Global Perspectives on Health Policy and the ACA

Introduction: Health Insurance as a Policy Problem

The American health insurance system is riddled with drawbacks, including continuously escalating premiums and difficulty finding adequate coverage. While employers seldom provide car or home insurance — nor should they — the employer-provided health insurance model carries its own distinct limitations. One significant deficiency is that employees have very few options when selecting from employer-sponsored health plans, often choosing from only two or three plans, which may all be products of a single insurance company. Unlike the automobile or home insurance markets, the health insurance market does not offer the same competitive variety, and the available plans may not meet an individual employee's specific needs.

A further drawback of employer-based health insurance is that coverage is typically revoked when an employee leaves a job — a serious concern in an uncertain labor market (Basu, 6). If a new job with health benefits is not immediately available, the individual must navigate the local marketplace for suitable coverage. Should that person have a pre-existing medical condition from prior employment, they will face significantly higher premiums on any new health insurance application, or may even be denied coverage entirely. This is because pre-existing conditions place applicants in a higher risk category (Basu, 6).

These systemic challenges in the health insurance landscape created the conditions that prompted legislative action at the federal level, ultimately leading to the most significant overhaul of American healthcare policy in decades.

In response to the challenges described above, the Obama Administration introduced the Patient Protection and Affordable Care Act. The act proposed to protect every American's access to basic health care and to enshrine that protection in law. Popularly known as the Affordable Care Act (ACA) and nicknamed Obamacare, the law was passed and signed by the president in March 2010. Among its most significant changes, the Act eliminated the exemption for pre-existing medical conditions that had previously allowed insurers to deny coverage based on a person's medical history. It also extended insurance to over 30 million previously uninsured Americans through the expansion of Medicaid and the provision of federal subsidies enabling lower- and middle-income Americans to purchase private health insurance (HealthCare.gov).

The Patient Protection and Affordable Care Act was officially enacted on March 23, 2010. One of its primary aims was to regulate and reform the health insurance industry. The ACA provides both consumers and providers with new mechanisms to hold insurance companies accountable. Its notable provisions include the following:

Insurance choices: The primary objective of the law is to open health care coverage to the majority of American citizens. Under the ACA, individuals may choose from Medicaid, Medicare, state-based insurance exchanges, or private insurance (Lachman, 248).

The Affordable Care Act and Its Key Provisions

Insurance costs: Insurance companies are held accountable under the ACA, which is intended to help keep medical costs down for individuals, though outcomes have varied in practice.

Value for premium dollars: Under ACA bylaws, insurance companies selling coverage to individuals and groups must spend a minimum of 80% of premiums on medical care and quality improvement.

Lifetime and annual limits: The ACA restricts and eliminates annual dollar limits on benefits, protecting consumers from having coverage capped at a critical time.

Rate review: Insurance companies are required to provide proper documentation and justification for any rate increases (Lachman, 248).

Rights and protections: Under the ACA, consumers — rather than insurance corporations — are placed in control of their personal healthcare decisions. Key consumer protections include:

Preventive care: Consumers are not required to pay co-insurance, co-payments, or deductibles prior to receiving preventive health services such as counseling, vaccinations, and screenings.

Doctor choice and emergency room access: Consumers may select any healthcare provider of their choice and may use out-of-network providers without obtaining prior consent from a primary physician.

Protections for those 65 and older: The ACA provides a broad range of preventive health care services for older adults at no additional cost-sharing (Lachman, 248).