Arguably the most important and polarizing policy issue of the Obama administration’s first term, The Patient Protection and Affordable Care Act (PPACA) and the Health Care and Education Reconciliation Act of 2010 – known together as the Affordable Care Act (ACA) – will define the president’s time in office for the next four years. The law is set to become fully implemented in 2014, which means the Obama administration is responsible not only for its execution but also troubleshooting its initial setbacks. The goal of the ACA is three-fold: 1) expanding Medicaid eligibility; 2) prohibiting insurance companies from denying coverage due to pre-existing conditions; and 3) requiring states to establish exchanges, virtual marketplaces where previously uninsured individuals and small business can afford to buy coverage.1 While the second prong puts the impetus on private insurers, the first and third require significant action by state and federal government agencies.
New Medicaid requirements, which extend eligibility to those within 133% of the federal poverty line, will go into effect during 2014.2 These measures will insure 32 million new Americans by the end of 2019.1 To cope with this influx of eligible customers, the ACA mandates the installation of exchanges in each state. These exchanges will be set up during 2013 and are expected to be functional by 2014.4 Though some states will set up the exchanges independently, several states opted to allow the federal government to initiate the set up, leaving the states themselves to take over operations later.4 The primary responsibility of the Obama administration is to design different methods of presenting insurance information to consumers on a virtual platform and testing these methods in various regions of the country. The administration has many considerations to bear in mind: the diversity of the consumer pool, the accessibility of the exchanges, the availability of informed representatives who can assist consumers, and identifying the types of plans that would be most successful in different regions. Because these exchanges encompass so many demographics and consumer pools, they will be significant tools in evaluating the development of market factors, consumer choices, and enrollment statistics.4 Therefore the Obama administration should also consider recommending basic data records for all exchanges. This data will be crucial in evaluating the success and failure of various types of exchanges and insurance options.
Though the full impact of the ACA’s Medicaid eligibility expansion won’t materialize until after the end of President Obama’s second term, his administration should take proactive measures to head off a serious consequence of this rise in insured Americans: the lack of primary care physicians. Even without factoring in the influx of new patients, analysts estimate a shortage of 100,000 physicians by 2020.1 This shortage can be attributed to many factors, the most compelling of which is the significant discrepancy between the salaries of primary physicians and those of their peers specialized medical professions. The ACA attempts to ameliorate this discrepancy by giving physicians a 10% bonus payment on services granted to Medicare beneficiaries – though these bonuses will only be effective through 2016. The Affordable Care Act also authorizes programs that forgive loans of clinicians who agree to work in underserved areas for a contracted period of time.1 While the second of these two regulations will increase incentives for doctors to practice primary care, the time limit on the first will not allow for a significant increase in the pool of primary care physicians.
Despite the wide scope of the ACA’s goals, there are two imperative reforms it fails to integrate: 1) the transition from a fee-for-service to an efficiency-based method of payment for physicians and 2) the concrete establishment of and adequate support for accountable care organizations (ACOs), which are responsible for managing the care of a defined population of at least 5000 individuals.1 The first of these problems, a fee-for-service system of payment for physicians, has long been cited as a failure of the American medical system. This method rewards physicians for the number of procedures they prescribe rather than efficiency of treatment or quality of care. An ethical dilemma is presented: a physician who fails to treat a patient but prescribes many tests can make more money than a physician who correctly diagnoses and treats a patient with fewer tests and procedures. This method clearly rewards quantity over quality and therefore cannot be considered a best practice that should be carried into the new era of healthcare. While it is not immediately clear what kind of payment system should replace the current one, the Obama administration should promote the development and evaluation of alternate systems as these could increase the scope of treatment primary care physicians are able to provide. Given that the American College of Physicians regards primary care as “the backbone of the nation’s health system,” the Obama administration should utilize this opportunity to reform the way primary care is delivered to patients and incentivized for physicians.
Another reform which the administration should consider strengthening is support for accountable care organizations. ACOs, which allow providers to form a network that produces the most accurate and efficient outcomes, provide exactly the kind of low-cost, high-quality care the ACA promotes.3 Though the Obama administration has, under the direction of the Secretary of Health and Human Services, succeeded in creating a Medicare shared savings program that launches in January 2013, they should realize the private sector is not far behind. Private insurers such as Aetna, UnitedHealth Group, Cigna, and Blue Cross are already planning to link with ACOs, with more companies reportedly following suit.1 ACOs are relatively new institutions in the healthcare field and should therefore be thoroughly investigated and tracked in their development. President Obama should either provide supplementary funding or incentives for private ACOs to encourage wider participation, since the nation’s medical system is a constant balancing act between public and private providers. Supporting private ACOs, such as those linked to the aforementioned insurers, in addition to public ACOs, is imperative to the success of the Affordable Care Act and the goals it seeks to fulfill.
Though the Affordable Care Act was a tough dose for many to swallow during President Obama’s first term, politicians and Americans alike have come to realize that it may lead to some much-needed reform after all. If the Obama administration bolsters certain aspects of the ACA, such as support for primary care services and data collection, they should ensure that the healthcare law is remembered as a monumental piece of legislation, rather than yet another failed attempt to fix America’s broken healthcare system.
- Kemp, Kerry B. 2011. “Supply Side Implications of Insurance Coverage Expansions.” Academy Health.
- Holahan, John and Irene Headen. 2010. “Medicaid Coverage and Spending in Health Reform: National and State-by-State Results for Adults at or Below 133% FPL.” Kaiser Commission on Medicaid and the Uninsured.
- Japsen, Bruce. 2012. “Obamacare’s Accountable Care Approach Reaches 1 in 10 in U.S.” November 26. Accessed January 2, 2013.
- Summer, Laura. 2012. “Choice and Decision-Making in a Health Insurance Exchange: What Does Research and Experience Tell Us?” Academy Health.
- Image credit (Creative Commons): Mercy Health. 2012. “Doctors and residents working with patients at the JFK clinic in St. Louis. Dan Rey, MD – JFK physician. Nikole Forget, MD – JFK physician. Unnamed student.” February 28. Accessed January 21, 2013.
Ayushi Shrivastava is a second year student at the University of Chicago majoring in Public Policy and fulfilling pre-medical requirements. Her interests include global health, translational medicine, and health policy analysis. More articles about President Obama’s science policy are being published through the rest of January 2013.