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August 2013
Health Care Changes: Not Such New Ideas After All!
By John Paul Galles

     Republicans in the U.S. House of Representatives have now voted 40 times to repeal the Affordable Care Act of 2010 (ACA), although they have not yet put forth an alternative. They say they aren’t opposed to the idea of universal health care; they just think that the Obama administration and their allies in Congress went about it the wrong way. They’d repeal the bill and replace it with something better.

      While the passage of time and the strength of their indecision alone probably make this a moot point, it is interesting to note just how much the text of what was once called the Patient’s Choice Act (PCA), assembled in 2009 by Sen. Tom Coburn and Rep. Paul Ryan, the two most influential Congressional Republicans on the issue, conforms in principal to the ACA as enacted.

     Significantly, here’s how the PCA would have worked:

1. States would open health insurance exchanges where individuals and small businesses could buy insurance.

2. Insurance plans on the exchanges would have to provide a base level of coverage set by the federal government.

3. Insurers could not turn down customers because of pre-existing conditions.

4. Individuals and families would get a refundable tax credit to pay for insurance.

5. That tax credit would be funded by a limitation of the tax exemption for employer provided coverage.

     Those provisions accurately describe both the PCA and the ACA. That isn’t a coincidence. According to an analysis by The Washington Post, “The ACA bears a heavy resemblance to basically every real universal healthcare plan that Republican legislators have proposed in the past half century.”

     There are plenty of differences, of course. The ACA expands Medicaid and the PCA restricts Medicaid to low-income disabled people, while the rest are moved to private insurance. The ACA cuts Medicare provider payments and the PCA means-tests premiums. The ACA has mandates; the PCA auto-enrolls people in state exchanges, more of a soft mandate.

     Much of the frustration with the ACA is its interpretation and implementation; the reality is that any law trying to reshape nearly 20 percent of our GDP will not likely be smoothly implemented. Our history demonstrates that implementation takes time and many adjustments; both Medicaid and Medicare have taken many years to implement and each has been adapted frequently since they were adopted in 1965.

     The task is multiplied many times over when the responsible agency, the Department of Health and Human Services (DHHS), must set up the bureaucracy to administer the act and accommodate those states choosing to participate with and create their own health care exchanges.

     Yet while the main portion of the ACA will not go into effect until 2014, the American public has become well aware of the new requirements being applied to all coverage:

1. Elimination of pre-existing conditions—benefits can no longer be denied;

2. End of lifetime limits on coverage;

3. Coverage for young adults on parents insurance up to the age of 26;

4. Plain language benefits information;

5. Covered preventative care for adults, women and children;

6. Coverage for your choice of doctors;

7. Holding insurance plans to be accountable: If they don’t spend at least 80 cents of every premium dollar on actual health care, they must refund the difference.

     Although the DHHS announced the delay in implementing the employer mandate for one year, the individual mandate to obtain health care coverage is still in place. The good news is that in the states with newly-created state-sponsored health exchanges, the proposed rates for individual coverage are uniformly lower than estimated, allowing individuals better coverage at a lesser rate.

John Paul Galles is the publisher of Greater Charlotte Biz.
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