In what is perhaps the greatest corporate scam ever, not only did the health insurance corporations write the federal health law, called the Affordable Care Act (ACA), to enhance their profits, but now they also have the government and non-profit groups doing the work of marketing their shoddy products. The foundation of the ACA, the mandate that uninsured individuals purchase private insurance if they do not qualify for public insurance, begins in 2014 and the state health insurance exchanges where people can purchase that insurance opened on October 1. A new non-profit organization called Enroll America was created to organize and train grassroots activists to seek out the uninsured (they even provide maps) and assist them in using the exchanges.
Billions of public dollars and tremendous efforts are being spent to create new health insurance markets, advertise them, subsidize their products and actively solicit buyers for them. But the United States, as the only industrialized nation to use a market-based health care system, has already proven over the past 40 years, that this system doesn’t work. It is the most expensive, leaves the most out and leads to poor health outcomes. It means that people only receive the health care they can afford, not what they need.
Market competition does not improve health outcomes because it consists of health insurance corporations competing for profit by selling policies to those who are the healthiest and denying and restricting payment for care. And regulation of insurers doesn’t work either. Although rules in the ACA give the appearance of changing insurance company behavior, insurers are already working around them.
Defense of the ACA ignores the long history of private insurance influence and domination and is based on the hope that this time things will be different. But the ACA has not changed the fact that private insurance companies view their plans as products and have no more allegiance to human health than does Big Energy which will stop at nothing to drill, frack and blow-up the planet for profits.
Experience at the state level with previous similar reforms and a look at current health trends show that the ACA will leave tens of millions without insurance, will increase the percentage of people who are underinsured, will increase financial barriers to necessary care and will further privatize health care. Cutting out the multitudes of insurers and creating a single publicly-financed universal health care system, Medicare for all, is the only way to solve our health care crisis.
The ACA Fails to Solve Our Health Care Crisis
• The ACA leaves tens of millions without coverage. There are currently 48 million uninsured people in the US. At its best, the Congressional Budget Office estimates that the ACA will leave 31 million people without health insurance when it is completely rolled out. And even that estimate may be too low. Experience at the state level showed that none of the similar plans hailed as comprehensive met their coverage goals before they failed due to costs. Without effective cost controls, care remains unaffordable.
• The ACA lowers the bar on what is considered to be acceptable insurance coverage. Plans sold through the new health insurance exchanges will pay for as little as 60 to 70 percent of covered services and carry high out-of-pocket costs. Because subsidies towards the purchase of insurance are inadequate, most people who are currently uninsured will be forced into the low coverage plans.
• The ACA continues the problem of financial barriers to care. Considering that 76 percent of Americans are living paycheck to paycheck without significant savings, the money simply isn’t there to pay the out-of-pocket costs for visits to the doctor, tests or prescriptions. A health survey by the Commonwealth Fund last year found that 80 million people reported not getting care due to cost, 75 million were having difficulty paying medical bills and 4 million (over 2 years) went into bankruptcy as a result.
• The ACA will circumvent the requirement to cover people with pre-existing conditions. One way that insurance companies are doing this is by restricting their networks to avoid places where sick people go such as large medical centers and public hospitals and by limiting the number of providers. This will push people to use out-of-network providers and bear more or all of the cost. Another method will be to raise premiums or stop selling insurance plans in areas where they do not make a profit. Insurers can’t charge more for policies because of pre-existing conditions, but they can charge more based on age and location.
• The ACA allows insurers to receive waivers from provisions in the law. Since the ACA was passed in 2010, insurers and others have received thousands of waivers from the Department of Health and Human Services (HHS) to exempt them from requirements. One of the most recent was to waive the cap on out-of-pocket spending because insurers claimed that their computer systems were not ready to handle the caps. We will watch and see what insurers do over the coming years. We can expect them to justify charging higher premiums and to push for lower levels of coverage or fewer required services. And we can expect that HHS and state insurance commissioners will be compliant, as they have been.
• The ACA moves our health system towards greater privatization. The ACA lacks provisions to stop the consolidation of ownership of health facilities by large for-profit entities, something that large insurers are doing more. It also cuts funding to safety net hospitals and shifts those funds to subsidize private insurance. In Massachusetts where a similar health law was passed in 2006, the need for safety net programs has not fallen as people, even with insurance, face financial barriers to necessary care.
• Under the ACA, public insurances are being privatized. More states are moving their Medicaid patients into managed care organizations (MCOs). MCOS are for-profit administrators that compete with each other to cover the healthiest patients and are incentivized to cut care. Currently 75 percent of Medicaid patients are in MCOs and that number is expected to increase further under the ACA. And one of the early goals of the ACA was to cut back on Medicare Advantage plans which are essentially private insurance plans paid for through Medicare. The Advantage plans primarily insure the healthiest seniors and cost more than traditional Medicare. Instead of cutting back, the Obama Administration boosted payment to the Advantage plans. And enrollment in the plans has increased by 30 percent since 2010.
Not the reform we need
Looking at the ACA from a distance, it is difficult to see it as anything more than a law designed by and for the health industries that profit from the current health system. The regulations can be circumvented or waived. The insurers can continue to find innovative ways to avoid the sick and paying for care. And overall the system is becoming more privatized, which is the opposite direction from the real solution, Medicare for all.
The United States is already spending more per person each year on health care than any other industrialized nation. We are spending enough to provide lifelong high-quality comprehensive care to every person living in the US. If we see the US market-based health care system as an experiment, it has failed and should be ended for ethical reasons.
If we move immediately to a publicly-funded national Medicare for all, there would be no need for insurance exchanges and the massive increase in bureaucracy that goes with them. Every person would be in the health system. Any person who sought care would be covered without requirements for payment before care. Medicare for all is the most effective, most efficient and fastest way to create a health care system that is about health rather than profit. It is also the most just.
We cannot cross our fingers and hope that the ACA ‘works.’ That attitude means hundreds of thousands will suffer and die from preventable causes and millions of families each year will continue to go bankrupt because of medical illness and costs. The moral imperative is to realize that health care never has been and never will be a commodity and to stop treating it as such by taking it out of the marketplace altogether. We need Medicare for all now.
Dr. Margaret Flowers serves as Secretary of Health in the General Welfare Branch of the Green Shadow Cabinet of the United States.