What the health care act may mean for you [The Hutchinson News, Kan.]

July 08--Kira Gorgas acknowledges that she doesn't care much for President Barack Obama and doesn't know much about the health care reform law that has become a political battlefield in the upcoming presidential election.

But Gorgas could stand to benefit greatly from the signature program of his presidency -- the Affordable Care Act, otherwise known as Obamacare.

Gorgas is one of the 351,000 Kansans who don't have any medical insurance. Her employer, a fast food restaurant, offers an insurance policy to its employees, but at her wage of $7.50 an hour and about 35 hours of work a week, the premiums are too expensive.

She also suffers from seizures that disturb her sleep and leave her exhausted when she gets up in the morning, seizures that also might make it prohibitively expensive to buy other insurance in the individual market.

At her current income, Gorgas could be eligible for free Medicaid insurance under the Affordable Care Act if Kansas opts to participate in a Medicaid expansion that would extend coverage to all adults earning less than 133 percent of the Federal Poverty Level. Including her husband's income from his job at another fast food restaurant, as a couple they would be eligible to purchase insurance through the national insurance exchange, with the federal government subsidizing part of the premiums.

That insurance would cost about $123 a month for Kira and her husband, with the government paying $383 a month, according to the Kaiser Family Foundation's health reform subsidy calculator. That's far less than the $230 a month her employer's insurance would cost for her alone.

"That would be really good if I could get some insurance," Gorgas said. "I have seizures and other health problems, and I just don't have the money to pay for insurance. And going to a neurologist would cost me a pretty penny."

Whether any of those new options for Gorgas develops, however, is fraught with uncertainty, despite the U.S. Supreme Court ruling upholding the law 10 days ago. Republicans have made overturning the law one of the major planks in their campaign to defeat Obama in the presidential election.

Gov. Sam Brownback has returned a $31.5 million federal grant to help the state create a state health insurance exchange where people could shop for plans under the law and has said he wants to see what happens in the election before making any decisions on implementing the law, whose major provisions are scheduled to take effect in January 2014.

Sally Tesluk, CEO of the Prairie Star Health Center, the low-cost health center where Gorgas pays $72 per visit when she needs to see a doctor, thinks Prairie Star would get additional patients, but how many is uncertain because many without insurance, like Gorgas, already come to the center when they need to see a doctor. However, she does expect they would come more often if they were covered by <org>Medicaid.

"We know people wait until the last minute to get care because they have so many other bills, and health care is the last thing on their list," Tesluk said.

But, she added, people are only beginning to learn what the Affordable Care Act can provide. The law was over 2,000 pages, and Tesluk said that, like nearly everyone else, she hasn't read the whole thing.

Kevin Miller, president and CEO of Hutchinson Regional Medical Center, said he too has a lot of questions about the law. In the 2,000 pages, he said, are 1,000 references to questions that will be answered or regulations issued later by the secretary of the U.S. Department of Health and Human Services.

Decisions facing Kansas

Kansas Insurance Commissioner Sandy Praeger, who has been alone among Kansas Republican leaders in urging that the state begin planning to implement the law, said that because Brownback returned the planning grant, the state has ceded its right to develop its own health insurance exchange back to the federal government, and it's too late to reverse that decision.

However, she said, Kansas could regain some voice in the process by entering into a partnership with the federal government on the national health insurance exchange. But the state has to send a declaration by Nov. 16 if it wants a chance at that.

The state would then have until Jan. 13 to demonstrate that it has a good planning process and support for enabling legislation for the partnership. Then the federal government would decide whether to certify that Kansas could be ready by January 2014.

The other major decision Kansas must make, she said, is whether to go along with the expansion of Medicaid to cover those who make up to 133 percent of federal poverty level, or about $15,400 for an individual and $20,600 for a family of four. That would provide free health insurance to an estimated 151,000 Kansans, or about 43 percent of the state's uninsured.

In the first three years of Medicaid expansion, the federal government would pay 100 percent of the cost. The federal contribution would decline to 90 percent by the year 2020, with the state picking up the remaining 10 percent.

Praeger acknowledged the lingering uncertainty about whether the November election could lead to repealing the Affordable Care Act, but she said health care is "a basic human right."

"I can't imagine that we could be so unaffected by the human element of this that it would be overturned," she said. "It's not perfect. But it's long overdue and it's built on what we already have."

An end to uncompensated care?

Tom Bell, president and CEO of the Kansas Hospital Association, said there are things his members don't like about the law but they also aren't looking forward to going through another lengthy debate over health care next year.

"Most people will say there are some good things in the law and maybe some things we don't like so well. They would like to focus on whether there are things we can salvage and move forward. The bottom line is I'm not sure, because of our political climate, that we have any more certainty for hospitals or physicians or other health care providers than we had (before the Supreme Court ruling). So it's hard to plan for what we're going to do next year."

Miller agreed.

