The researcher seeks to conduct a desktop study to trace the origin of the law by unearthing the source of the ideas that laid foundation for the law, the political leaders who influenced the act, defining the policy and discussing its provisions that include guaranteed issue, minimum standards, individual mandate, insurance exchanges, subsidization of premiums, employers mandate, and bundled payments as well as their implication in the health sector especially on medical insurance matters. The research will also incorporate the impacts of the policy on the American citizens, and these include a change in public policy on health, reduction in the number of the uninsured people, the individual mandate and the insurance exchanges, employers mandate, changes in the insurance standards, contraceptives, and cost of health care and insurance premiums. Peoples perceptions, misconception of the law as well as the legal battles that surround the issue will also be featured in the paper.
The Patient Protection and Affordable Care Act
Health care is a very crucial sector not only in America but also in the rest of the world since the economic performance of any country relies on the health of individuals as it promotes productivity as well as reduces mortality. However, many people are not able to afford quality health services due to the problem of poverty. Thus, there is the need for affordable insurance services to provide universal health care for individuals. The Affordable Care Act is the United States law that traces its roots to the late 1980s when efforts to reform the health sector began, even though most of them were futile. The major issues in the law are to increase the health insurance coverage for the American citizens and to promote health by reducing the costs of insurance to enable all individuals to afford the services. The success of the reform proposals only came to succeed at the national level after President Barrack Obama assumed office. This research will discuss the Affordable Care Act.
Place New Order
The Patient Protection and Affordable Care Act, which is also referred to as the Affordable Care Act, is a Law that was enacted in the United States in 2010 by the government of President Barrack Obama, and it was christened as the Obama Care. It marked a very crucial milestone in the health sector as it was meant to enhance the quality of health insurance as well as make it affordable, thus reducing the number of the uninsured people. The law compels health insurance companies to provide a cover for new clients within the set conditions and charge them the same amount irrespective of gender or the health conditions prior to the application for a cover; thus, the law aims at reducing the imbalances as well as the medical costs for individuals (Pear, 2012). However, the law was received with mixed reactions, and it was challenged in court by various stakeholders. Nevertheless, the Supreme Court upheld the legislation, but some labor unions, advocacy groups as well as small businesses continue to detest it for different reasons.
The efforts to enact the law started back in 1989 when the Conservative Heritage Foundation drafted a proposal for an individual mandate as opposed to a system where the government should bear the costs of medication singlehandedly (Avik, 2012). In 1993, Bill Clinton proposed a bill meant for reforming the health system by compelling the employers to insure their employees. However, the effort was futile as the Republican Senators drafted a counter legislation that was meant to order employees to cover themselves as opposed to being insured by their bosses. Several proposals continued springing out, and the state of Massachusetts was the first to pass a bill on health insurance exchanges and the individual mandate. The State Governor Mitt Romney, who was a Republican, refused to sign the bill but the Democrat legislators overpowered him, and he gave in (Barrett, 2012). The bill had become a model for which the United States drafted the bill that was to be applied in all the states (Ball, 2012). In 2007, a Republican Senator Bob Bennett and his Democrat counterpart Ron Wyden proposed the Healthy Americans Act that contained the individual mandate and the health insurance markets controlled by the states. Their effort, however, never bore fruits, but it became a foundation for the future attempts. In 2008, Democrats initiated health reforms based on the proposed bill of 2007, and it was structured the same way as the Massachusetts Health Bill (Kuttner, 2011). The proposal waded through the houses, and in 2010, it was signed into the law by the president.
Provisions of the Law
The law cautions health insurance companies against discriminating new applicants based on their health conditions or gender, and it further requires the insurers to charge the same premium amounts to all the clients who are within the same age group or live in the same place. This provision is an assurance to the people that they will not be denied insurance covers or will be charged more money than it is officially recognized for a given health package cover.
The New Minimum Standards for Insurance
The law prohibits insurers from terminating the covers of policyholders upon sickness, in an attempt to evade reimbursing money to cater for his/her medical costs. The Premium price discrimination based on gender, health conditions or membership to a given community is also illegal under this provision, and children are included in their parents covers until they attain the age of twenty-six (Cohn, 2013).
The Individual Mandate
The law compels all the employees who are not insured by their employers or not covered by public insurance programs to seek an accredited private medical insurance plan or to pay a fine. However, the individual may be exempted from paying a fine if he/she is poor or is a member of a sect that is recognized by the government.
Health Insurance Exchanges
The provision provides a way in which individuals, as well as businesses in all states, can assess the insurance policies and purchase the one that pleases them at a subsidized price. The provision aims at availing several choices for the interested parties as well as providing them with a subsidy offered by the government.
Subsidization for the Poor People
Due to the poor population, the bill allows for the sale of insurance covers to such people at a price that is lower than the normal one in order to enable everyone to have access to the medical insurance. The individuals pay a given amount while the government caters for the balance; thus, the latter caters for the poor.
The Employers Mandate
The law compels the employers to insure their workers, and for every business that has more than 50 workers failure to insure the permanent workers leads to a penalty (Vicini & Stempel, 2012). However, many businesses oppose the provision as it increases the costs of running a firm.
The Bundled Payment
In order to enhance the clearance of medical bills, the law stipulates that all the procedures involved in treating an individual be summed up and charged as a one as opposed to charging for a single medical procedure. The provision helps the patients by ensuring that the insurers pay all bills through the bundle payment as opposed to single service payments that might fail to capture all the service charges.
