By Roger Bybee
In These Times, Nov. 30, 2011
Health care reform in the shape of the 2010 Affordable Care Act was supposed to relieve working Americans of the burdens of rising health care costs as they struggle to survive the jobless recovery.
Instead, working Americans are being confronted with a profound deterioration in the health care system and the emergence of a disastrous new stage in America’s downward slide on health care.
“‘Unaffordable under-insurance’ is rapidly becoming the new standard in the United States,” Dr. Don McCanne, senior health policy fellow for Physicians for a National Health Program, told workinginthesetimes.com.
BIG SYMPTOM: 17% DROP IN VISITS TO DOCTOR
One of the most telling symptoms of the “new normal”: visits to physicians’ office have dropped a stunning 17 percent from the second quarter of 2009 to the second quarter of 2011, according to a recent Kaiser Family Foundation, McCanne said.
This drop in doctor visits illustrates how the ever-growing burden of health care costs — in the form of out-of-pocket deductibles and co-pays — is making Americans reluctant to seek care despite having the supposed protection of health insurance. “We know that a lot of people are foregoing beneficial treatments for conditions like diabetes, or not getting vital preventive services like Pap smears,” McCanne observed.
SHORT-TERM SAVINGS FOR INSURERS
As people’s health conditions grow in severity because of a lack of care at an early stage, the eventual cost of treatment will be much more costly and the chances of a healthy outcome reduced. With high-deductible insurance plans proliferating among pattern-setting large employers like General Electric, this pattern of unaffordable under-insurance will be well-established by the time that the Affordable Care Act is fully implemented in 2014 with health care exchanges created at the state level.
According to Dr. McCanne, the various levels of coverage offered under the ACA will leave working families with the same problem of increasingly skimpy insurance coverage that is too expensive to actually utilize. “The ‘bronze’ plan will have an ‘actuarial value’ of 60 percent, meaning that people will be paying 40 percent of their health care costs,” said McCanne.
FAMILIES CAN’T AFFORD 40% OF THEIR HEALTH COSTS
Government subsidies and maximums on out-of-pocket costs will provide some assistance, but it still appears that the bronze plan will mean that consumers pay about 40 percent, he stated. The “silver” plan covers 70 percent [i.e. does not cover 30 percent] of health care costs, but the premiums will be higher, and most consumers will probably be drawn to bronze plan. But there is little likelihood that health care insurance premiums will remain stable under the bronze plan or any other option under ACA.
Even with usage of insurance declining, fueling huge profits, insurers in California and elsewhere have been jacking up premiums, noted McCanne.
Given the vast imbalance between workers and capital, corporations have been able to force workers to swallow the premium increases, with workers’ share of health care costs rising 63 percent between 2003 and 2007. With no effective cost controls contained in the Affordable Care Act — which, after all, was drafted by WellPoint insurance lobbyist Liz Fowler working alongside the insurers’ pet poodle Senate Finance Chair Max Baucus (D-Montana) — the problem of “unaffordable under-insurance” is only going to snowball as we head toward the era of “reform.”
DISAPPOINTING RESULTS FOR ACA THUS FAR
While the ACA has raised hopes that some of the worst abuses of the for-profit insurance industry will be curbed, McCanne and his colleagues at the PNHP caution that insurers are likely to easily circumvent regulations and that the ACA will be able to keep health care affordable.
For example, the ACA’s program for people with pre-existing conditions has enrolled a mere fraction of those expected to sign up, as insurance remains prohibitively expensive.
SYSTEM LIKELY TO BE MORE STRATIFIED BY INCOME
Overall, McCanne said, we appear to be headed toward a new health crisis where most people find themselves among the ranks of the “unaffordable under-insured” and health care is increasingly delivered in a rigidly-tiered system based on ability to pay.
Poor people depending on Medicaid will be especially hard-hit as the new breed of conservative governors exemplified by Wisconsin’s Scott Walker slash the Medicare rolls while increasing corporate tax breaks. The limitations of ACA-style reform – which which the Obama Administration chose to build around the mammoth and unproductive bureaucracy of the for-profit insurance industry – are becoming increasingly apparent. As PNHP leaders pointed out after the passage of the ACA, “The much-vaunted insurance regulations – e.g. ending denials on the basis of pre-existing conditions – are riddled with loopholes, thanks to the central role that insurers played in crafting the legislation. “
ACA’S OVER-TOUTED FEATURES
Some of the most highly-touted features of the ACA features contain built-in problems, they noted. For example, “Older people can be charged up to three times more than their younger counterparts, and large companies with a predominantly female workforce can be charged higher gender-based rates at least until 2017.”
Moreover, “About 23 million people will remain uninsured nine years” into ACA’s existence.
At the same time, the affordability and coverage of those with insurance will continue to deteriorate – until the bottom 99 percent start to rebel against a health system shaped to maximize the profits of insurers who seek to minimize care. The Occupy movement offers a hopeful sign that Americans are recognizing that the health care system, like other U.S. institutions, functions to benefit the top 1 percent at the expense of the vast majority, McCanne said.
For Dr. McCanne and fellow health professionals in Physicians For a National Health Program, the downward spiral in health care will finally end only with the U.S. installing a Canadian-style “Medicare for all” single-payer system that puts a halt to the machinations of for-profit insurers.
Clarification by Don McCanne: It is correct that the actuarial value of the bronze plans offered by the state exchanges is 60 percent, meaning that the insurer does not pay for 40 percent of the allowed costs. For those with incomes under 400 percent of the federal poverty level, cost sharing subsidies are provided, indexed to income. Also, there is an annual limitation on the total amount of cost sharing for benefits covered by the exchange plans (based on coverage requirements for health savings accounts).
What is not included are any health care services and products that are not specified in the plan as covered benefits. Also, any services that are received from providers outside of the plan networks may be excluded. These omissions can result in very high additional costs for which the patient is 100 percent responsible. An example might be a $100,000 cancer drug that the insurer conveniently labels as “experimental” and therefore not covered. Non-covered and out-of-network services can easily result in the patient having to pay 40 percent or more of the total health care bill.
