Thursday, June 28, 2012

Good news for Obamacare, but not “full steam ahead”

By upholding the Affordable Care Act (aka “Obamacare”), the Supreme Court set aside the greatest single existential threat to the law: a finding that some or all of the law is unconstitutional. A ruling against it could have delayed achievement of the goal of providing near-universal health insurance coverage for at least another generation. More immediately, it would have introduced chaos into the system, as I blogged about (and CNN reported on today with a link to a KevinMD retweet of my post) back in April. A mixed verdict—overturning the health insurance mandate but keeping most of the rest of it—would have raised a whole host of practical concerns, including whether the subsidies, exchanges and insurance market rules survive with it.

As it was, the Supreme Court upheld the individual insurance requirement—defined as a “tax” in the majority opinion written by Chief Justice Roberts. Check out the SCOTUS blog for an excellent PLAIN ENGLISH explanation of the individual insurance ruling.

On Medicaid, though, the court upheld the part of the law that expands Medicaid to cover people up to 133 percent of the Federal Poverty Level—but removed the main penalty available for the federal government if a state doesn’t comply, which would have been a cutoff of all existing federal Medicaid dollars to non-compliant states. Instead, it leaves the “carrot” (more federal dollars for Medicaid: 100 percent initially, declining to 90 percent) but not the “stick” of a complete loss of Medicaid funds. This leaves the door open that some states will decline to expand their Medicaid programs to all of the poor and near-poor as the ACA intended.

Overall, though, the decision gives a green light to the ACA, meaning that the federal and state governments have no constitutional or legal reason to further delay implementation of the health insurance subsidies, insurance market reforms, individual insurance subsidies, essential benefits packages, delivery system reforms, or Medicare benefit improvements—that is, just about everything in the law.

As a result, the Supreme Court decision should result in tens of millions fewer uninsured persons in 2014, some 16 million through subsidized private health insurance, and up to another 17 million on Medicaid, depending on how many states go along with the Medicaid expansion. ACP, a long-time champion of universal health insurance coverage, said in a statement released today that the Supreme Court decision is a “victory for improving health care for all Americans.”

The law continues to face formidable challenges, however. Republicans insist that they will do everything in their power to repeal it, or at least to try to deny needed funding so as to slow down or impede its implementation. They won’t get too far, because the Senate and White House won’t go along. But the 2012 elections could change all of that.

It remains to be seen if the states—especially the 26 that brought the unsuccessful constitutional challenge to the Supreme Court—will continue to resist setting up the heath exchanges and preparing for more Medicaid patients, perhaps until after the 2012 elections, even though delay could put them in the precarious position of inviting the federal government to run their exchange if they haven’t made enough progress on their own by early next year. Governor Bob McDonnell of Virginia, chair of the Republican Governors Association, told NBC news that states are “stuck” with the law “at least until we see if we have a new Senate and a new president.”

Finally, the biggest challenge is that President Obama, congressional Democrats, and organizations that support the ACA have not yet persuaded a solid majority of the public on its merits. While large majorities favor many of the law’s specific improvements, “Fewer than half of Americans have supported the law in every major poll since its passage. A significant portion of this opposition comes from those who say the law did not go far enough,” according to a Washington Post article. The individual insurance requirement is supported by less than a third of the public. 

Still, despite the challenges, today is a day to celebrate the fact that Supreme Court ruled in a way that will allow most of the law to go forward, moving us closer to the goalpost of universal health insurance access for all and better consumer protections and benefits for everyone.

Today’s question: What is your reaction to the Supreme Court decision? What do you think it means for the future of the ACA?


Steve Lucas said...

This will be a major issue in the upcoming elections.

Business will be waiting for the November elections to see if they will continue to offer insurance to their employees. Simply put it is cheaper to pay the “tax” than offer any insurance coverage to any employee. Shutting down the company’s insurance office and paying the “tax” offers a company a tremendous windfall while pushing all of the responsibility off on to the employees.

There is also the issue of all of the hidden taxes in the bill. We are already seeing taxes being levied on devices that will ultimately be passed onto the consumer. All of those new IRS agents will also be looking to justify their salaries.

A short time ago I was in my dentist office and a young man walked in who wanted an appointment, he had no insurance and no money. Explaining that he would have to pay for service he still wanted an appointment. This person wanted dental service in a nice office, and did not feel the need to pay.

With over 30M new Medicaid patients how will doctors handle the influx of patients wanting service because they now have insurance.

How will we, as the public pay for this new entitlement, along with all of the new patients who are on some type of government backed insurance program? Taxes.

Be careful what you wish for.

Steve Lucas

Harrison said...

It is interesting that Justice Roberts wrote for the majority, when he in fact held an opinion not shared by any other Justice.
I admire him for this though. He found a way to support the legislation, when in fact he probably finds it to be an over reach.

Of course even more interesting is the assertion from Gov. Romney that he will repeal the law on day one.
He will not have that kind of power.


Rich Trachtman said...

In yesterday's ACP Advocate Blog entitled "Good News for Obamacare, But Not 'Full Steam Ahead', Bob Doherty alludes to the fact those states not inclined to partner with the federal government in expanding their Medicaid programs to cover those up to 133 percent of the federal poverty level as prescribed by the ACA suddenly have a lot less to lose. By virtue of the Medicaid portion of yesterday's Supreme Court ruling, such states no longer face the ACA's stiff penalty for non-compliance—-forfeiture of all federal financial support for Medicaid—-including the federal contribution to their existing Medicaid programs.

This Medicaid expansion is an extremely significant element of the ACA's approach to providing near-universal access to health insurance coverage. To bring about this massive coverage expansion, Congress stepped up to the plate when enacting the ACA by providing 100 percent federal funding in the initial phase gradually decreasing to a minimum of 90 percent—at a cost to the federal government of half a trillion dollars.

With the principal sanction for non-compliance now lifted, what will be the effect on health coverage in states that elect not to participate in the ACA Medicaid expansion? Those individuals between 100 percent and 133 percent of the poverty level would be eligible for federal premium assistance credits. However those under 100 percent of poverty and not currently Medicaid eligible would not be so fortunate. Individuals in this population are at risk of finding themselves without access to coverage--in spite of the ACA and, some could argue, because of the Supreme Court decision upholding it.

How will states respond to these new ground rules? In his opinion, Chief Justice Roberts asserts that existing Medicaid programs remain untouched as a consequence of the court's ruling. Roberts states:

"The Court today limits the financial pressure the Secretary may apply to induce States to accept the terms of the Medicaid expansion. As a practical matter, that means States may now choose to reject the expansion; that is the whole point. But that does not mean that all or even any will."

States are entering a period of critical decision-making. Access to health coverage for those uninsured least able to afford it hangs in the balance.

Rich Trachtman

ryanjo said...

I find one of Chief Justice Roberts' comments telling, perhaps prophetic, in regard to the ACA: “It is not our job,” he said, “to protect the people from the consequences of their political choices.”

Well you sure didn't do that, Justice Roberts. Now the people can all watch a replay of the strife and chaos of the past 3 years:
-- more "death panel" and "Alan Grayson" rhetoric
-- more special concessions to friendly unions & businesses
-- more standoffs between the House & Senate over enabling legislation, budgets, funding the new agencies
-- more posturing over how well the ACOs are being received by large corporate physician groups
-- more rationing that pretends to be reducing waste and fraud
-- half the states in rebellion over the Medicaid expansion and insurance exchanges

It would be interesting to watch if this coming conflagration didn't threaten my practice and my patients. It gives me no comfort to be more enmeshed with the big sputtering government.