Running head: AFFORDABLE CARE ACT 1

HCS 410- Community Health Organization and Administration

Project Assignment #2 – Affordable Care Act

Dr. Ballantyne

Gina Leymeister

Alvernia University

AFFORDABLE CARE ACT 2

Abstract

The Affordable Care Act has many flaws within its piece of legislation. The objective of

the Affordable Care Act is to insure more of the population while reducing the total cost

of healthcare in America. This piece of legislation has yet to reach both desired goals. By

analyzing the reforms that are necessary to ensure that the population has health care

coverage, many solutions can be discovered. However, the solutions need power behind

them to become implemented. By identifying the deficiencies of the Affordable Care Act,

one can begin to find achievable solutions.

Keywords: Affordable Care Act, The United States, goals, solution, cost

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Affordable Care Act

On March 23, 2010, the Affordable Care Act (ACA) was signed into effect by

President Obama. The Affordable Care Act covers 16.4 million people who would not

have coverage before this piece of legislation. There were many key events and

provisions that lead to the creation of the ACA. The legislation has many goals, but two

of the goals are to increase the number of those uninsured while reducing the money

spent on healthcare. However, it is not evident given the current statistics, that the United

States has achieved either of the two goals listed prior. Like any piece of legislation, there

are deficiency’s that are prevalent (History of the Affordable Care Act (ACA)).

One of the main deficiencies of the Affordable Care Act is that if one does not have

healthcare then he or she has to pay a fine for not being covered. If an individual does not

want to enroll in a healthcare plan, then one is affected by being charged a fee at the end

of the year. The fee that one has to pay depends on one’s household size, income, and

other subjective circumstances. This deficiency is contrary to the main goal of the

Affordable Care Act (Cutting Health Care Costs).

The goal of the Affordable Care Act is to ensure that all citizens have healthcare

coverage. Therefore, the fine is meant to discourage a person to not have insurance, but at

the same time, is not encouraging the access to healthcare. Many who chose not to enroll

in a healthcare plan, decide to pay the fee because to the individual it is more cost

efficient. However, many do not choose to not have coverage, but fall into a “coverage

gap”. The coverage gap includes all individuals that make more than the poverty line or

the 138th percentile and are not entitled to Medicaid. In addition, the coverage gap also

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includes those who are not age 65 or older for the Medicare program. Therefore, this

leaves 23 million persons still uninsured (History of the Affordable Care Act (ACA)).

A solution to this problem would entail creating a program funded by the state that

would insure those who fall into the coverage gap. The program would run like Medicaid

with an entitlement purpose, but would cover the individuals until one can afford a plan

in the private insurance market. However, to protect the misuse of the program each

individual will have to meet with a representative of the program yearly to insure that the

use of the program is still needed for the family or individual. In addition, the cost of this

program will increase the cost spent on healthcare, but at the same time reduce the cost.

Therefore, there will be no loss or gain on the money spent in the healthcare system.

The money spent on healthcare in The United States does not justify the number of

those still uninsured, procedures that are not top quality, and numerous underpaid

professionals. In general, The United States spends $8,745 per capita every year, whereas

other countries spend on average $3,484 per capita. The Gross Domestic Product (GDP)

of the United States expenditure is 17.6 percent. America spends more than any other

country on healthcare without having the best quality of care (Deficit-Reducing Health

Care Reform).

There are two reasons that America has an increase in expenditures compared to other

countries. One stems from the medical technology, and the other fragmented health

insurance that does not have a set price. The United States is more advanced in

technology than most countries but does not have a cost-effective way of delivering

healthcare. Health insurance drives the price of healthcare to be higher since there are

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different rates that can be set for health insurance coverage (Key Facts about the

Uninsured Population).

According to the New England Journal of Medicine, national health spending is

projected to continue to grow faster than the economy, increasing from 18 percent of the

economy to about 25 percent by 2037 (Cutting Health Care Costs). In addition, even with

the new law, federal health spending is projected to increase from 25 percent of total

federal spending to about 40 percent by 2037 (Cutting Health Care Costs). The statistics

listed prior are eye opening to the reader to understand the importance of cost controlling,

which the Affordable Care Act has attempted to implement, but has not succeeded

(Cutting Health Care Costs).

However, there is a center that focuses on the control of healthcare costs. This center

is called The Center for American Progress. The Center for American Progress has

leading health policy experts that include current and former federal and state officials,

executives of health insurers and hospital systems, physicians, and economists. The main

focus of The Center for American Progress is to develop bold and innovative solutions to

contain health care costs. Their recommendations are in agreeance with the author to

offer a suitable solution to control health care expenditure (Cutting Health Care Costs).

