What problems with Affordable Care Act provisions will we see in the coming years?
Problems with Affordable Care Act provisions are likely to surface over the coming years of the timeline even with the best intentions. The Affordable Care Act is a roadmap with many directions missing to get to the final destination. Many details have yet to be defined by the Secretary of Health and Human Services. A business plan without adequate details and planning is sure to fall short in several areas if not fail in its entirety. This Act is filled with broad theories and assumptions, but the details will be developing with the most critical coming in 2013 and 2014. We will all realize the impact of this monstrous piece of legislation as the administration implements critical components of the Act in 2013 and 2014. With the information currently available, I am concerned about several critical components of the Act. We will have to wait and see if everything happens as planned, but below is a list of things I am very concerned about as we go into 2013 and look ahead to the implementing the Affordable Care Act. We are about to change very landscape of Health Care and we will all be impacted in some way.
Increased Access to Health Care:
Problems with Affordable Care Act provisions will surface as coverage for young adults and preventative services become realized. Our employers will see increasing premiums to cover the costs making it more appealing to send us to Affordable Insurance Exchanges and pay their employer shared responsibilities. As we increase access to health care, we will increase demand for providers. The health care law invests in training, bonuses, scholarships, and loan repayment options to incentivize people to become primary care providers and nurses. We have yet to understand how the expansion to affordable health care will impact the demand on providers. Taxpayers will certainly share in the burden to incentivize qualified providers if the demand is too great.
Affordable Health Care:
The health care law will hold Insurance Companies Accountable. This will equate to lower margins as they are required to put more money towards health care costs. Insurance providers will likely pay fees to participate in insurance exchanges to further reduce margins. Entire industries do not accept considerable margin reductions. Reduced margin dollars will affect Insurance operations. These dollars will have to be recouped, or operations will need to be modified to maintain profitability. This could result in decreased payments to providers, operational layoffs, or steady premium increases under 10%.
We might see problems with Affordable Care Act provision arise from expansion of Medicaid to 133% of the Federal poverty line. Thrusting millions into Medicaid is sure to magnify the strain on an already strained group of primary care providers. Medicare prescription reductions and Medicare access to preventative services will have to be funded long term and hopefully not fall back on the taxpayers. I am particularly concerned about the impact on primary health care providers. Increased demand may impact our ability to receive timely care.
Affordable Insurance Exchanges:
Competitive marketplaces are to be formed by 2014. These state exchanges will require considerable operating plans to adhere to the requirements in the Affordable Care Act. There are no existing successful templates as the Federal government and States decide how to operate their exchange. We simply do not know if their operations are fiscally sustainable. If they are not, the American taxpayer may be funding the operations. We also have no idea how insurance companies will react to the competitive marketplace. Reduced margins and fees will surely decrease the appeal to offer products through the exchanges. There is no data suggesting in the private sector that competition between insurance companies results in lower premiums.
Affordable Care Act Employer Penalties:
One big problem with Affordable Care Act timelines falls on employers. Many employers will begin to pay penalties in 2014 for not offering minimum health insurance for their full time employees. When you look at examples, it may make sense for employers to stop offering insurance as premiums rise with expanded coverage and the cost of penalties becomes much lower than the penalties paid for not providing insurance. If we are sent to the exchanges by our employers, the product offering we find there will impact many. The best strategy for qualifying employers to minimize their exposure to Affordable Health Care Act penalties is to hire as many employees under 30 hours as possible. This will no doubt impact the hours that many employees currently receive directly resulting in decreased income in an already fragile economy.
Even the best intentions can result in problems. We will learn much over the coming years about the impact of problems with Affordable Care Act provisions. Many details will become clear as we move through 2013 and into 2014. We are about to change the dynamics of the entire health care industry, health insurance industry, and impact our employers bottom lines. My concern is the lack of details in the health care law. Without them, we simply don’t know how it will impact these industries ultimately impacting our lives. We will all have to watch as the administration implements key components of the Act over the coming years, and hope that those who wrote it and are implementing it truly understand the impact on billions of industry dollars. In such a fragile economy, a few billion dollar industries can have far reaching implications on the average American.