On March 23, 2010 then-President Obama signed into law the Patient Protection and Affordable Care Act (ACA) whose intention was to make health insurance available to a large number of then-uninsured Americans. More than twenty million new persons were covered as a result of the Act, and the Act also contained provisions that fundamentally changed what insurance companies were allowed to do, for instance, requiring coverage for people with pre-existing conditions, covering children who lived in their parents' households until age 26, covering certain preventative treatments such as birth control and prenatal care. Aspects of the Act were controversial. The enlargement of Medicaid subsidies proved burdensome to many states, and there was both religious and ideological opposition to aspects of the bill, particularly those affecting women, and the mandatory coverage requirement was opposed by people who object in principle to government intervention in private choice. Although the Republican Party campaigned on a platform of repealing the ACA, when the 115th Congress convened in January of 2017, the "repeal and replace" bill that they initially introduced was withdrawn for anticipated lack of support. A modified bill might be re-introduced before the July 4 summer recess begins for Congress. The data in your textbook predate both the Affordable Care Act and any replacement bill that might be brought before the current Congress, but these bills do not directly affect the cost of particular treatments, which is the concern of your text, but rather the cost of insurance coverage for those treatments. Insurance operates on the principle of averaging risk and averaging cost, so the matters very much whether the buyers and sellers in the insurance pool experience extraordinary risk or charge extraordinary cost. There are good reasons to scrutinize how health care is financed in the United States. Comparing the US to its nearest neighbor, Canada, which has a single-payer plan (as well as private-pay coverage), US citizens pays about twice as much per capita for healthcare as Canadian citizens do. The following online article from the PBS New Hour gives a summary of costs in other western nations. http://www.pbs.org/newshour/rundown/health-costs-how-the-us-compares-withother-countries/ What I would like you to do in this essay, leaning on things you have already learned about insurance, is consider why it might be difficult to obtain broad support for insurance reform in the US given our conflicting feelings about private choice and universal rights. The following are some of the discussion points that surrounded both the ACA and its potential replacement bill. You may choose one of them, and discuss your understanding of the problem and what resolution of the conflict by means of compromise you would prefer (assuming you can imagine a compromise on some of these issues). First, though, in one sentence: Do you believe personally that health care is a human right? The Controversies: 1. The mandatory coverage provision of the ACA: Presently, US citizens must report on their tax return whether they have health insurance coverage, and if they are not covered by an employer and also opt out of the insurance exchange they are charged a fine. The bill introduced to and withdrawn from the 115th Congress made insurance coverage voluntary. This creates a problem of adverse selection and would undoubtedly raise premiums for employers and those who are privately insured. Can you think of ways that we might address the disparity in risk between young people and older people, those with preconditions and those without, groups that are higher risk because of environmental conditions? Would it be possible (and acceptable) to have highly resolute categories of risk that are charged different premiums so that risk-sharing is not absolute? For example, older people would pay higher premiums than younger people but not as high as they would if there were no young people at all in the pool. Private insurance does presently use resolute risk categories, but group insurance does not. Are there ways to make legally-required insurance more attractive and acceptable to low-risk people by making it resemble more the private insurance markets? 2. Pre-existing Conditions: Insurance companies do not like to cover pre-existing conditions without being able to rate the premium because they know that these individuals represent higher risk and distort the average risk of the pool. Accepting preconditions does raise the premiums for everyone in an insurance pool. There are many ordinary circumstances, however, where a person with an expensive condition loses their insurance and would suddenly find themselves uninsurable if the insurance exchanges (charging group rates) were not available. Do we have a social obligation to workers, for example, who lose their insurance coverage when they lose their jobs, to make sure they are not stranded with a condition that can no longer be treated? Can we design a system that will prevent this from happening, but without placing the higher risk obligation on the private insurance companies? 3. Placing the burden of Medicaid funding on individual States: Unfortunately there is a correlation between unemployment rates, low wages, drug addiction, poor health due to poor nutrition, single-parent families and unstable families, no insurance coverage and inadequate health care .... all of the social ills, in other words ... cluster together, and they cluster regionally. The States that are most stressed to provide Medicaid benefits are also those who find it most difficult to raise the needed funds by taxation. There is a serious question as to how much of the burden of health care insurance subsidies should be handled State by State, and how much is the responsibility of all US citizens and should be paid for by federal taxes. Our federal government and our States feel burdened by budget deficits, but it is clear that without these subsidies there are large regions of the country where the people will not be able to afford health insurance nor the fines for opting out of health insurance. What do you think is a fair distribution of cost when it comes to health care for the US population?
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