The Patient Protection and Affordable Care Act: goals and challenges

Public health service: A renewed debate on the role of health Insurance

Nine pillars of the Affordable Care Act

The upside of the Affordable Care Act

Health reform for masses

Challenges posed by the ACA

Public health service: A renewed debate on the role of health Insurance

There are few other topics in the public health domain that have stirred more controversy than the Patient Protection and Affordable Care Act (PPACA) effective from March 2010. The law was part of the Obama administration's most significant effort to regulate the U.S. healthcare system. The main goals of the law were to:

a) Increase the quality and affordability of healthcare insurance

b) Lower the rate of uninsured population using a more expanded insurance network through private and public insurance companies

c) Reducing the healthcare cost for the U.S. government and individuals

The bill aimed to alter the healthcare insurance by lowering the minimum standards for obtaining the subsidized insurance under PPACA and universal coverage with same rates of service irrespective of the pre-existing conditions in patients. The Obama administration packaged the act with the catch line "responsible reform for the middle class" (U.S. GPO, 2010). The major advantages of the Affordable Care Act as outlined by the federal government considered the act as a transformation of the U.S. healthcare system. The paper analyzes the hotly debated Affordable Care Act (ACA) promulgated in 2010. Section two of the paper highlights the main aims and objectives around which the ACA has been drafted. Section three highlights some of the advantages that ACA promises to bring forth to the American health healthcare system. Section four analyzes the potential drawbacks and challenges posed by the ACA. Section five of the paper concludes the discussion by restating the main points of being highlighted.

2. Nine pillars of the Affordable Care Act

The Affordable Care Act was based on nine basic tenets addressing one essential area within the healthcare system. The major aim was to make the healthcare system affordable and qualitative for all Americans. The role of public programs was to be reinvigorated through the Affordable Care Act. The program also aimed to provide revenue provisions for healthcare practitioners and encouraged community assistance services and therapies. As part of the immediate improvements sought by the program, the government was to prohibit rescissions of health insurance policies. The act also prohibited the insurance companies from leaving citizens out of the insurance pool due to pre-existing conditions. The age for dependent coverage was increased to 26 and immunizations, and preventive services were to be made part of the insurance plans in the future. An important regulation measure of the act was to cap the administrative and non-service expenses. The information dissemination within the insurance industry also required reformation and transparency under provisions of the act. An internal portal was to be established under the act that would provide Americans with the needed information related to choosing insurance plans.

The plan also aimed to reform the insurance market by ending the practices of medical under-writing and treatment of patients on the basis of health status and family genetics. The American Health Benefit Exchange was also created that would provide new formats of health plans and out of pocket requirements were barred beyond health savings. Each U.S. State was mandated with the development of health benefit exchange. The insurance was made available to people with incomes between 100 and 400% of the federal poverty line. The act also introduced the shared responsibility to encourage minimum essential coverage of healthcare through insurance. Medicaid was extended to children, parents and childless adults not entitled for Medicare and were up to 133% below federal poverty line. Child health insurance programs were also introduced, and the U.S. states under the Affordable Care Act would maintain income eligibility levels for CHIP through 2019 (U.S. GPO, 2010).

3.1 Health reform for masses

The healthcare reform that the ACA aims to introduce has been projected as the program for masses. President Obama has been consistency using different mediums of communication and methods to convince the general public regarding the effectiveness of the ACA. Jacobs and Skocpol (2012) observed that:

"When the provisions are effectively implemented, seniors, the sick, and average Americans-including many families in the upper middle class will receive wider and easier access to health insurance benefits protected from trickery by the insurance industry" (Jacobs & Skocpol, 2012; p. 122).

There are several statistics that Jacobs, et al. (2012) presents as evidence to their claim that ACA will improve the healthcare coverage and induce better service delivery in the U.S. healthcare system. Authors observed that the number of uninsured working-age Americans and their children will reduce by 32 million. Authors based their statistics from figures sourced from the Congressional Budget Office (CBO), a non-partisan entity. Under the ACA, the healthcare coverage will be obtained by 83% of the legal immigrant residents (Jacobs, et al., 2012; p. 122). It is pertinent to mention that the program is designed in a way that low and middle-income families will obtain the maximum benefit from the ACA whereas economically advantageous population segments will have to bear the additional costs. Through increased participation in the program, the government aims to reduce the overall cost of delivering health service. Table 1 highlights the major implications of the ACA on four demographic groups of the U.S. population.