Consequences of the Bill
The Individual Mandate and the Insurance Exchanges
The Act led to the introduction of the individual mandate that compels any individual who is not insured by his/her employer to purchase an accredited private insurance or pay a fine. This rule compelled individuals to make sure that they have medical insurance cover. The law gave birth to the insurance exchanges whereby accredited covers are sold online in markets that are controlled by the respective states, and this enabled individuals to weigh various options on covers and select the suitable ones. The exchange gives states the mandate to control health issues, thus devolving the function that, in turn, promotes service to all people. However, the online market is threatened by cyber security issues as well as technical failures such as crashing of the system.
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A Change in Public Policy
The bill was incorporated into the law in 2010. Therefore, health insurance became a public policy. The Act became the most crucial amendment in the American health care (Vieni and Stampel, 2012). The impact was an increase in the number of insured people, reducing the uncertainty through the spreading of risks via the insurance companies. The subsidization of the insurance lowered the costs, which enabled many people to afford the purchases. Violation of the policy attracts penalties for an individual as well as the employer.
Impact on Costs of Healthcare and Insurance Premiums
The Act led to the introduction of subsidies on insurance covers to enable the low-income earners to afford the services. The law also stabilized the premium costs by prohibiting price discrimination or hiking of the payments, which did not negatively affect the quality of medical services. The law also introduced a variety of insurance packages that included the platinum, gold, silver, and bronze. All of them offer the same services but on different premiums. However, the federal budget was stressed by the subsidies as the spending on healthcare increased. The need for various programs and projects in the healthcare sector also increased the federal financial needs, as all of them require money to ensure that the services are run as intended.
Reduction in the Number of the Uninsured People
Through the Medicaid, insurance exchanges as well as other public insurance programs, businesses as well as individuals are enabled to access the health insurance plans, which makes it easy for everyone to purchase the covers. The Congressional Budget Office expressed optimism that the policy would reduce the number of the uninsured people by 23 million from the year 2010 t0 2019 and raise the number of the insured people from 83-94% (Pecquet, 2012). The act improves the peoples lives health wise and minimizes bankruptcies that result from high medical bills. The Act further secures children by including them in their guardians health cover until they attain the age of 26.
Changes on the Insurance Standards
The Act set up the standards to be followed by the insurance providers with an aim of protecting the people. The abandonment of clients during sickness was prohibited by the law; thus, it ensured that patients continued to enjoy the service to the end. The insurance providers were also restrained from discriminating the pricing for applicants based on gender or health conditions and they were employed to extend the parents insurance covers for their dependents until they reached the age of 26. The scope of medical cover was also widened to include the essential health benefits, namely ambulance services, hospitalization, mental health, rehabilitation from drug addiction, maternity care, care for the newborns, and laboratory services among others.
The Employers Mandate
The companies that employ more than 50 workers were compelled to insure all their full time workers or pay a fine instead. The provision of insurance in work places helps to attract potential employees as well as boosting the morale of the already employed and thus promoting productivity of labor in the firms. The law, however, did not alter the already existing health insurance plans as it was aimed at addressing the issues that seemed to be neglected as well as helping the disadvantaged people.
The Inclusion of Contraceptives
The bill cares for womens health especially for maternal issues that makes them vulnerable and thus it called for intensified preventive care and screening. The issue of contraceptives, however, attracts controversy by some religious groups as well as advocacy groups that oppose contraception as well as sterilization. The Act, however, does not compel people to use contraceptives; thus, freedom of choice is allowed in this case.
Negative Perceptions of the Act
It was rumored that the act would lead to the discrimination of the elderly and sickly by denying them medical care, and many people believed the hearsay. A study conducted in 2012 found out that 39% of the Americans believed that the claim was true (Viebeck, 2012) and that the elderly people would be denied insurance services and be advised to terminate their lives. People also thought that the Congressmen had been exempted from the policy and that the law would provide insurance for illegal immigrants but the claims were refuted.
Legal Battles over the Issue
A number of stakeholders sued against the Act in federal courts as well as the Supreme Court. An example of the case is the National Federation of Independent Businesses v. Sebellius whereby the legality of the individual mandate was challenged but the Supreme Court upheld the provision. The court, however, gave the states freedom to opt for or against the Medicaid expansion and concluded that the federal government should continue giving funds to the states. A number of cases on contraception and sterilization remain in court with decisions pending.
The law traces back to the year 1989 when the Conservative Heritage Foundation proposed health reforms. Several other proposals followed and they were futile but they laid the foundation for the Obama care. The law is very crucial as it calls for subsidization of health care insurance, provides for the guaranteed issue, minimum standards for insurers, individual as well as the employers mandate that helps to increase the number of insured people. The law reformed the health sector and brought changes such as reduction in the insurance costs and the increase of the insured population among others. However, the Act attracted controversy as it was opposed by some business organizations and advocacy groups. Religious groups also criticize the issue of contraceptives and sterilization although it was not made compulsory. There also exist misconceptions of the law as people feel that it might deny the sickly and the elderly the medical care that they deserve, while others think that the rule has never been applied to the Congressmen and that it provided insurance to the illegal immigrants. However, despite the challenges, the law is very important as it has led to the subsidization of medical costs and increased the number of the insured people as well as tamed the rogue insurance providers and considered the plight of children and adults below 26 years.
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Viebeck, E. (2012, September 26. Poll: Four in 10 believe in Obama Healthcare Law 'death panels'. The Hill. Retrieved from http://thehill.com/policy/healthcare/258753-poll-four-in-10-believe-in-health-law-death-panels