The Affordable Care Act is the most comprehensive reform of the United States health system since Medicare was established in 1965 under President Lyndon Johnson. The US is way behind other developed nations in providing universal health care coverage and our health care system is notable for its inequities and inefficiencies. The ACA is only a small step toward improving this and changes and challenges in its implementation have weakened this effort. At the same time, there are innovations in the law to increase quality and cost control that, if successful, can perhaps inform the efforts of other countries struggling to maintain coverage in the midst of economic downturns. A just published article by John McDonough (Harvard School of Public Health) in a new journal called Health Systems & Reform does a nice job of laying out the basics of the ACA to date.
The ACA includes 10 Titles covering access, quality, and cost control. (You can read the full law here if you are so inclined.) Efforts to improve access through health insurance exchanges and other provisions have been most publicized. But provisions aimed at improving quality and cost control are less talked about. They are, however, extremely important because health care spending in the US has increased way beyond that of other developed nations over the last thirty years, but our outcomes are not comparably very good. In short, other countries are doing better in providing quality health care to a larger proportion of their citizens with less money.
To address this, the ACA moves health care financing away from fee-for-service to a system that rewards providers for improvements in quality, efficiency, and outcomes. This includes incentives for improving care collaboration across providers and penalties for hospitals with high rates of 30-day readmission and hospital-acquired infections. Other cost control efforts reform or create structures to prevent fraud and abuse, emphasize health promotion and disease prevention, and reform practices in the development and testing of drugs and medical supplies.
It will, of course, take time to fully understand the impact of the law, but McDonough cites preliminary data from a variety of sources. For example:
- According to the Commonwealth Fund an estimated 20 million Americans obtained coverage under the ACA as of May 1, 2014.
- Gallup surveys indicate that the rates of adults 18 and older who are uninsured dropped from 17.1% in the fall of 2013 to 13.4% in April of 2014. The drop in uninsured was higher for African Americans, Latinos, and people who are lower-income.
- Excluding older adults, the rates of uninsured dropped from 21% in Sept 2013 to 16.3% by April 2014 (a decline of 10.3 million people) (from Harvard School of Public Health and the U.S. Dept. of Health & Human Services).
- On the not so positive side, the Urban Institute has noted a growing disparity between states that are expanding Medicaid vs. those that are not. In Sept 2013, 49.7% of uninsured adults lived in states not expanding Medicaid. This increased to 60.6% by June 2014.
- Hospital induced conditions such as adverse drug events, infections, or falls decreased nationally by 9% and Medicare 30-day readmission rates decreased by 8% (from 2011-2012 data from the US Dept. of Health & Human Services).
- Prices of health care goods and services and per enrollee spending on both private and public health coverage have been rising at historically low rates (from Bureau of Economic Analysis). At this point, it’s difficult to tell to what extent this is a direct or indirect effect of the ACA, but the law has not drastically increased health spending as some predicted.
And, the debate, rages on in Congress, the Supreme Court, in the presidential elections to come, and over family dinner tables. As McDonough notes, health reform in the U.S. has always been politically divisive, but the level of politicization around the ACA has been particularly intense. The Kaiser Family Foundation has extensive resources on all things health reform including this interactive tracking poll looking at public opinions of the ACA from the summer of 2011 to January 2015. With some blips along the way, respondents have been roughly evenly split in terms of reporting whether they are favorable or unfavorable to the law. But not surprising, the picture changes dramatically when you look at Democrats vs. Republicans with the majority of Democrats favorable and the majority of Republicans unfavorable. Interestingly, the results are not so clear cut when respondents are asked about specific portions of the ACA.
The other important point McDonough raises is about how complex the U.S. health care system is and the influence of past policy decisions on creating that complexity and constraining decisions moving forward. He gives the example of Medicare which began with Part A (for hospital services), then added Part B (for physician services), Part C (which allowed private insurers to participate) and Part D (for prescription drug coverage). Each adds a layer of complexity that, I would argue, a truly comprehensive health care reform should be able to address. But, alas, that’s not the way our political system works.
It will be interesting to see how implementation of the ACA continues to unfold moving forward.
Hi Amanda, I’m still working at the Otsego County Commission on Aging. I have dipped myself into the ACA by becoming a CAC to help enroll clients into ACA plans. Last year I saw a lot of help for clients, in particular for low income folks. This year however, I noticed that in Michigan anyway, there are more plans, but the prices seem to be higher, especially for the middle class, who wind up looking at very high premiums and fewer options for lower deductibles. The insurance companies last year had to compete more because they were afraid of missing the ACA boat, so to speak. This year they seem to have figured out once again that via a form of collusion, much like the gas station industry, raise the prices and keep them fairly even, and the customer just has to pay the going rate. There are still savings for the very low income folks, which was necessary and good. But for folks who are middle income earners, it’s a different story. Yes, there are still silver plans with lower deductibles, but you have to be able to afford the higher premiums. If you do not qualify for a subsidy, or have a low subsidy, you are hurting. I still believe that the ACA was needed. Something had to be done because I was watching health care costs rise and rise under the old system to the point where only the wealthy would be able to afford health care. ACA still needs to improve. I hope the points you mentioned above will help to tweak the ACA in the right direction. Health care is a basic human right. Thanks for writing your piece. I enjoyed reading it. Take care, John.
Hi John – It’s great to hear from you. Thank you for your insights as someone who is working closely with the ACA. Clearly there is still a lot of work to do. Unlike other countries that offer universal coverage, health care here remains a market-driven system. It will be interesting (to say the least) to see what happens moving forward.