Update on the Patient Protection and Affordable Care Act (PPACA): Good and bad

Update on the Patient Protection and Affordable Care Act (PPACA): Good and bad.

What was the base state before passage of PPACA in 2010?
Before considering the current state of health care after passage of PPACA, it is important to define the “base state”. Fortunately, baseline data are available from the 2010 national census concerning the health insurance status of Americans. According to the 2010 census, 16.3% of Americans had no health insurance, nearly 50 (49.9) million Americans! In 2010, Americans receiving health insurance from government increased slightly from prior years to 31%, 95 million Americans. That same year, Americans covered by employee-based health insurance decreased to 55%, 169 million Americans. These data represent the “base state” from the same year PPACA passed but before implementation. Physicians and scientists know how important it is to have such robust “before” data. As with any new law, there are “good” features that are very popular, and “bad” features that are not so popular.
THE GOOD. Although the naysayers will not admit it, there are very good provisions within PPACA. What are some of them? For a start, the PPACA broadens health insurance coverage for adults with pre-existing conditions and eliminates pre-existing conditions for children. Resolving this “pre-existing conditions” issue is long overdue! In addition, PPACA allows dependent children to remain on parents plan until age 26, an almost universally popular provision. The PPACA also ends rescissions, that is, insurance coverage cannot be cancelled because of a new illness. Now, there is also no lifetime dollar limit on coverage. Finally, the PPACA begins to address closure of the so-called Medicare drug donut hole. All of these changes are very positive improvements for many Americans. Importantly, there are now many more Americans with health insurance than before passage of PPACA—nearly 12 million more! These are some of the most positive changes resulting from implementation of PPACA.
THE BAD. Of course, no law is perfect. If you compare the 2016 census data with the numbers of newly insured Americans, there are at least 35 million Americans still without health insurance. Furthermore, in 2016, the penalty for not having health insurance increases significantly–to the higher of either $625/adult or 2.5% of household incomes. This is a potent penalty for those not complying with the PPACA provisions. According to CMS actuaries, health expenditures increased in 2014. Notably, the costs of hospital care, physicians’ services, prescription drugs and especially insurance premiums have all gone up. BUT the most striking increase is in the cost of government administration for health care—up 5-fold. More recently, from 2015 to 2016 insurance premiums on the ACA exchanges rose on average 9%. In 29 States, the average premium increases were in double digits and in one third of States the average premiums increased 20% or more. In addition to premium increases, there are increases in insurance deductibles. Silver plans, the most popular in the health care exchanges, now have an average deductible of nearly $3000 in 2016. Then there is the performance of the so-called “Obama care exchanges”. Fully 12 of the 23 cooperatives failed and are defunct. Of the remaining 11 cooperatives, 8 are under enhanced federal oversight or are on a corrective action plan. None of this is good news for Americans who counted on the cooperatives as a vehicle to sign up for health insurance. What does all this mean for patients wishing to use their health insurance? Can these patients really afford routine primary care or access to care for management of chronic disease? There are issues also of access to health care. Within PPACA, there was no plan to address the physician workforce, especially the ongoing shortage of primary care providers. For practicing physicians worried about medical malpractice, the PPACA failed to address tort reform in any meaningful way.
So there you have it—the mixed bag that is PPACA, both the good and the bad! Is it possible to keep the good while diminishing the bad? We shall see what the congress and new administration might propose after the elections in November. Stay tuned!

HR 1314, 114th Congressional omnibus spending bill: Something for everyone!

The new year is off to a most positive start with passage of a $1.1 trillion omnibus spending bill by the 114th Congress, and recently signed by the President. This new spending bill increases funding for biomedical research substantially.  Funding for the National Institutes of Health (NIH) will increase by about $2 billion, and the new NIH appropriation will total about $32 billion.  This exceptionally good news is not to be taken lightly.  In 2009, at the beginning of the current administration, the NIH budget was $29.5 billion.  From 2009 to 2015, the NIH budget stagnated, and actually lost ground in terms of inflation-adjusted dollars.  In 2015, the NIH budget was a modest (only by Washington, DC standards) $30.1 billion.  One only need to compare that budget with the 2009 budget to deduce that neither the previous Congresses, nor the current administration, was able to navigate a divisive political atmosphere to continue supporting the country’s critical investment in biomedical research. Fortunately, the 114th Congress gets it!  The current increase is highly positive and ends an unfortunate sustained lack of federal investment in research.  However positive, the current increase is just a beginning, and the Congress and the next administration must embrace the pragmatic need to keep the country’s investments in medical research ongoing and increasing in a predictable manner.  If you recall, HR-6, the 21st Century Cures Act suggested just that.  The 21st Century Cures Act recommended a multi-year, incremental investment in biomedical research funding to put the NIH on more stable footing, with the ability to fund research knowing what the out year budgets might be.  While the 21st Century Cures Act was passed overwhelmingly in the House, it continues to languish in the Senate.

And what about everyone else?

In addition to the increase in the NIH budget to about $32 billion (a 6.6% increase, largest increase in 12 years) other entities supporting medical research also received increased budget appropriations. The NSF will see a 1.6% increase ($119 million) to a new budget of $7.46 billion.  The research appropriation for the VA’s Office of Research and Development will see a 7% increase in its research budget to $631 million, its largest budget ever.  Only the AHRQ will experience a budget decrease, of 8% from $364 million to $334 million, (this could be viewed as progress as HR-6, the 21st Century Cures Act, proposed to terminate all funding for the AHRQ).  Let’s hope that congressional support for further investment in medically focused research continues for the next period of time, providing the academic enterprise, and its research faculty, some stability and the assurance that this most critical academic mission in not again shortchanged or caught up in partisan bickering.  The only remaining concern is that despite being passed by Congress and signed by the President, report language—what the Congress expects the funded departments or agencies to do with the increased revenues from the new budget agreement–is still not available for this Omnibus spending bill.

For additional information, see also news.sciencemag.org 12/18/2015

Coming next: Update on the Patient Protection and Affordable Care Act (PPACA):  Good and bad.