Table 1- Anticipated implications of the ACA on population segments

Population Segment

Implications of ACA

Medicare dependent Retirees (45 Million)

Cost reduction in pharmaceutical medications

Expansion of primary care

Protection against 100-common abuse of seniors

Young Adults

Ability to remain on family insurance plans up till the age of 26

Qualify for Medicaid if income below $14,444

Middle Class Americans

Mandated to forfeit health insurance with minimal coverage and low premiums

More coverage with high premiums

Population in Upper-income segment

Added Medicare Tax of 0.9% for income earning (above $200,000 for Single, $250,000 for married)

Adapted from: (Jacobs, et al., 2012) and (Steber, 2013)

4. Challenges posed by the ACA

The act became so controversial that lawsuits were filed in several U.S. states including Ohio, District of Columbia, Michigan and Florida (Howell, Williamson & Wyatt, n.d.). Attorneys of these states argued that some provisions of the act violated the Commerce Clause of the U.S. Constitution thereby making it mandatory for individuals to purchase health insurance. The Individual Mandate provision of the PPACA (P.L. 111-148, PPACA) requires all Americans must purchase healthcare insurance policy from 2014 or face a federal penalty. The U.S. Supreme Court stroked down the individual mandate provisions stating that they violated the Commerce Clause. The court held that the Individual Mandate under the current provisions is unconstitutional. Another blow to the ACA provisions was that the Supreme Court stroked down the requirement for states to participate in Medicaid expansion or their Medicaid funds will be withheld by the Federal government. The Court held that the provision is an overreach by the Federal government. The Court held that the participation in the Medicaid expansion shall be voluntary. The striking down of the certain provisions of the ACA may impact the likely success of the act in bringing 94% Americans in the health insurance net. The Obama administration bragged about the likely success of the act without taking into consideration the potential legislative flaws that act could face. It also seems that a majority of the projections done by the CBO were based on the premise that every American over a certain age will have to purchase the insurance plan. Since the premise has been eliminated by the Court's ruling, bringing 94% of Americans into the healthcare system's network seems to be a daunting challenge for the Federal government.

Rago (2014) points out that the CBO admits the fact that a 'substantially large and considerably higher labor force will be subtracted due to the enforcement of the ACA. By 2024, around 2.5 million Americans will work less or not at all as a consequence of obtaining medical subsidies. Mr. Casey Mulligan, an economist by profession estimates that the ACA will make the economy contract by 3% by 2024. One of the most interesting and somewhat plausible criticisms on the ACA is that insurance subsidies are tied to income of an individual. The individual's right to obtain the subsidy will be absolved once he/she earns income higher than the eligibility threshold. Therefore, individuals will be encouraged to remain poorer in order to continue obtaining insurance subsidies. The ACA reform is too ambitious in transforming the healthcare insurance coverage, quality, efficiency, prevention and healthcare workforce (McDonough, 2012; p. 201). It touches too many reform agendas at once and leaves considerable room for writing definitions and rules that may take considerably longer to realize the promised results (McDonough, 2012). The ACA will be partly funded through federal borrowings that will increase the federal debt in the long-term. The U.S. Federal government is already heavily indebted, and an increase in debt is bound to impact the overall risk of the government. It seems that the benefits of the ACA are overpromised, and the administration made these promises on some initially over-simplistic premises. The first premise was that since individuals will be mandated to purchase insurance plans, the overall coverage will automatically increase to 94%. Secondly, all the states will be self-motivated to participate in the Medicaid plan otherwise they will risk losing the federal funding. Thus, any plausible person will not choose the latter option. However, with the Supreme Court striking down both the provision, the estimations developed on simplistic premises are getting challenged by expert economists like Mulligan. The CBO too of revising its initial estimates of the impact of ACA based on Mulligan's seminal work regarding marginal tax-rate. Further, it can also be assessed from the findings reported in Table 1 that the middle-income and the upper-income groups will be economically hard hit by the ACA provisions. It is yet premature to argue that if benefits of the legislation will outweigh the drawbacks. The opposite seems more plausible given the changes in the original legislation. The issues are still not at rest and researchers and economists are continuing their effort to highlight pros and cons of the legislation. Jacobs, et al. (2012) made a more appropriate observation regarding the ACA and the authors commented "almost every outcome remains possible: sudden reversal, protracted defeat, or long-term success" (p. 147).

5. Conclusion

The Patient Protection and Affordable Care Act (PPACA) that took effect from March 2010 is one of the most controversial public health topics currently under debate. The reform agenda under the ACA has attracted wide appreciation but a growing criticism as well. The ACA reforms of the U.S. healthcare system are aimed at increasing the quality of care and affordability of the healthcare insurance. The reform promises to increase the insurance coverage to 94% of the total U.S. population and reduce the healthcare cost for government and individuals. It seems that the ACA successfully addresses the key underlying challenges of the U.S. healthcare industry as identified by researchers i.e. taking measures to improve the quality of care and insurance coverage. A major flaw (that may impact the initial estimation related to the insurance coverage under ACA) was identified by the U.S. Supreme Court the court stroked down provision related to participation of states in the Medicaid program and the individual mandate provisions. Number of critiques argues that the legislation will induce the subtraction of substantially large and considerably higher labor force from the U.S. labor market. More than 2.5 million Americans may work less or not at all due to receiving ACA related insurance subsidies. The issue is not laid to rest until the impact of the ACA led reforms finally surface, either positive or negative.