New York Times - March 23, 2013
Report Card on Health Care Reform
By THE EDITORIAL BOARD
Republican leaders in Congress regularly denounce the 2010 Affordable Care Act and vow to block money to carry it out or even to repeal it. Those political attacks ignore the considerable benefits delivered to millions of people since the law’s enactment three years ago Saturday. The main elements of the law do not kick in until Jan. 1, 2014, when many millions of uninsured people will gain coverage. Yet it has already thrown a lifeline to people at high risk of losing insurance or being uninsured, including young adults and people with chronic health problems, and it has made a start toward reforming the costly, dysfunctional American health care system.
EXPANDING COVERAGE Starting in 2010, all insurers and employers that offer dependent coverage were required to offer coverage to dependent children up to age 26. An estimated 6.6 million people ages 19 through 25 have been able to stay on or join their parents’ plans as result, with more than 3 million previously uninsured young adults getting health insurance. The law requires private health insurers to provide free preventive care, without co-pays or deductibles. Some 71 million Americans have received at least one free preventive service, like a mammogram or a flu shot, and an additional 34 million older Americans got free preventive services in 2012 under Medicare.
Private insurers are now required to cover children with pre-existing conditions, which means that an estimated 17 million such children have been protected against being uninsured.
And more than 107,000 adults have enrolled in a federally run insurance plan for people with pre-existing conditions. The law also bars insurers from canceling policies on sick people; previously, 10,000 people a year had their policies rescinded.
The law appropriated $11 billion over five years to build and operate community health centers, a major factor in increasing the annual number of patients served to 21 million, a rise of 3 million from previous levels. Some $5 billion has been put into a reinsurance program that has encouraged employers to retain coverage for retirees and their families; 19 million people benefited with reduced premiums or cost-sharing.
SAVING CONSUMERS MONEY Private insurers are required by the law to spend at least 80 to 85 percent of their premium revenues on medical claims or quality improvements, or they must pay a rebate to consumers. In 2012, insurers had to pay $1.1 billion in rebates, an average of $151 per family. Although Republicans contend the law will drive up insurance premiums, thus far it seems to have reduced them. Any insurer that wants to increase its premiums by 10 percent or more for people who buy their own policies must justify the increase to state or federal officials. As a result, the proportion of rate filings that sought increases of 10 percent or more fell from 75 percent in 2010 to 34 percent in 2012, and it is expected to be even lower this year. The average premium increase in 2012 was 30 percent lower than in 2010.
The law also provides for prescription drug discounts to Medicare beneficiaries. More than 6.3 million older or disabled people have already saved more than $6.1 billion on prescription drugs since 2010 and will save even more as a gap in coverage, known as the doughnut hole, is filled in by 2020. And the law ended lifetime dollar limits on services covered by private plans, a matter of great importance to people with very high medical costs. Annual limits on what plans will pay are being phased out.
REINING IN HEALTH CARE COSTS Sharp declines in the annual growth rate in overall health care spending and in Medicare’s cost per beneficiary have eased the pressure on federal budgets and on private insurance premiums. The main factor was presumably the recession, which made people reluctant to spend on health care, but it is possible that the focus on reform has led many providers to act more frugally. The law has reduced unjustified overpayments to private Medicare Advantage plans, which enroll more than a fifth of all beneficiaries, and despite fears to the contrary, Medicare Advantage premiums have fallen by 10 percent and enrollment has risen by 28 percent since the law was passed.
BETTER QUALITY OF CARE One of the most promising aspects of the health reform act is its focus on improving quality. The percentage of Medicare patients requiring readmission to the hospital within 30 days of discharge dropped from an average of 19 percent over the past five years to 17.8 percent in the last half of 2012, an improvement due in large part to penalties imposed by Medicare for poor performance and financial incentives paid by Medicare to providers to encourage better coordination of care after a patient leaves the hospital.
A number of pilot programs in Medicare and Medicaid have been started to reward quality, to encourage doctors and hospitals to coordinate care, and to lower costs. If enough of these experiments pan out, they could transform not only Medicare but the entire health care system.
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