1. Individuals suffering from pre-existing conditions will no longer be denied insurance. The law prevents individual health insurers from excluding children with pre-existing conditions from being covered by their family policy. Insurers will not be required to take the same steps for adults until January 1, 2014. In the mean time, Obama’s health care law provides coverage for individuals with pre-existing conditions through a temporary national high-risk pool. This plan called the Pre-Existing Condition Insurance Plan (PCIP) will cost taxpayers $5 billion and will end in 2014. When the “Affordable Care Act” is launched in 2014, citizens who suffer from pre-existing conditions cannot be denied coverage, be charged higher premiums, subjected to longer waiting periods, or have benefits reduced by insurance companies.
2. The bill means deep cuts to the federal health care program for the elderly. Medicare, the federal health care program for the elderly will see budget cuts of $40 billion per year, which is nearly 10 percent of the program’s annual budget. The federal benchmark payment to Medicare Advantage plans for seniors will be reduced over several years. Although the law does not make dramatic changes to traditional Medicare, members who are a part of private Medicare HMO’s may have to change plans due to those changes. However, Medicare will also begin to pick up the tab for annual wellness check-ups and pharmaceutical manufacturers must provide a 50 percent discount on brand name prescriptions filled under Part D coverage.
3. The bill will motivate employers to offer better coverage. The law will impose an employer mandate that requires businesses to offer an acceptable level of health insurance coverage or be slapped with a penalty. The penalty amounts to $2,000 for each full-time employee for businesses with more than 50 employees that do not offer coverage.
4. Obamacare forces individuals to buy coverage or face a “penalty.” With Obamacare, in the beginning of 2014, most residents of the United States will be required to obtain health insurance or else face a financial penalty for being uninsured. The penalty will amount to $95 or 1.0 percent of individuals’ income and will then rise to $325 or 2.0 percent of an individual’s income in 2015. In 2016, the penalty will amount to $695 or 2.5 percent of individuals’ income. Families will pay half the amount for children and up to $2,250 per family. Ouch.
5. The implementation of health insurance exchanges. Exchanges are new organizations that will be set up to create a more organized and competitive market for buying health insurance. They will offer options for various health plans, certifying plans that participate and providing information to help consumers better understand their options. Starting in 2014, exchanges will primarily serve individuals buying insurance on their own and small businesses with up to 100 employees, although states may opt to include larger employers in the future.
Source: Center for Health Policy, Heritage Foundation & The Congressional Budget Office (CBO)
The debate over universal health care continues to heat up on a national level.
While there are both positive and negative aspects to this model of health care reform, the question remains whether health insurance coverage should be a basic right or a privilege for American citizens. Here’s a primer on what to expect in the event universal health care became a reality in the U.S.
Where are we now?
The Patient Protection and Affordable Care Act (PPACA) was the first step toward health care reform in the U.S. Signed into law by President Barack Obama on March 23, 2010, followed by the amended version of the act, the Health Care and Education Reconciliation Act of 2010 on March 30, 2010. There are questions being posed over whether the provisions of the law are constitutional.
One of the primary reasons citizens are calling for universal health care is because everyone would have access to health care without breaking the bank every time they needed to see the doctor. Kevin Flynn, president of HealthCare Advocates, Inc., and a former Canadian resident, says this is alarming since 52 percent of bankruptcies in the U.S. are in part due to medical bills.
Single-payer system explained
The universal health care model in Canada is a single-payer system that is government run. In other words, the government pays for care in the private sector and doctors are paid on a fee-for-service basis, which is pooled from government funds. This is very different from socialized medicine because the government does not manage services provided by a health care provider. The doctors do not work for the government, but the government pays for the services they provide to patients.
Some Americans are skeptical about the government’s ability to budget the federal deficit, let alone health care, but there are a number of advantages and disadvantages that come with a single-payer system.
The U.S. Census Bureau reported 46.3 million people were uninsured in 2009. Having universal health care under a single-payer system would mean better preventative care since people would not skimp out on scheduling routine physicals and exams that would normally cost hundreds of dollars.