"If we go down that path (toward repeal), and the stars and moons line up, my hope and I think hope of most hospitals would be there are pieces and parts of the Affordable Care Act that make sense and that we should keep," Miller said. "All health care professionals recognize we need to fix our broken system. But I hope there are parts that are repealed, revised. I guess you'd say improved upon or removed."

Last year, Bell said Kansas hospitals provided about $900 million in uncompensated health care -- either charity care that was never billed or care that was billed but never paid for by the recipients.

Of the 127 Kansas hospitals, 56 received about $40 million in Disproportionate Share Hospital (DSH) adjustment payments for providing services to a significantly disproportionate number of low-income patients whose care was not covered by Medicare, Medicaid, the Children's Health Insurance Program or other health insurance.

Under the Affordable Care Act, most uncompensated care should disappear because a larger number of people would be covered by either Medicaid or commercial insurance provided by employers or purchased through exchanges. The need for DSH payments also would disappear.

Hutchinson Regional provided about $20 million in uncompensated care last year, but Miller is skeptical about whether the hospital would really see a $20 million increase in revenues.

"All of a sudden now magically the federal government is basically going to insure everybody and so a lot of that charity care, the need for it, will in essence go away if everybody has insurance," Miller said. "And take that $20 million, just for us, and multiply that times however many hospitals there are in the United States plus all the physician offices that are providing free care and you're talking about billions of dollars. So now you're going to be paying me for something I wasn't being paid for before. How's that going to work? How's the math of that work?

"It's probably going to come down to two ways. One is I have to believe it's going to increase taxes. And the second thing I have to believe is that what the federal government will do is pay me less per patient, per diagnosis, whatever unit we're talking about. So I'm going to be seeing all these additional folks, current plus some who haven't been seeking care because they haven't had insurance, I'm going to be seeing all those folks and I'm probably going to be paid the same or less because I just don't see the government being able to pick up all those bills that have gone unfunded so far."

Change is inevitable

Bell said that regardless of whether the Affordable Care Act goes forward or is repealed or greatly revised, health care is moving away from a model that rewards doctors, hospitals and other providers for the volume of their services to a model that rewards them for the quality and value of their services. The Medicare cuts in the Affordable Care Act, he noted, also were in conservative U.S. House Budget Committee Chairman Paul Ryan's Republican budget proposal. That means continuing pressure to hold down or reduce the costs of health care.

"Both parties are looking at ratcheting the system down," Bell said.

Miller, Bell and Praeger all agree that the escalating costs of medical care will have to be addressed beyond the Affordable Care Act.

"I've not spoken to a single health care professional, hospital leader or physician who doesn't recognize that our health care system is broken," Miller said. "It needs to be reformed. I'm just not certain this Affordable Care Act is the answer to fixing our system."

Miller contends that that nation needs to realign the incentives in the health care system.

For example, he said, the system currently offers incentives to doctors for the volume of services, the number of tests or procedures they provide. Hospitals are similarly rewarded for volume, but also for getting patients in and out of the hospital quickly "because we get paid the same for a gall bladder surgery whether its two days or 22 days."

Pharmaceutical companies, he said, are incentivized "to have you as a consumer on as many drugs as they can possibly talk you into." Insurance companies are incentivized to withhold approval for care because after they get the premiums, what they don't pay for services becomes profit.

"Average Joe says, 'By God, contain health care costs. It's ridiculous,'" Miller said. "That's until it's me or a family member, and then it's spare no expense."

With or without the Affordable Care Act, Miller said, Hutchinson Regional will "keep doing business the way we've been doing business, and that is we're going to continue to take care of people in our community the best way we know how, clinically competent, work everyday at improving our efficiency."

Coverage for all

The linchpin of the Affordable Care Act is the "individual mandate" upheld by the Supreme Court. The mandate requires that nearly everyone have health insurance -- through their employer, Medicaid, Medicare or individual plans purchased from commercial insurers -- or pay a penalty.

Some young, healthy people haven't purchased insurance because they didn't think they needed it or had other priorities for how they wanted to spend their money.

If the "young invincibles," as they are sometimes called, are compelled to buy coverage, insurance companies will have the revenues they need to also insure people with pre-existing medical conditions who otherwise could not get or could not afford insurance. The Affordable Care Act also guarantees that they could not be charged higher premiums because of their health condition.

The "guaranteed issue" under the Affordable Care Act would benefit not only those who have pre-existing conditions and no insurance but also those who feel trapped in jobs they have because they need their employer-based insurance and couldn't get or couldn't afford to buy individual plans in the commercial market, Praeger said.

She said she knows a man in Topeka who would like to quit his job and start his own business. But he can't because he has had a kidney transplant and needs the health insurance he has through his current employer, insurance he couldn't buy on the individual market because of his pre-existing condition.

Praeger thinks there are a lot of people out there like that.

"It's important as a county that we have a policy where everybody has access to care and the ability to pay for it," Praeger said. "The devil is in the details. (The Affordable Care Act) isn't perfect. But it's built on what we have, our system of employer-based coverage."

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