The current discussion of what to do about the Patient Protection and Affordable Care Act (PPACA) is a prime of example of how much easier it is to pass an inherently flawed law than it is to either repeal or replace it.
Is the PPACA as bad as it is portrayed? Is it fixable with modifications, or is there something new that must replace it?
The Republican Party has taken up this heavy gauntlet, thrown down by the Democrats in 2010, and they will own whatever they subsequently do.
While the aims of PPACA were broad and touched on nearly every conceivable aspect of health care – including types of health insurance plans; responsibilities of insurers; primary preventive care; supporting and expanding the health care provider workforce; and curbing unbridled costs of pharmaceuticals – the realities have been strikingly different.
Health care providers, hospitals, patients and businesses have suffered “sticker shock” that stemmed from the PPACA’s legal provisions and their unintended consequences. Once the law began its implementation in 2013, many Americans soon discovered that their health plans did not meet the new standards and, under the individual mandate, had to be replaced with new ones often more expensive and containing services that they would never need.
Hospitals and health care providers were saddled with numerous requirements that increased their cost of doing business, and these were costs that could not be passed on to consumers. Payment structures for many services were reduced, and the resulting loss of revenues, unlike the case for conventional businesses, could not be written off when paying federal or state taxes.
Large insurers, experiencing huge losses, abandoned state health exchanges, and consumer premiums rose because of lack of competition. Taxpayers saw premiums increase to subsidize those whose plans received federal assistance.
The creation of narrow networks became a de facto means to ration the provision of health care by lengthening the queues of patients seeking physician visits. Hospitals have closed; physicians have abandoned their practices; and the commitment to expand the health care workforce has turned into a largely empty promise.
One of the stickiest points in the PPACA was the individual mandate to have a demonstrable health care plan. The enforcement of this provision was administered by the IRS, and consisted of a tax penalty unless a Form 1095 could be produced documenting the ownership of such a plan.
The actual penalty for many young and healthy people was so low that it made more sense to accept it and defer purchasing a healthcare plan until a situation arose when health care was needed.
A Feb. 27 op-ed piece by Harvard business professor Regina Herzlinger et. al., appeared in the Journal of the American Medical Association. This article examined how Switzerland, Singapore and Germany have made universal health care funding work by applying much harsher financial penalties for individuals’ failure to purchase health care insurance.
However, these countries are much smaller than the United States; have smaller percentages of gross domestic product involved in health care expenditures; and have many more insurers competing for consumers’ monies.
As the Republican Party takes the PPACA to task and seeks an alternative law, they need to consider the following points (among many others), as the current bill contains nearly 1,000 pages and more than 10,000 sections:
Perform a best- and worst-case cost/benefit analysis of the PPACA and come up with the provisions that are affordable with our current tax revenues and the contributions of businesses and individuals to make up the difference.
The individual mandate failed to support the financial requirements of the health exchanges. Either dispense with it altogether or make it stringent enough to be effective.
Enable individuals, families and businesses to purchase healthcare plans across state lines that only include services that they actually will need.
Give relief for some of the onerous requirements placed on physicians and hospitals that raised operating costs and reduced revenues.
Provide meaningful federal oversight on the rising costs of pharmaceutical agents and medical devices.
Add tort reform to reduce the huge cost of practicing unnecessary defensive medicine.
Increase substantially the support for more residency training positions to alleviate the growing shortage of physicians.
Allow medical practices and hospitals to get more tax relief for business losses.
I am not at all certain that this process of reform will be smooth or that it will result in an improved piece of legislation that most of us can live with. I am certain that continuing with the present law eventually will bankrupt the American health care system; drive more hospitals and physicians out of business; and eviscerate the quality and quantity of care that we currently receive.
This is another case of the Titanic approaching the iceberg full speed ahead, believing that it is “unsinkable” – and we all know how that turned out.
If new Secretary of Health and Human Services Dr. Tom Price is smart, he will seek advice from health care policy experts who are nonpartisan, and begin the process of truly informed legislative reform rather than the irrational rush to judgment that currently is being entertained.
(The writer is an Augusta obstetrician and gynecologist.)