Now that we are about to have a new President and administration, changes in the Affordable care Act (ACA) are inevitable, but what should they be? What are the problems that beg solution?
Private insurers who are covering about ten million Americans under the ACA are losing money even though all people without health coverage through their employer, on their own or through the federal government are required to sign up for coverage. The idea was that there would be enough healthy applicants to offset the cost of covering people with serious medical preconditions like heart disease and cancer. But there aren’t and there probably never could be enough. If one unhealthy patient needs life saving treatment like a heart transplant or extensive cancer treatment, it could cost millions of dollars. One healthy patient might pay $2,000 a year. It would take 500 healthy patients to pay for each unhealthy one like this.
But the ACA wanted to end the use of preconditions in evaluating coverage and so they thought that making everyone get it would offset their cost. In order to enforce signups, those who did not sign up were to be charged penalties. They are now up to 2% of annual income.
Now that private insurers are withdrawing from the markets, one in five applicants will have only one private insurer to choose from, which is no choice at all. And the plans include high deductibles making it unlikely that the insured will ever get any benefit unless there is a catastrophic injury or illness.
The majority of Americans do not like the ACA and want the new President to fix it. I have a suggestion for a way to make coverage voluntary, less expensive, and without deductibles.
First let all private insurers reject any applicant for medical reasons. Those rejected would immediately be eligible to the “public option” which will be a government-run program similar to Medicare and Medicaid. There will be a share of cost and there will be no deductibles. Those with low incomes who would be eligible to Medicaid, had their states expended the coverage under the ACA, would also receive the public option but with no share of cost.
Private insurers would lose some customers because they would not have to sign up. But the low income people who are not now able to get Medicaid in their state would make up for the lost enrollment by getting the public option.
Private insurers would have to compete for the healthy applicants who are no longer a captive audience. Insurers would have to offer competitive rates mindful that they could not use deductibles to avoid the first $5,000 of medical costs, more than most healthy members use.
Since getting coverage would no longer be mandatory, there would be no fines for non compliance as there are now.
And, yes, the taxpayer would have to pay the cost of these high risk patients, but we do anyway. The government has been reimbursing/ subsidizing both the rate payers and the insurers. Currently 5% of the population uses 50% of our healthcare dollars. The government needs to find ways to reduce these costs with changes in diets, exercise regimes, early interventions, drug and surgical treatments and in end -of-life decisions. In a sense, these high cost individuals are society’s responsibility since most have suffered poverty and its associated problems.
The result should make everyone happy. People with preconditions will always have coverage. People who cannot afford coverage and live in states that did not expand Medicaid, will have coverage. Those who do not want coverage do not have to get any. There will be no penalties for non-compliance.
Private insurers would provide more coverage for less and still make a profit.
The progressives will be happy to see a public option that could grow over time, not to compete with private companies but to complement them.
Conservatives will be happy because coverage will not be mandatory and the private option will be maintained, will not be threatened by single payer universal coverage, also known as socialized medicine.
Problem solved!
Private insurers who are covering about ten million Americans under the ACA are losing money even though all people without health coverage through their employer, on their own or through the federal government are required to sign up for coverage. The idea was that there would be enough healthy applicants to offset the cost of covering people with serious medical preconditions like heart disease and cancer. But there aren’t and there probably never could be enough. If one unhealthy patient needs life saving treatment like a heart transplant or extensive cancer treatment, it could cost millions of dollars. One healthy patient might pay $2,000 a year. It would take 500 healthy patients to pay for each unhealthy one like this.
But the ACA wanted to end the use of preconditions in evaluating coverage and so they thought that making everyone get it would offset their cost. In order to enforce signups, those who did not sign up were to be charged penalties. They are now up to 2% of annual income.
Now that private insurers are withdrawing from the markets, one in five applicants will have only one private insurer to choose from, which is no choice at all. And the plans include high deductibles making it unlikely that the insured will ever get any benefit unless there is a catastrophic injury or illness.
The majority of Americans do not like the ACA and want the new President to fix it. I have a suggestion for a way to make coverage voluntary, less expensive, and without deductibles.
First let all private insurers reject any applicant for medical reasons. Those rejected would immediately be eligible to the “public option” which will be a government-run program similar to Medicare and Medicaid. There will be a share of cost and there will be no deductibles. Those with low incomes who would be eligible to Medicaid, had their states expended the coverage under the ACA, would also receive the public option but with no share of cost.
Private insurers would lose some customers because they would not have to sign up. But the low income people who are not now able to get Medicaid in their state would make up for the lost enrollment by getting the public option.
Private insurers would have to compete for the healthy applicants who are no longer a captive audience. Insurers would have to offer competitive rates mindful that they could not use deductibles to avoid the first $5,000 of medical costs, more than most healthy members use.
Since getting coverage would no longer be mandatory, there would be no fines for non compliance as there are now.
And, yes, the taxpayer would have to pay the cost of these high risk patients, but we do anyway. The government has been reimbursing/ subsidizing both the rate payers and the insurers. Currently 5% of the population uses 50% of our healthcare dollars. The government needs to find ways to reduce these costs with changes in diets, exercise regimes, early interventions, drug and surgical treatments and in end -of-life decisions. In a sense, these high cost individuals are society’s responsibility since most have suffered poverty and its associated problems.
The result should make everyone happy. People with preconditions will always have coverage. People who cannot afford coverage and live in states that did not expand Medicaid, will have coverage. Those who do not want coverage do not have to get any. There will be no penalties for non-compliance.
Private insurers would provide more coverage for less and still make a profit.
The progressives will be happy to see a public option that could grow over time, not to compete with private companies but to complement them.
Conservatives will be happy because coverage will not be mandatory and the private option will be maintained, will not be threatened by single payer universal coverage, also known as socialized medicine.
Problem solved!
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