The ACA: A Good First Step

A few weeks ago my friend received a $150.00 check from her heath insurance company. The reason? It was complying with the new 80/20 rule whereby insurance companies can no longer spend more than 20% of premium monies on administrative costs. This means unless 80% of your hard-earned dollars went to your health care, you received a rebate for 2011. The result was that nearly 12.8 million Americans received more than $1.1 billion in rebates (averaging $151.00 per family.) But the real breakthrough is, for the first time, insurance companies are being held to a standard--one that ensures you receive the care you’re paying for.

So what of the protests against the reform saying the ACA treads on our inalienable rights by forcing us to buy health insurance? --That it’s socialism and will dismantle our economic system. Really? Let’s take a closer look.

The individual mandate stipulates that if you can afford insurance, you must buy it.  Why? Because if you don’t and you get sick (lost compensation to area hospitals in 2010 and 2011 ranged from $9.5 million in Greenwich to $16.5 million in Bridgeport) or have an accident (many of the victims of the recent Colorado shootings were younger and had no insurance yet face years of rehab and medical costs) you force society, that’s all of us who do pay for health insurance, to pay for you.  So, the reform says either you buy insurance or you pay a tax to cover the shortfall you’re asking all of us to pay.  As more people are covered, insurance pools grow bigger and risks spread wider, resulting in lower rates for everyone. With more people buying insurance, companies are forced to compete—yes, I said compete—for your business through improved service and care.  Fostering competition is the cornerstone of capitalism. Buying insurance is being a responsible citizen.

But why should I have to subsidize insurance for the poor? Aside from the importance of spreading the risk to lower costs, let’s not forget that we already do pay via our highest-cost delivery system—the emergency room. This reform will help reduce that problem in two ways: First and foremost, it supports the insurance industry’s paradigm for success—that is, providing “the right care, at the right time in the right place.” Instead of an uninsured person going to the ER for an earache costing hundreds of unnecessary dollars lost to the hospital and passed on to you, he or she can now go to “the right place” for the “right care”—a doctor’s office or clinic, at a fraction of the cost.  Second, according to estimates from industry experts that   every dollar spent in prevention saves ten dollars in care, the ACAs preventive care requirements in the long-term will lower medical costs for us all.

The tragedy of all the demonizing we hear about the ACA in political rhetoric is that it undermines the bill’s intent: to protect Americans and improve care. Even more distressing is that it prevents serious attention to improving it. Frank Covino, President and CEO of Greenwich Hospital, an advocate of health care reform, feels that although the ACA dealt with the insurance and financial issues, there are still a variety of opportunities we need to address in areas like tort reform, recognizing the value of alternative care methods, creating incentives for young people to enter health professions, and changing physicians’ and hospitals’ pay incentives so they’re based on quality and outcomes. And he is right.

The ACA was never meant to be the final answer to our multifaceted health care problem.  But it is the first step.  By reducing overpayments, tackling waste, fraud and abuse, increasing preventive care, and investing in more efficient models of care over the next ten years, we can reduce the deficit by more than $100 billion. As Congressman Jim Himes,  an ACA supporter explains, “I have never claimed that the final health reform law was perfect and, like any legislation of this significance and scope, it will require improvement over time. But it will serve as the foundation for the process of improving our health care system.” And that’s something we all need to recognize.

The ACA: A Good First Step

If we look, we will already see how the Affordable Care Act (ACA) is helping people.

A few weeks ago my friend received a $150.00 check from her heath insurance company. The reason? It was complying with the new 80/20 rule whereby insurance companies can no longer spend more than 20% of premium monies on administrative costs. This means unless 80% of your hard-earned dollars went to your health care, you received a rebate for 2011. The result was that nearly 12.8 million Americans received more than $1.1 billion in rebates (averaging $151.00 per family.) But the real breakthrough is, for the first time, insurance companies are being held to a standard--one that ensures you receive the care you’re paying for.

So what of the protests against the reform saying the ACA treads on our inalienable rights by forcing us to buy health insurance? --That it’s socialism and will dismantle our economic system. Really? Let’s take a closer look.

The individual mandate stipulates that if you can afford insurance, you must buy it.  Why? Because if you don’t and you get sick (lost compensation to area hospitals in 2010 and 2011 ranged from $9.5 million in Greenwich to $16.5 million in Bridgeport) or have an accident (many of the victims of the recent Colorado shootings were younger and had no insurance yet face years of rehab and medical costs) you force society, that’s all of us who do pay for health insurance, to pay for you.  So, the reform says either you buy insurance or you pay a tax to cover the shortfall you’re asking all of us to pay.  As more people are covered, insurance pools grow bigger and risks spread wider, resulting in lower rates for everyone. With more people buying insurance, companies are forced to compete—yes, I said compete—for your business through improved service and care.  Fostering competition is the cornerstone of capitalism. Buying insurance is being a responsible citizen.

But why should I have to subsidize insurance for the poor? Aside from the importance of spreading the risk to lower costs, let’s not forget that we already do pay via our highest-cost delivery system—the emergency room. This reform will help reduce that problem in two ways: First and foremost, it supports the insurance industry’s paradigm for success—that is, providing “the right care, at the right time in the right place.” Instead of an uninsured person going to the ER for an earache costing hundreds of unnecessary dollars lost to the hospital and passed on to you, he or she can now go to “the right place” for the “right care”—a doctor’s office or clinic, at a fraction of the cost.  Second, according to estimates from industry experts that   every dollar spent in prevention saves ten dollars in care, the ACAs preventive care requirements in the long-term will lower medical costs for us all.

The tragedy of all the demonizing we hear about the ACA in political rhetoric is that it undermines the bill’s intent: to protect Americans and improve care. Even more distressing is that it prevents serious attention to improving it. Frank Covino, President and CEO of Greenwich Hospital, an advocate of health care reform, feels that although the ACA dealt with the insurance and financial issues, there are still a variety of opportunities we need to address in areas like tort reform, recognizing the value of alternative care methods, creating incentives for young people to enter health professions, and changing physicians’ and hospitals’ pay incentives so they’re based on quality and outcomes. And he is right.

The ACA was never meant to be the final answer to our multifaceted health care problem.  But it is the first step.  By reducing overpayments, tackling waste, fraud and abuse, increasing preventive care, and investing in more efficient models of care over the next ten years, we can reduce the deficit by more than $100 billion. As Congressman Jim Himes,  an ACA supporter explains, “I have never claimed that the final health reform law was perfect and, like any legislation of this significance and scope, it will require improvement over time. But it will serve as the foundation for the process of improving our health care system.” And that’s something we all need to recognize.