Unaffordable Medical Care Will Remain Unavailable

Unaffordable Medical Care Will Remain Unavailable
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The highly flawed Graham-Cassidy proposal failed to gain sufficient support and the highly flawed Affordable Care Act (ACA) remains the law of the land. Still lurking in the background is Sander’s single-payer plan, an idea equally flawed. No matter which health care policy prevails, the country remains the real loser. For neither party is willing to face the true problem with health care: the American medical system is unaffordable- and the costs are continuing to rise at an unsustainable rate. Any unaffordable system will necessarily be unavailable to large portions of the population and will continuously drain the vitality out of the economy. Until affordability is addressed, and the many reasons for the high costs are corrected, no solution is possible.

Proponents of the ACA claim that it has succeeded in getting rising health care costs under control and there is some slight truth to their statement. It has helped, slightly. Prior to the ACA, medical costs were increasing at over 8% yearly and total medical costs comprised over 16% of the GNP. As a result of the ACA, the cost increases did slow: to only 5.3 % in 2014 and 5.8% in 2015, a modest improvement, but still over double the rate of inflation. Health care expenses as a percent of the GNP continue to rise and by 2015 were up to 17.8%. (1)

The US per capita health care spending remains far and away the highest in the world with the US spending $9024 per capita in 2015. The second highest is Switzerland which spends $6787. Most of the other developed countries spend in the neighborhood of $4000 with Great Britain, for example, spending $3971 per capita.(2) In spite of our high costs, objective measurements of outcome show our care is not better than the other developed countries and is often worse. We just do more needless tests and procedures, waste more on defensive medicine, spend more on medications, pay more to insurance companies for administrative costs, and have a public demanding more and newer. The ACA skirted the root causes for our overpriced system. Instead what it did was to focus on increasing the number of Americans who had some kind of coverage. The private exchanges established by the ACA has had a minimal impact on helping Americans obtain affordable insurance, but what the ACA did accomplish was to allow more Americans, 11 million in all, to obtain free health care through existing Medicaid programs. But nothing is free.

Although the federal government pays the majority of Medicaid payments, since the 1990s, the portion of the state’s budget designated for Medicaid payments has increased from 9.5 to 19.7%(3)

Medicaid had been established in the 1960s to take care of the poorest and most vulnerable in our society. It has successfully done that for decades, but the ACA changed Medicaid eligibility to allow the able-bodied poor to participate.

Prior to the ACA, in order to qualify for Medicaid, a person’s income and assets had to be below a certain level. The ACA changed these levels so that the income for Medicaid eligibility was increased, that is, a person could earn more money and still qualify, and the asset level was entirely eliminated. The new people who now receive free Medicaid coverage can own land, properties, businesses, stock portfolios, and large bank accounts-as long as they can prove their income for the year was below the now higher eligibility levels. Last week I saw in my office a healthy 50 year old man on Medicaid who this week is in Europe on vacation. Such totally legal, but morally inappropriate and unfair, occurrences are unfortunately common. In Connecticut, my home state which is teetering on bankruptcy, over 200,000 more people are now receiving free health care because of the ACA which is paid for, in part, by the state.

The problem becomes even more complicated. Medicaid reimburses hospitals and practitioners for the now newly qualified adult Medicaid recipients, at lower rates than Medicare or private insurance. Their rates often fail to cover hospital and medical office overhead. Private practitioners frequently limit their Medicaid patients and welfare clinics have begun to spring up to care for these insured, but doctorless, outpatients. Hospitals compensate for their lost revenue from Medicaid patients by trying to increase their income from other insured patients. The pressure on hospitals and the hospital employed physicians to do more unnecessary things, including needless admissions and testing, in order to increase revenue is understandable and apparent. Unfortunately, it exposes patients to increased risk and causes higher premiums for those insured.

The ACA, as well as the Republican proposal, failed to address the major reason health coverage is unobtainable. It is unaffordable! Giving more people free coverage while others foot the bill is not the answer. Until spiraling medical costs are under control for everyone, improving availability will remain impossible.

(1) (http://www.chcf.org/publications/2016/12/health-care-costs-1).

(2) (http://www.pgpf.org/chart-archive/0006_health-care-oecd)

(3) Medicaid’s Mission Gallop, George Will, Waterbury Republican American. July 10, 2017, p6A

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