The U.S. Department of Health and Human Services survey reported in 2009 that one-fifth of the 120 million emergency room visits in 2006 consisted of people who did not have health insurance. While a recent report released by the Centers for Disease Control and Prevention in May 2010, found that older adults over the age of 75, non-Hispanic black individuals, poor people and those with Medicaid coverage were more likely to have visited an emergency department in the last 12 months than those who are younger, of a different ethnicity, at higher income levels and enrolled in a health insurance plan. However, the CDC study also found that the uninsured were more likely to visit the emergency department more than once in a year’s time than people with private health coverage.
Experts argue that patients who visit the ER who are in dire need of care drive up health care costs as a whole, because often those patients cannot afford to pay the high cost of emergency care without insurance. In many cases, this results in patients filing bankruptcy and the hospital eating the bill.
Others note that patients who have health insurance are more likely to take part in preventative care, reducing the number of costly ER visits and treatment for critical medical conditions.
Pre-existing medical conditions
Also, pre-existing medical conditions such a diabetes would be caught early or prevented entirely if patients were at risk for developing certain life-threatening illnesses. Communication among health care providers will also improve due to adopting a unified records management system under the government, rather than our current fragmented one, says Flynn.
The cost of care would be reduced as well due to administration fees being slashed and the placement of caps on medical costs such as pharmaceuticals.
“They [Canadians] put caps on health care costs to keep health care affordable which includes keeping pharmaceuticals affordable. Pharmaceutical costs here run wild,” says Flynn.
“These additional “administration fees” concern the profits of insurance companies and insurance brokers’ because insurance brokers take 3 to 5 percent of the premiums toward these fees and insurance companies take 11 percent,” says Flynn.
A government run health care system eliminates nearly all insurance companies and brokers since the government would then reign over health care coverage with the exception of a small sector of private health care providers.
Who pays?
Although the cost of health care will be reduced and everyone would potentially have health care coverage, there is still a misconception that universal health care is free. Sure, the bill is sent to the government post doctor’s visit; however you will notice that your paycheck is significantly smaller due to the increase in income taxes.
“In Canada, the rule is this: you get half your paycheck because while people think care is free in Canada, you’re still paying for it. You’re just paying for it in the way of wage taxes. Canadians only get one half of their annual paycheck and all the rest goes into taxes which is covering the health care system,” says Flynn.
Access to health care and the quality of health care will also suffer under a universal health care plan. The wait for services will be extended, and Flynn says and your illness will become more severe than when you first walked into the waiting room. Flynn recounted a time when he was in the waiting room for 24 hours until he just left without receiving care.
“Here’s the trick in Canada, if you go to the emergency room, you have to say something to the effect of ‘I can’t breathe’ or it has to be cardiac for you to skip the line,” says Flynn.
Quality care
According to the National Center for Policy Analysis (NCPA), Canadian and British patients wait about twice as long- and sometimes more than a year- to see a specialist either to have surgery or receive treatments such as radiation for cancer.
“People frequently think universal care means better care. What universal care provides is ‘coverage’ for all citizens; the ‘care’ component is a separate matter and is dependant on the skills of the provider, not the efficiencies offered via a single- [payer] system, says Flynn.”
Care would also be compromised and would be subject to government rationing. The current health care system in the United States allows people to bounce around to various health insurance companies to obtain the care they need for various procedures. With a single entity controlling health care, certain experimental drugs or procedures may not be covered unless the government allows it.
“Americans don’t want a government run system, says Robert Zirkelbach, spokesperson for America’s Health Insurance Plans. “That means a reduction in care, access and longer waits in the waiting rooms.”
Zirkelbach says that it’s very possible the United States will take the private approach to health care reform, rather than initiating a government-run, single-payer system like Canada.
“The lobbyists are also too strong in order for a single-payer system to be adopted in the United States,” adds Flynn. “Health insurance companies, doctors and lawyers will sooner chase Obama down with pitchforks.”
“Most people think we live in a republic, we don’t. We live in a special interest society,” says Flynn.
