The Affordable HealthCare Act (ACA)

Part 4 of a 7-part series
The good news and bad news of health reform for 20 key groups (groups 15-20)

Show me the money! Let’s face it; forecast revenue plays a major role when business professionals use their business plans to try and convince investors to jump on board with their vision. Likewise, financial projections are exactly what health reform used in its push to acceptance. The Congressional Budget Office’s (CBO) original forecast covering 2010 through 2019 showed a cost of $1,075 billion and generated revenue totaling $1,218 billion. That leaves an access $143 billion to be applied to the nation’s deficit. Not bad, huh? The big question is, how accurate are those figures?
      
Forecasts are just that; forecasts. No one can predict what will actually happen in the future. Sometimes the outcome is good; sometimes it’s bad. Medicaid is a good example where forecast and history show a wide variance—like 700+ percent wide. At its inception in 1965, the House Ways and Means Committee forecast that Medicaid would cost the American people $9 billion by 1990, when in actuality it cost $67 billion!

Regardless of what ACA’s history will show us years from now, we need to look at its impact today to determine what this law has in store for our individual households. To help you do that, I’ve been highlighting 20 key groups affected by health reform. Two previous articles covered the good news and bad news of the first 14 groups. Now let’s look at the good and bad of ACA for the last six of them…

For unions

The good news is:

·         since June 2011, the government has granted non-compliance waivers to businesses, delaying the possibility of higher medical costs to them. Labor unions representing 543,812 workers received those waivers, while the small private business owners who received them represented only 69,813 workers.[i]

The bad news is:

·         union workers have been strong supporters of health reform from the beginning. However, several things are turning sour for them and they are demanding answers from the White House on matters such as:

1. extending the statutorily mandated deadline until December 31, 2013, which benefits the employer at the expense of the employee.
2. ACA creates an incentive for employers to keep worker’s hours below 30 hours a week to avoid offering health care benefits. This now leaves some employees with less work hours and no health care coverage.
3. non-profit health insurance plans, jointly governed by unions and companies under the Taft-Harley act, have been used by union workers for decades. These plans now offer less subsidies to union workers than to other citizens.

For physicians and other health professionals

The good news is:

·         30 million more potential patients will no doubt benefit physicians and will equate to job security for nurses, hospital workers and various positions associated with health insurance providers.

The bad news is:

·         all the changes and complexities of this new law are difficult for doctors’ offices and health practices to convert to, especially in the midst of physician shortages, which had already been occurring prior to ACA.

·         since the elimination of physician’s fee-for-service payment method (the most expensive type of health care insurance), and since new restraints have been placed on payment rates with Medicare, many physicians are fearing financial ruin for their practices. 

For patients

The good news is:

·         for high-risk patients, insurers will not be able to reject them nor charge them higher premiums                                                                                                                                     

·         for patients of nursing homes, ACA will require nursing home ownership to be more transparent in their operations. That will entail states monitoring these homes a lot closer to uncover and eliminate fraud and abuse; thereby, increasing the quality of “life” in a hospital or nursing home.

·         for Medicaid patients, who for many years have been passed up by doctors due to that program’s low payment rate to doctors and hospitals, the playing field is leveled.                                                                       

The bad news is:

·         the expenses associated with not charging higher premiums to high-risk patients will be passed on to those in the low-risk pool. In other words, the unhealthy couch potato will not pay more for his coverage than the health nut who exercises daily.

·         with over 30 million additional people with health insurance benefits, it the quality of care that patients receive will suffer since the number of health care professionals are not increasing proportionately

For nursing homes

The good news is:

·         a decrease of $716 billion for Medicare will cause hospitals to downsize staffs and make salary cuts. This does allow senior citizens in hospitals and nursing homes to have the same benefits with lower costs and deductibles. However, there will not be enough staff to attend to the sick and ill, which in the end will fuel the two main causes of incidents in nursing homes right now — the transferring of patients to different facilitations, as well as abuse and neglect.

The bad news is:

·         these same lowered costs and deductibles to be enjoyed by the elderly will cause nursing homes to be understaffed due to budget and salary cuts.

·         understaffing can perpetuate the problem that so many nursing homes had already been battling: the ability to safely transport patients and the neglect and abuse.  

For insurance companies

The good news is:

·         needless to say, there is a lot of good news in store for any industry that can welcome 30 million new customers into their database.

·         many of these new customers will come to the insurance companies with government monies to spend for their health insurance purchase

·         the insurance companies will be able to pass along their increased costs in the form of higher premiums, co-pays and deductions.

The bad news is:

·         to help generate the CBO’s forecasted billions to help decrease the deficit, there will be significant new annual fees imposed upon health insurance companies. These fees will be phased in over a period of five years.

For pharmaceutical companies

The good news is:

·         for generic pharmaceutical companies, their percentage of all prescriptions in the US will ultimately increase upwards from its current 70%, because health reform programs will seek out the lower priced generics.

·         even though this sector will be hit with challenges and new fees, it will remain a relatively safe industry for investors because consumers use medicines regardless of economic conditions. 

The bad news is:

·         to help generate about 9% of the the CBO’s forecasted billions that health reform will generate, there will be significant new annual fees imposed upon the pharmaceutical industry.

So there you have it; the good news/bad news of ACA for twenty key groups. Next time, we’ll cover issues like the closing of the donut hole; the CLASS program and public option. See you then!