The Affordable Care Act has been under intense scrutiny for several years. Unfortunately, the discussion is highly politicized and often fails to address the key issues. In this series of articles, we will attempt to bring focus to significant issues. What did the ACA intend to accomplish? Did the ACA “solve” those problems or inadvertently make the situation worse? If the situation is worse, where do we go from here? What are the implications for your insurance coverage, healthcare access, and finances?
What did the Affordable care act intend to accomplish-a bit of history
For the past 20 years, politicians, policy analysts, and health industry experts believed that our country was on the verge of a “healthcare crisis”. For example, the United States spends far more on health care than any other industrialized nation. The per-capita cost in the United States is by far the highest in the world. In 2013, the per-capita cost was $8,713. In comparison, Canada spent only $4,351 per person.
As a percentage of the Gross National Product (GDP), healthcare costs rose 8 % per year from 1999-2003. Growth in healthcare spending slowed between 2003-2009 to an average of 3.9% per year. At the inception of the Affordable Care Act, total healthcare spending was 16.4% of the GDP. “The truth is the American healthcare system has been growing at an unsustainable rate” and many Americans and businesses could no longer afford medical insurance.
Several other factors contribute to the “healthcare crisis.” One major issue pertains to shifting demographics. The US Census Bureau recently reported that, by 2020, people ages 65 and over will outnumber children under the age of 5. This is a global trend and will only continue to increase. Second, fewer middle class families can afford to self-fund their healthcare into retirement. As the population continues to age, there will be higher demand for medical services. and 3) an increasing number of Americans who were uninsured or underinsured entering into retirement.
There was a growing problem for those who with insurance. People lost medical coverage when their cost of care became greater than what they paid toward their insurance premium. As a consequence, insurance companies began to cancel policies. For those who lost coverage, discovered they had little to no legal recourse remedy their problem. There was also the belief that people without insurance did not have access to health care. As a result, insurance needed to be provided to that group in order for to establish adequate access to care. These were among many of the problems that ACA sought to address.
What were the goals of the affordable care act
The Affordable Care grew out of a desire to improve the affordability, quality and availability of health insurance. The legislation implemented new rules and regulations in an attempt to contain rising costs. The new regulations affected public and private health insurance companies as well as health care providers resulting in additional administrative expenses for both the insurance and health care providers.
There were three primary goals to The Affordable Care Act: 1) Greatly increase the number of Americans with health insurance. By providing insurance to everyone, people would be more proactive in receiving health services resulting in a reduction in expensive emergency room visits. The expected outcome is that people would go to their primary care physician instead of the hospital.
2) Protect the public against arbitrary actions by insurance companies. People were denied coverage they had a pre-existing conditions and/or ongoing chronic medical needs. The intent of ACA was to insure that those individuals would have adequate medical coverage.
3) Reduce insurance and medical costs. By increasing the number of insurance enrollees, new revenue is added to the healthcare system. Young adults, who don’t generally need expensive care, pay into a system, so that enough money is available to pay for those that need healthcare. Additionally, prevention became an emphasis in an attempt to shift the focus away from treatment.