January 1, 2014

Highlights of American health care system - Then and Now

The Patient Protection and Affordable Care Act (PPACA) came into being on March 23, 2010. The law offers hope for the 30 million uninsured Americans. The following are some highlights of the prevailing system of health care in the US and the new measure rolled out on New Year.

The present scenario

  • Health care facilities in the US are mostly owned and operated by the private sector.
  • Most of population under 65 is insured by their or a family member's employer, some buy health insurance on their own, and the remainder are uninsured.
  • Govt employees are covered by Govt insurance.
  • US has the highest infant mortality and deaths due to major diseases.
  • In WHO and other reports, US has a low ranking in health care quality but ranks high in cost.
  • Healthcare per capita is over $8,000.
  • 50,000 people die in the US for lack of insurance.
  • There is no Govt guarantee of health care to citizens.
  • The existing system doesn't deliver value for the money spent.
  • There is no national level system, but there are local Govt-owned facilities for the public.
  • The Govt takes the burden of 50% of investment for medical research, making US the leader in medical innovations leading to breakthroughs and substantial revenues.
  • The Federal Dept of Health and Human Service oversees various Federal health agencies.
  • Under a 1986 Federal law, emergency care is provided to even the uninsured, free, by all hospitals, but not compensated fully by the Govt.
  • The US is high ranked for medical responsiveness, but low in performance.
  • Health care spending is highest.
  • Uninsured people delay treatment and result in emergencies, costing more to the Govt in terms of compensation to the hospitals. They are twice likely to visit emergencies. Part of the expense is passed on to the insured by way of increased premiums.
  • Cost-effective treatments are not done, overutilizations occur.
  • Unnecessary treatments are rampant.
  • Wastage of materials and overuse of equipments very high.
  • There is overuse of medical benefits as well. The system tries to overcome this by co-sharing tactics like co-pays and deductibles.
  • America's health care system has been fragmented, increasing patient frustration.
  • Sometimes hospitalists are mandated by insureres to cut cost.
  • The administrative cost of insurer is about 12 %
  • According to a PriceWaterhouseCoopers study, increased utilization and new treatments are the primary drivers of rising health care costs in the US.
  • Under-insurance also a cause of unwanted deaths.
  • Five million of the uninsured stay so as they are barred due to pre-existing conditions.
  • Consumers have little recourse for complaints as pharmaceuticals and equipment manufacturers have protection from lawsuits.
  • Insurance and healthcare industry lobbyists block any reforms
  • In other countires, national Govt-funded system produces better outcomes at lower cost. This social medicine is not favoured in US. Example is Britain for socialised medical care.
  • Without safeguards, market-based packages are posing danger to people's health.
  • Single-payer health care system is debated.
  • Medicare: The 1965 Federal Govt social insurance program gives medical insurance for certain categories of disadvantaged people like senion citizens and needy children. It is paid for by payroll deductions.
  • Medicaid: Launched same year was for blind, aged, diabled, pregnant women and such others. It was a Govt insurance program for all whose income insufficient to pay for premiums. Managed jointly by the states and the Federal Govt.
  • Medicaid in 2009 covered 50 million and the Federal Govt paid 57 % of $300billion expenditure.

Features of the new dispensation - The Affordable Care Act

  • The ACA includes a large number of healthcare related provisions like expanding Medicaid eligibility for people making up to 133 % of FPL, and subsidising premiums for those making up to 400% of FPL. Their maximum out of pocket pay will be from 2 to 9.8 % of income for annual premium. There are also incentives for businesses as well. The costs for the Govt are offset by a variety of taxes.
  • Based on 2013 dollar, the subsidy would apply for incomes up to $45,960 for an individual or $94,200 for a family of four.
  • Many states have opted to continue with current Medicaid funding levels and eligibility standards.
  • The Federal Govt will pay 100% of the cost of the increased Medicaid eligibility expansion, reducing over the years.
  • All individuals not covered by employer insurance, Medicare or Medicaid or other public insure programs, are mandated to take an approved private insurance policy or pay penalty.
  • Health insurance exchange is an online marketplace consisting a website, Healthcare.gov, where one compares plans and buys.
  • First year operation enrollment was to run from Oct 1, 2013, to March 31, 2014. The original deadline for coverage from Jan 1, 2014 was Dec 15, but extencded to 23, then 24, now Dec 31 because of website glitches. Next year it starts on Oct 15 till Dec 7.
  • Under the law, Obamacare will force the industry to sell medicines cheaper
  • The consumers can choose to receive their tax credits in advance, and the exchange will send the money directly to the insurer every month.
  • Employer mandate: Businesses which employ 50 or more people but do not offer health insurance to their full-time employees will pay a tax penalty
  • ACA drafters believed that increasing insurance coverage would only improve quality of life.
  • The ACA extends health care coverage to uninsured Americans who number 30 millions.
  • About seven per cent of Americans are expected to enroll at the new health insurance Marketplaces.
  • The Marketplace will allow consumers to compare prices on insurance packages of insurers.
  • Enrollment of more young people will bring down premium burden on elders.
  • Everyone will have to carry a minimum amount of health insurance or pay a fine, but with some exceptions.
  • Most GOP and some other states are not running the Marketplace.
  • The supreme court has ruled the states have the choice to adopt Obamacare or not.
  • During its first 24 hours, HealthCare.gov, the website which is the Marketplace, got more traffic than Twitter did in its fist 24 months.
  • A few like Kentucky and Connecticut have enrolled people without glitches.
  • Since year-end, there is surge in enrollments, insurers say.
  • The marketplace had a botched rollout since day one, Oct. 1
  • Such a dramatic expansion in coverage had eluded several Presidents, Republican and Dems
  • A major relief for consumers is that insurers cannot turn away consumers with pre-existing conditions.
  • One said it's light at the end of a long dark tunnel.
  • Among the people who will remain uninsured are: Illegal immigrants, citizens not enrolled in medicaid despite being eligible, citizens not otherwise covered and opting to pay the annual penalty, citizens who live in states that opt out of the Medicaid expansion and who qualify for neither.
  • Exchanges operated by the Federal government crashed on opening and suffered from a rash of problems since - www.HealthCare.gov
  • ACA itself remains controversial, opinions being aired on party lines. Most Dems favour the law, while Repubs and Independents generally do not.
  • The reform did not go far enough, some say.
  • Many Democrats believe that the ACA will grow more popular over time, like Medicare did after its implementation.
  • The term "Obamacare" was coined by opponents of the Affordable Care Act as a pejorative term. It was first used by healthcare lobbyist Jeanne Schulte Scott in a health industry journal.
  • The 2013 Federal government shutdown marked an unprecedented style of opposition protest demanding a delay in the implementation of the ACA.
  • After all the hiccups and glitches, the New Year sees a surge in enrollments.

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