Tag Archives: health insurance

Is it Possible to Insure Everyone in a For-Profit Health Insurance Market?

Posted on by
Reply

By Bikna Huang

Over the past two days, we have been examining the Affordable Care Act in light of the impending Supreme Court decision on the individual mandate provision.  Overall, the issue at hand is how to maintain a for-profit private health insurance system while requiring insurers to essentially return to the community rating system that they had basically abandoned by the 1960s. Earlier this month, President Obama stressed that there were only two ways to fix the health care system, by implementing the individual mandate or a single payer system. The single payer system would be another solution presented by President Obama and the Democrats.

“One way is a single payer plan. Everybody is under a single system like Medicare. The other way is to set up the system in which you don’t have people who are healthy but don’t bother to get health insurance and then we all have to pay for them in the emergency room. That doesn’t work, and so as a consequence we’ve got to make sure that those folks are taking the responsibility seriously – which is what the individual mandate does.” – President Obama

Another solution is Representative Paul Ryan’s plan.  Ryan’s proposal, transforms Medicare and creates a premium support plan. This plan will essentially give premium support for senior citizens to choose from varies providers for their Medicare coverage. The goal of this plan is to reform the Medicare system and “to create—a market so robust we can finally begin to control costs.” Under Ryan’s plan, those who do not purchase health insurance will not be penalized.

We have looked at different aspects of Obamacare through this series, focusing primarily on the individual manadate.  However, in the broader context, the fate of the individual mandate is simply one piece of a problem that needs to be addressed. The United States is ranked as one of the top nations in the world in terms of its GDP and standards of living; however, this is surprising when the health care system in the United States is ranked thirty-seven. When President Obama took office in 2008, the prospect of health care reform seemed closer than ever and the compromise plan that emerged, the Affordable Care Act, seemed like the solution. But in order to maintain the private system, the individual mandate, proposed in the 1980s by the Heritage Foundation seemed to be the most practical way.  There is much to be known about the Affordable Care Act, and the constitutionality of the act is still being decided. What do you think about the individual mandate? Will Obamacare be a push in the right direction for health care reform?

Bikna Huang is an intern with TheFactFile.com who studies at CalPoly in San Luis Obispo, California.

Could the Affordable Care Act survive if the individual mandate Were Eliminated?

Posted on by
Reply

By Bikna Huang

In March 2012, the United States Supreme Court heard oral arguments about the Affordable Care Act, popularly known as “Obamacare.”  Most of the argument was about the individual mandate provision,  which bothered the states who had brought the original individual law suits that were heard together before the Supreme Court.  Once fully implemented in 2014, the individual mandate requires the 50 million uninsured Americans to obtain health insurance.

The idea behind the mandate is to bring costs down for everyone by bringing generally younger and healthier Americans who would not normally buy health insurance into the market which has the effect of spreading the costs for expensive care over a larger population and thereby reduces the average costs for everyone and thereby lowers premiums.  A secondary argument is that it keeps the uninsured out of emergency rooms which is generally where the uninsured get their care.  The reason this is important is that emergency room treatment is extremely expensive compared to normal medical care.  Thus, the mandate was added as a method to require Americans who are generally healthy to buy insurance they would not otherwise buy. There are some studies to support the notion that the mandate is important to cost containment.  For example, a study published in the journal Health Affairs noted:

“We estimate that if the mandate were lifted, premiums in the individual market would increase by 12.6 percent—somewhat less than other estimates—with 7.8 million people losing coverage, versus other estimates for coverage loss of 16–24 million people. In sum, the Affordable Care Act would still cover 23 million people who would have been uninsured without the law.”

While cost containment is the reason for the inclusion of the individual mandate, we wondered whether The Affordable Care act could survive if the Supreme Court strikes down that provision.  That is, without the individual mandate, is Obamacare still Obamacare?  There are a number of possibilities, however, removing the individual mandate would remove the central feature of the plan—premium cost containment.  If the Supreme Court strikes down the individual mandate, Congress can either  fix or abandon the bill by transforming the mandate into a tax (or tax rebate) that is clearly within Congressional power. The Court could also simply order that the references to the individual mandate be stricken, that would leave the rest of the act in place.  In that case, the most popular provisions of the ACA would remain, people with pre-existing conditions would have guaranteed insurability, low income people would receive subsidies for health insurance. Of course, the individual mandate itself is a way to provide revenue for the insurance companies in exchange for insuring everyone without regard to risk (pre-existing conditions) so in the most dismal outcome, striking the individual mandate could lead insurance companies to bankruptcy.

Bikna Huang is an intern with TheFactFile.com who studies at CalPoly in San Luis Obispo, California.

The Affordable Care Act Celebrates its Second Birthday at The Supreme Court

Posted on by
2

Last week, the Affordable Care Act (ACA) celebrated its second anniversary, and today, the Supreme Court will take up arguments brought by states questioning whether the Federal Government has the right to require individuals to purchase health insurance policies.  The key issue is whether this mandate is justified by the Commerce Clause of the Constitution, as the Administration argues.

Ironically, the individual mandate itself is an idea that stems from a 1989 report from the conservative Heritage Foundation.  In that report, Stuart Butler (Heritage’s health care expert at the time) argued that under the “Heritage Plan” a mandate was necessary because “[s]ociety does feel a moral obligation to insure that its citizens do not suffer from the unavailability of health care. But on the other hand, each household has the obligation, to the extent it is able, to avoid placing demands on society by protecting itself… A mandate on households certainly would force those with adequate means to obtain insurance protection.”  This was, of course, a central element of Mitt Romney’s Massachusetts plan as well as his 2008 defense of this plan; in the 2008 ABC News debate, Governor Romney stated, “Here’s my view: If somebody – if somebody can afford insurance and decides not to buy it, and then they get sick, they ought to pay their own way, as opposed to expect the government to pay their way….And that’s an American principle. That’s a principle of personal responsibility.”

To assist with the complexity of this issue, we have posted a series of videos below from the Alliance for Health Care Reform.  The Alliance for Health Care Reform, is a nonpartisan, nonprofit group, that according to its mission statement, “does not lobby or take positions on legislation.”  In their statement accompanying the release of the videos to coincide with the second anniversary of the Affordable Care Act, the Alliance for Health Care Reform wrote something near and dear to TheFactFile.com (emphasis added), “Although the Affordable Care Act is two years old today, it’s obvious that millions of Americans don’t understand it. This is a bipartisan problem. So, believing that people should argue about policy but not facts, [The Alliance for Health Care Reform created] videos to help…explain…how the law affects” young adults, small employers, people on Medicare or Medicaid, uninsured with pre-existing conditions and primary care providers.  TheFactFile.com found these videos extremely informative and we hope our readers will as well.

YOUNG ADULTS (3:01)
featuring Sara Collins, vice president for the Affordable Health Insurance Program at The Commonwealth Fund

SMALL EMPLOYERS (3:40)
 featuring Terry Gardiner, vice president for policy and strategy at Small Business Majority

PEOPLE ON MEDICARE (3:04)
 featuring John Rother, president of the National Coalition on Health Care

PEOPLE ON MEDICAID (2:44)
 
featuring Diane Rowland, executive vice president of the Kaiser Family Foundation

UNINSURED PEOPLE WITH PRE-EXISTING CONDITIONS (2:44)
 
featuring Deborah Chollet, senior fellow at Mathematica Policy Research

PRIMARY CARE PROVIDERS (3:02) featuring Kevin Grumbach, MD, professor and chair of the Dept. of Family and Community Medicine at the Univ. of California, San Francisco