Affordable Fair Act?
By Lang, Ron | |
Proquest LLC |
A Discussion of the Patient Protection and Affordable Care Act
Political slants seem to creep I (TM) J into any discussion* of the Patient Protection and Affordable Care Art (ACA). Further clouding occurs as pundits, politicians irod the media intermix terms, races and opinions. ACA enÜttiH» sight the benefits of providing health coverage to ihe 47 million uninsured and reining in the insurance companies. The government's participation in a huge sector of the economy and disrupting the free iruuket forces are at the core or ACA opponents' argument*.
As of chi* writing, more than 40 changes have been made to the law since it was passed. Mast notably and recently
Factors Behind the Changes
Why the seemingly endless parade of changes and delays in implementing the law? To begin with, the law-at more than 900 pages-is complex and cumbersome, and its content is controversial to say the least. Further, it lays out a framework, in many eases without important detail*. And rather than a single answer, there are many factors contributing to the large number of changes on the fijr
* ihe taw contains ambiguities with many provisions needing the details filled in by ggvçniTRCïït agencies;
* Much of it was developed without industry input on how and Wh&l could be practically implemented, creating provisions that did not have apparent or practical implementation methods, technical limitations on how quickly computer systems could lx: deployed and resources were not available to implement certain provisions.
Examples of the above include the abandoning oí the long-term care and free voucher prognuns, and the delay in the small, business health options program exchange multi-carrier (hopping capability.
As various influential groups started figuring out how certain provisions were gering to affect them, politicians and regulators reacted to their voices. The
Poli Debuts trod regulators did little or nothing to address Lut year's mass individual policy cancellations primarily because the state and federal exchanges saw any kind of delay or accommodation as a threat so their success.
California SB 1446, signed by
Last year, small employers that were facing extraordinary high premium increase* due to ACA's mandate* had an nut. Carriers offered them an Cady renewal, which extended their non-ACA compliant policy for one year. About half the market took the early renewal extension offen The other half moved into ACA compliant plans, typically with moderate premium increases or even dec re ate* under the neu regulation* SB 1446'* one-year bandaid on small-employer policy cancellations and premium increases is controversial. Close who oppose it think it's an election year ploy. Supporters say it's part of the president's promise of "you etui keep your plan," although only through I Jet. 31,2015.
With all these changes, folk, from all sides are crying political foul.
A Question of Fairness
At we're now in the middle of ACA'* longawaited (and delayed) implementation, this may be an appropriate time to ask, "Is the ACA fair?" I don't recall any federal taw that stirred emotions more, or was in the media spotlight longer, than ACA, But very few discussions center on fairness. "Fair" being defined in terms of treating everyone the same, free from bias ami injustice.
There's also a definition of "fair" meaning neither excellent nor poor; or being moderately or tolerably good. Based on the AC I.-Vs implementation history so far, proponents would probably say tolerably good and opponents the opposite.
Through its many somewhat tripolar facets, the ACA has created economic winners and losers. Ptoplc getting access to coverage they could not previously obtain or afford think the law is gtxxi. On the flip side, people and employers that are paying more and incurring more administrative burden arc more likely to think the law unfair or not good for them.
Younger people (under age 26) can be covered under their parent's health plan where pre-ACA plans typically maxed out at 19 or 22 (if they were In school). On the other side, ACA rating mandate* for younger people in the Individual and small-group markets raises rates two to three times above their actuarial value. Younger folks trying to make it u:t their own and parents who have kids in the nest are paying more in premiums under ACA's mandatée
So, while older insureds may think it's good that they aro receiving lower premiums brought about by ACT A premium rules:, younger pexrpfc may think it not fair that they are paying more to subsidize the older end of the age curve,
Millions of people who could nol obtain Inal* «average due » pte-e>raûng«n«liüOitt now have access to coverage-a noble cause nuiu would agree wi*. As a side note, Tor 20plui years 1 have been an advocate for everyone having access ut heal* insurance, but the AGA's permanent elimination of pre-existing condition restrictions perpetuates a problem.
When you eliminate pre-existing restrictions, people who have pre-existing conditions will enroll, which is a good thing. The goal, of course, is to get everyone, including healthy people, to enroll. A preexisting condition moratorium for a specified period of time, one year for example, would promote healthy enrollments better than ACA's initial individual mandate taxes. Otherwise, people tend U> wail until they have a medical condition to seek coverage, Permanent elimination of pre-existing condition restrictions allows this behavior to continue rallier than eliminating itHealthy
ramilles--who have scraped togt*cr money to keep *eir coverage in force, providing them protection in *c event of a medial emergency-may not think it's fair that that those who did Hot buy coverage *'when they didn't need It" arc now getting their claims paid at die expense of others.
Many people were satisfied wi* their plans prior to jan. 1,2014.1 ray "tañficd" and not "happy with their hralth plan" because people or employers tend not to be overjoyed about payings significant amount of money lor the privilege of getting to navigate a complex system of medical delivery and insurance. But millions of those satisfied were forced through plan cancellations and new mandated benefits to move to more expensive AGA compliant plans.
Those who were satisfied with their plan think it's not fair they bad to buy benefits or benefit levels they do not want or need. Frdiatrie dental and maternity benefiu were two mandóte» prominently in the news its men, non-child-bearing-agcd women and others wondered wiry benefit* they «mid not use were being included in their potidcs, For
Even wilhtn general ACA categories, the changes thaï have been made to the law are treating people and employers differently: And many who advocate for on-schcdulc ACA imphiineriijiiiori ire thri its unfair, or rewarding *osc who found loopholes to not comply wi* dir original law
For example, SB 14-10 extends nonecunpliani plan provisions, but not for everyone. If your small group had a July I, 2014, renewal date, or any date between January and July, you were forced into au ACA complaint plan while *osc w ho chose to early renew last year are getting an additional year of non-compliance, for the non-compliers, Lhis actually equates to gening two years of preferential treatment from December 201S to
The heal* insurance market was flawed. The ACA aimed to establish a somewhat fair and level playing field: everyone has coverage. Oll cOwauge meets minimum requirement*, no one pays more than 9.5 percent of *cít income in premiums, etcTo date, the ACA has enrolled about Ibpercentof *e uninsured population, leaving about 40 million not complying with the law: The change from the prior state to *e future state creates disruption, and economic winners and losers. The winners lend to th ink it is fair and *e losers not. S!
Copyright: | (c) 2014 California Society of Certified Public Accountants |
Wordcount: | 1501 |
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