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Unintended consequences

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The true heart of the Affordable Care Act, sometimes referred to as “Obamacare” but termed here as simply the ACA, is the structure it provides for the maintenance of adequate, portable, comprehensive and reliable private health insurance to all of us and our families.

For most of us the impact of this law and the changes it wrought have been invisible. For the healthy among us, who were happy to remain in the same employment with already adequate insurance, who did not encounter disastrous illness or injury, and who were without disabled children, the advent of the ACA brought nary a ripple.

One sizable bunch did see an immediate benefit. The self-employed, such as small-firm professionals and the like, who might have been paying for health coverage at very high individual private insurance rates, and the part time or low wage employee who did not receive insurance from their employment and could not otherwise afford private policies, both suddenly found adequate health insurance available through state exchanges at rates equivalent to that charged large employers and groups, and with significant federal subsidies for the lower rungs of qualified individuals.

While there were many process problems getting the bugs worked out of the exchange machinery, there have been few complaints over the products that popped out, or to the ultimate cost of it to the qualified participants. These participants have joined the majority in enjoying adequate, non-cancellable, portable, comprehensive and reliable private health insurance at an affordable cost.

Not so much is heard of any of the essential changes brought about by the new law, for the simple reason that they appear to be working exactly as designed. For the first time ever, most of us no longer worry about a catastrophic illness or injury blowing through the ceiling of our health insurance, or having a company cancel coverage in the middle of difficult times, or of being chained to ill-fitting employment because of the risk of being trapped by a preexisting condition clause, or of having a recommended treatment denied by bureaucratic action with no recourse to have the matter reviewed or reconsidered, or of keeping adequate coverage for a child all the way through college.

These matters do not affect most of us, but for the millions and millions who have been affected by any one of these elements in their lives or the lives of their loved ones dependent upon them, the saving provisions of the ACA have provided immeasurable relief and peace of mind.

The only foghorn clamoring away, usually from the right, has been connected to the fact that premiums have gone up. But the ACA doesn’t touch premiums; it is based on private insurance, which requires private payment of premiums, which is connected to actual costs. From the beginning it was made clear that health care costs would be going up, and premiums were going to rise. The major omission the critics make is in failing mention that premiums have not increased as fast or far as was predicted without the adoption of the ACA. The rate of growth of health care costs has flattened, and the increases that are coming are not as great as once feared.

All of this means that for most of us, we have grown complacent; the ACA is working just fine, thank you, and we would not like to see any of it lost. The few of us who are complaining about the cost would complain anyway – with or without the ACA. Notwithstanding the campaign rhetoric coming from the parade of Republican beseechers, we all know there is no realistic political chance that the country is going to reverse course on health care now. Too many of the core provisions are proving to be too valuable and too popular for anyone to seriously suggest a complete repeal. Even the wannabees, when pressed on details, hide behind promises to save the best provisions of the act which, when one tracks down and adds up all the promises, turns out to include it all.

There is this nagging problem. Through the willful act of several of the states, including Idaho, the ACA is not being permitted to fully engage the entirety of the health insurance coverage that was expected. The individuals left at risk are among the very poor and helpless – those without clout or means, and who are now being ignored for the very worst of reasons – spiteful politics.

Under the ACA, everyone who is gainfully employed or occupied is supposed to be guaranteed access to affordable health coverage, either through their employer or through a state exchange. The exchange is available to anyone who is employed but does not receive insurance through employment or who is self-employed. The coverage is still private coverage by private insurers, although the premiums may be subsidized for qualified individuals. The purpose of the exchange is two-fold: (1) to make insurance available at what amounts to group rates, rather than individual rates, and (2) to establish subsidies where needed. To make this work, it is required by the act that a participating individual have some level of income, measured at a percentage of the poverty level established for the state, in order to qualify for private health insurance through the exchange.

The requirement for a floor level of income to participate through an exchange meant that those individuals who earned less than the required percentage to qualify for insurance through the exchange, but who, for any of a variety of reasons, might not qualify for standard Medicaid – would remain uninsured. In Idaho, for example, this gap consists of approximately 78,000 individuals, all uninsured.

The solution under the ACA was to provide that the states would increase the eligibility level of Medicaid to include by definition all individuals in this gap. This expansion of Medicaid is fully funded under the ACA, with all revenue measures in place. There will be no cost to the states at all for the first 10 years of the ACA; after that, the federal government will pay 90% of the increased benefit cost, with the states paying 10%.

No one anticipated what actually happened. The Supreme Court struck the mandatory provision for expansion of Medicaid. And, despite the fact that it is integral to providing seamless coverage to the poorest, despite the fact that it is fully funded for ten years so comes at no cost to the states, and despite the fact that by not buying into the Medicaid expansion, the states gives up hundreds of millions of dollars in federal grants – 26 states declined to expand, and continue to decline to expand their Medicaid programs.

One of those states is Idaho. The governor and the legislature refuse to even consider the expansion bill. A bill for the expansion has been introduced every year, but has yet to be mentioned by the Governor in his state of the state message, or to see the floor of either house for a vote.

If Medicaid were so extended, the ACA would provide a seamless blanket of coverage available to essentially everyone. In Idaho, the expansion of Medicaid could replace almost the entirety of several state and county programs for indigent care and catastrophic care, currently running state and counties approximately $63 million per year. The benefits, which might have been paid to medical providers in Idaho on behalf of this group for the current years, have been estimated to be in the range of $73 million per year. If one adds these resources together, Idaho has already watched close to $272 million slip through its fingers by not expanding Medicaid originally, and the state is losing somewhere in the range of an additional $136 million per year for every year it does not act.

This is not all. We, or at least some of us, are paying those specific federal taxes created within the ACA for funding the expansion of Medicaid nationwide. No credit exists or refunds for those states that have not gone along. Our money derived from these tax sources within Idaho is not being returned to our state, and must be added to the losses sustained by Idaho for not approving the expansion.

As Idaho heads into the third legislative session since the rollout of the ACA, the subject will come up again. Every single outside interest group that has looked into this has recommended expansion. Other alternatives to expansion are woefully inadequate and there is no valid, logical reason for continuing to withhold. Perhaps the wisest of the group who will be assembling here next week will see at last that there is no U-turn on the horizon for the ACA and that money is money is money.

Pry the thing out of committee and pass the damn bill.

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