This first solution is to promote privately negotiated payment rates within global

spending targets. This would entail payers and providers negotiating payment rates that

would be suitable for all payers and providers in that particular state. If there was a

universal fixed rate, then the cost would decrease in the area of payment rates. The

privately negotiated rates would have to fit within a global spending target for both the

public and the private payers in the state. The only difficult aspect of this solution would

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be the agreement of the fixed rate-spending target. However, this rate could be within a

range, so that there can be a medium rate, but no rate could exceed a given amount

(Cutting Health Care Costs).

In addition, instead of paying a fee for each service, physicians and hospitals should

receive a fixed amount for a bundle of services. This could be titled bundled payments.

The Center for American Progress projected that within 10 years; Medicare and Medicaid

should base at least 75 percent of the payments on alternatives for fee-for-service

payment (Cutting Health Care Costs).

Moreover, in order to control the cost of materials and supplies that are needed for

medical care, the government should not be the one to set the prices for the material. The

manufacturers and suppliers should compete to offer the lowest price. The market-based

prices should then be extended to all federal health programs. This would in turn reduce

the overall cost, but increase the revenue for medical supplies and materials. The experts

in regulating the economy and analyzing the budget agree that action needs to be taken to

control health care expenditure. According to Ezekiel Emmanuel, who is a senior fellow

for The Center for American Progress,

"Ever-rising health care costs reduce middle-class families' take-home pay and threaten

America's standing in the world. These proposals would build on the health

reform law to dramatically improve our health care system. As Congress looks to

cut the budget— and health care spending in particular—these proposals offer a

roadmap that can transform the system and produce substantial savings."

(Cutting Health Care Costs)

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The quote above describes what the increase in health care costs is creating in the

economy. The middle-class families are falling into the coverage gap, and are being

neglected in the system. The Affordable Care Act has reached millions with coverage but

has not figured out a promising way to insure the coverage of those who fall into the gap.

The author thinks that it is vital to control cost while increasing coverage. The goals of

insuring the uninsured and controlling cost are two goals that should be achieved

together. By achieving the goals, it will create an efficient health care system with cost

control (Key Facts about the Uninsured Population).

The time span in order to achieve these goals will be determined by which president

will be willing to carry out the reforms that are necessary. The United States needs to

focus on accomplishing reforming the healthcare system, but at the same time reducing or

maintain the same cost expenditure. If the solutions mentioned previously are achieved,

then The United States may increase in rank from 37th, instead of decreasing from 37th.

The Affordable Care Act is effective by covering millions who are not insured, but it

is not effective by ignoring the issue of spending more per capita than other country and

having the lowest life expectancy rate. This piece of legislation has its benefits and its

flaws by benefiting everyone as a whole, but then leaving others having to qualify for

other benefits.

In conclusion, there is a quote by Andy Stern, who is also a senior fellow at The Center

for American Progress that sums up the reform that needs to take place to save America’s

healthcare system. Andy stated,

“The passage of the Affordable Care Act was not the last step in the push to reform our

health care system. If Team USA is to succeed in the 21st century, we need to

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continue to reform the health care sector to lower costs and increase efficiency,

while also raising the quality of care. Health care reform, as detailed in this report,

can be the engine that puts our country back on track”(Cutting Health Care

Costs).

The author agrees that the ACA was not the last step; therefore reform needs to start now.

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References

Cutting Health Care Costs. (2012, August 2). Retrieved from

https://www.americanprogress.org/issues/healthcare/news/2012/08/02/11970/

cutting-health-care-costs/

Deficit-Reducing Health Care Reform. Retrieved from

https://www.whitehouse.gov/economy/reform/deficit-reducing-health-care-reform

History of the Affordable Care Act (ACA). (2014, October 22). Retrieved from

https://www.ehealthinsurance.com/resource-center/affordable-care-act/history-

timeline-affordable-care-act-aca

Key Facts about the Uninsured Population. (2012, October 5). Retrieved from

http://kff.org/uninsured/fact-sheet/key-facts-about-the-uninsured-population/

Sorum, Paul (Dr.) The Flaws in the "Affordable" Care Act and How to Remedy Them.

Retrieved from http://www.pnhp.org/news/2011/october/the-flaws-in-

the-“affordable”-care-act-and-how-to-remedy-them