Cold Iron Truth

Why the Affordable Care Act will be greatly modified


 

Health care rationing is an uncomfortable topic, but one that responsible Americans should discuss. In particular, physicians should consider this topic, because our typical response to health care is that “everything should be covered.”

Health care has always been rationed. Historically, in the United States, health care has been apportioned capitalistically; that is, those who could afford health care got it and the rest – particularly the poor – scrambled. In Europe and Canada, universal or government health care is rationed by long wait times, limited range of services, and formulary restrictions. It is important to note that in almost all countries with universal health care, there is still the option of quick access and more comprehensive service via a neighboring country (to the United States from Canada, for example) or a separate additional private insurance option (England, Germany, and most of Europe).

Dr. Brett M. Coldiron

Dr. Brett M. Coldiron

In the United States, the Affordable Care Act (ACA) changed the dynamic regarding insurance by adding mandates to cover preexisting conditions, mental health and substance abuse disorders, behavioral health treatment, prescription drugs, rehabilitative services, preventive care, and pediatric services including oral and vision care for children. In addition, adult children now can remain on their parents’ insurance plans until age 26. Also, when the Cadillac tax on expensive health insurance coverage was delayed until 2020, the excise payments were classified as tax deductible to the employer. Whew, did I leave anything out?

Advocates for the poor and those previously considered uninsurable were delighted by the ACA. The middle class was mollified with false reassurances that their premiums would go down, and that they could keep their current insurance plans and doctors.

Currently under the ACA, “poor” is generally defined as a reported income of 150% or less of the federal poverty level ($22,000-$45,000). The poor are eligible for health care that is very nearly free, according to Medicaid.gov. They are also protected from claims against their property. They effectively have first-dollar coverage, though they usually can’t see a specialist unless they go through the emergency department.

At age 65, Medicare takes over. Medicare is an insurance benefit workers contribute to for all their working lives. It doesn’t cover everything, but the relatively low $183 Part B deductible for office-based care sure takes the edge off. The average retirees collect three times what they put in, but they arguably could have made more if they had invested anywhere other than in the federal government.

So, the real crunch hits the middle class under age 65. Under the ACA, those earning up to $97,000 for a family of four get insurance subsidies to buy insurance on the exchanges. The real problem arises when a high deductible – the maximum for 2017 is between $13,000 and $14,000 – is combined with that level of income. There are over 20 million health care savings accounts in the United States, which ameliorate the cost for some, but health care savings accounts do not cover the entire deductible, and many cannot afford to self-fund them if their employer does not fund it for them.People simply do not have that kind of money put away in a disaster fund, and a major medical expense can easily wipe them out. If possible, they will ignore a medical problem; and if they can’t, they could risk financial toxicity by running up high-interest credit cards – with the predictable spiral of debt, collection agencies, credit ratings ruined, wages garnished, and even their homes repossessed. They aren’t going to use their health care coverage unless forced to by a disaster – or worse for the system, they have been saving their elective surgeries up and are ready for a major tune-up. The long list of mandated benefits has triggered a meltdown in the exchange markets and huge increases in premiums and deductibles for all insurance buyers. Who is going to pay for it? To quote the late Russell B. Long, former U.S. Senator:

Don’t tax you,

Don’t tax me,

Tax that fellow behind the tree.

Raising taxes and pouring even more money into the system might be a solution, but this is not likely to happen.

In the United States, the rationing of health care has been shifted from the poor to the middle class, and the middle class doesn’t like it. The situation will only change when the howling from the middle class is louder than the wailing from the formerly uninsurable and poor. As insurance premiums and deductibles continue to rocket up, I expect the howling will get louder.

So, either we agree to let insurance premiums continue to increase, our state budgets to explode, our taxes to go up, or we pare down the list of mandated benefits.

I am going on the record stating that we simply cannot afford “medical everything” for everybody. I think we should tighten up the benefit list considerably. What do you think?

Dr. Coldiron is in private practice but maintains a clinical assistant professorship at the University of Cincinnati. He cares for patients, teaches medical students and residents, and has several active clinical research projects. Dr. Coldiron is the author of more than 80 scientific letters, papers, and several book chapters, and he speaks frequently on a variety of topics. He is a past president of the American Academy of Dermatology. Write to him at [email protected].

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