Thursday, August 30, 2012

What Caught My Eye Today - Barack Obama's plan for healthcare

Fred's Note: It occurs to me that in recent posts regarding the upcoming U.S. Presidential election that I am guilty of doing the same thing as various media outlets by rendering opinions on statements that I may have taken out of context. To be fair, I'm not a professional journalist and doubt very much that my blog will ever reach the critical mass that the New York Times does. However, the information is readily available to anyone who truly wants to make an informed decision come Election Day in November. With that in mind, over the next several days and weeks, I'll be posting excerpts from the websites of both the Republican presidential candidate, Mitt Romney and the incumbent Democratic candidate, Barack Obama. It goes without saying that I will be adding some color commentary, but the content is from the candidates themselves.


Fourth in our series, Barack Obama's plan for health care. Due to the fact that most of Obama's plan for health care has already been enacted as part of the Health Care and Education Reconciliation Act of 2010, we start first with a listing of specific provisions contained within the legislation followed Obama's stance on health care.

The Patient Protection and Affordable Care Act (PPACA), together with the Health Care and Education Reconciliation Act, represents the most significant regulatory overhaul of the U.S. health care system since the passage of Medicare and Medicaid in 1965. PPACA includes numerous provisions to take effect over several years beginning in 2010.
  • Guaranteed issue will require policies to be issued regardless of any medical condition, and partial community rating will require insurers to offer the same premium to all applicants of the same age and geographical location without regard to gender or most pre-existing conditions.
  • A shared responsibility requirement, commonly called an individual mandate, requires that all individuals not covered by an employer sponsored health plan, Medicaid, Medicare or other public insurance programs, purchase and comply with an approved private insurance policy or pay a penalty, unless the applicable individual is a member of a recognized religious sect exempted by the Internal Revenue Service, or waived in cases of financial hardship.
  • Health insurance exchanges will commence operation in each state, offering a marketplace where individuals and small businesses can compare policies and premiums, and buy insurance.
  • Low income individuals and families above 100% and up to 400% of the federal poverty level will receive federal subsidies on a sliding scale if they choose to purchase insurance via an exchange.
  • The text of the law expands Medicaid eligibility to include all individuals and families with incomes up to 133% of the poverty level, and simplifies the CHIP enrollment process. In National Federation of Independent Business v. Sebelius, the Supreme Court effectively allowed states to opt out of the Medicaid expansion, and some states have stated their intention to do so.
  • Minimum standards for health insurance policies are to be established and annual and lifetime coverage caps will be banned.
  • Firms employing 50 or more people but not offering health insurance will also pay a shared responsibility requirement if the government has had to subsidize an employee's health care.
  • Very small businesses will be able to get subsidies if they purchase insurance through an exchange.
  • Co-payments, co-insurance, and deductibles are to be eliminated for select health care insurance benefits considered to be part of an "essential benefits package" for Level A or Level B preventive care.
  • Changes are enacted that allow a restructuring of Medicare reimbursement from "fee-for-service" to "bundled payments."
And now, the President's take on arguably his greatest legislative accomplishment of his first term in office.

President Obama passed the Affordable Care Act to restore health care as a basic cornerstone of middle-class security in America. The Affordable Care Act will make health care more affordable for families and small businesses and brings much-needed transparency to the insurance industry. When fully implemented, the Affordable Care Act will keep insurance companies from taking advantage of consumers—including denying coverage to people with pre-existing conditions and cancelling coverage when someone gets sick. The key phrase is "when fully implemented". A bunch of big ticket items aren't scheduled to take effect until 2014 and some won't see the light of day until 2020, four years after Obama leaves office (assuming he wins a second term in November). Among the benefits of the Affordable Care Act:
  • 34 million more Americans will gain coverage—many who will be able to afford insurance for the first time. The irony here is that will the law suffers from a lack of popularity (56% of Americans don't like it), everyone likes the fact that more citizens will have health care...due entirely to the law that they don't like.
  • About 95% of Americans under age 65 will have insurance. I guess the thing Obama didn't consider was whether or not Americans actually wanted to have health insurance. As it turns out, most healthy people (those that have no immediate need of health care) don't like the fact that the government is forcing health insurance on them, while those in need of health care really like the fact that they have health insurance to help them manage costs.
  • The law will slow health care premium growth rates, adding another $2,000 to family savings by 2019. According to analysis the Congressional Budget Office conducted in 2009, close to 80 percent of the population should see a reduction in premiums ranging from 0% up to 40% (in extreme cases), which the remaining 20% will see an increase in premiums up to 13%. So I guess, this statement is mostly accurate (at least 80% of it).
  • As many as 17 million children with pre-existing conditions can no longer be denied health insurance.
  • Nearly 3.6 million seniors who fell into the Medicare “doughnut hole” last year saved an average of $604 on prescription drugs. This is that extreme case I mentioned earlier.
  • The law is expected to reduce the deficit by $127 billion from 2012 to 2021. Truth be told, actual savings is anyone's guess. Prior to the Supreme Court ruling allowing states to opt out of Medicare, the CBO pegged savings at close to $210 billion; after the ruling the new savings estimate came in at $87 billion.  And given the fact that the federal debt stands at roughly $16 trillion, I'm not sure a few billion dollars here or there is gong to matter much.
You can read up on Barack Obama's position on the healthcare here. Next time, Mitt Romney's energy plan.

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