very much in favour of the others. But eliminating this conceptual pluralism isn’t advisable either because it would make the theory not likeable to those in favour of the neglected conception. The best regulatory method would be to prioritize which conceptions are to be used but not necessarily stick to just one and eliminate the others.
The phrase in the law stipulating subsidies to help those with incomes less than 400 percent of poverty line is available only in the exchanges established by the state came into a controversy quite recently. It was argued that the rest of the act states that subsidies would be available for both state run and Federal run exchanges. Since most of the states opted let the federal government run their agencies, this phrase could mean making insurance unaffordable for millions of people and threaten the law’s viability in the entire act. There are four pending cases in the Supreme Court pertaining to the IRS rule in Patient Protection and Affordable care Act authorizing tax credits and cost-sharing subsidies to purchase health insurance in federal-level health insurance exchanges (The Washington Post).
Conclusion
Affording everyone the right to quality health care irrespective of income or health status is a definitely an excellent idea. It should become a widely shared social norm, as it is in a lot of other countries. The implementers of the Affordable Care Act have great power to shape the future of health insurance and medical care in US. Attention on choices needed to curtail increasing costs, improving the quality, and changing of physician and hospital incentive structures are crucial aspects of the reform bill that will have to be carefully governed to have powerful effects on the economy and the population’s health and these cannot be ignored by US government.
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