Tag Archives: uninsured

March 26, 2012 · 4:00 am

Section 1001

Yes, Section 1001 is the first section. Hey – don’t blame me, I didn’t number this crazy thing.

The first four sections of the PPACA are grouped under the title “Immediate Improvements in Health Care Coverage for All Americans”. The first of these sections, section 1001, does several things. In part, it amends a previous document, the Public Health Service Act. This Act, enacted in 1944 with subsequent revisions, essentially created the Department of Health and Human Services. DHHS includes many federal agencies, with the most recognizable being the FDA, the CDC, the NIH, and the biggy, CMS. For those of you unfamiliar with acronym bingo, the first makes sure your meat contains a minimum of rat parts, the second tries to keep Contagion from becoming reality, the third trains scientists, and the last is Medicare and Medicaid.

Rather than changing existing text, the first part of section 1001, of the PPACA adds protections for the consumer of health care. Lifetime limits are removed completely. Annual limits are subject to certain requirements. It does allow annual limits on items that are not considered “essential health benefits”. These, benefits (defined in part 1302(b) of the PPACA, which is about 45 pages later than where we are) include ambulatory patient services, emergency services, hospitalization, maternity and newborn care, mental health and substance abuse treatment, prescription drugs, rehabilitation, lab services, preventative care, chronic disease management, and pediatric care, including dental and vision. I’m not therefore, sure exactly what isn’t essential care – maybe things that are covered under certain plans, like IVF, or elective surgeries, can still have limits. But that’s a heck of a lot of things that are now unlimited.

This part also removes rescission – or the ability of a health insurer to drop you because you are too expensive. The actual rates of rescission are hard to identify. Insurance companies have no incentive, and no compulsion, to publish these rates. As of the passage of PPACA, however, they can only drop you for fraud. They can try really, really hard to find ‘fraud’, but it does mean that there is some burden of proof standard that has to be followed.

Preventative care is the next section. It eliminates cost-sharing (co-pays or deductibles) for several items. Those services recommended, and rated ‘A’ or ‘B’ by the Preventative Task Force. This list is not very long – I’ve included a link here: Task Force Recommendations ; immunizations recommended by the CDC, all preventative care for children recommended by the Health Resources and Services Administration; preventative care for women recommended by the same agency, and not included in those from the Preventative Task Force.  Plans are not prohibited from adding additional services.

Does preventative care save money? Evidence is mixed, with much of it depending on how much health care the people saved through preventative care will consume in the future, and whether or not that care will be more expensive or less.  And preventative care unequivocally saves lives.

Coverage is extended until children turn 26 – without the restrictions of being in school. Given the state of the jobless recovery, this isn’t a bad thing for most people. Presumably this will end up being cost-effective, since those insuranceless 24 year olds will no longer just hoof it to the ER when they get the sniffles.

Then there are a whole list of standards about how information about benefits will be given to the public, including how many pages (no more than 4), what type font (no less than 12), what language (culturally and linguistically appropriate), and content (definitions, exceptions, cost-sharing, examples, minimum essential coverage criteria, contact information). This may be an example of excessive government regulation, but there are sections of the original Public Service Act that dictate what level of radiation you have to use on X-rays, so this is not new for the government.

I originally thought I would try to do one section per day, but this is quite the dense document, so I’m going to take more days per section, as needed, and boy, does 1001 need it.

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March 25, 2012 · 3:54 am

Health Care in America – a brief tutorial

Let’s start with some background. Why did we even need health care reform? What was driving the passage of this legislation? What does health care in American look like?

Health care in the U.S. is a patchwork of different institutions, at different times in a person’s life. Children are usually covered under their parent’s health insurance, if their parents have it, or a child-only policy. As with all health insurance the benefits of these policies can vary widely. Before PPACA, many of these policies would have both annual and lifetime caps.

If a child’s parents cannot afford health care insurance, either through work, if it is offered, or individually, states have lower-income health insurance plans that are available for small premiums, typically called CHIP or SCHIP plans. These plans are intended to cover those families that are not eligible for Medicaid.

When a child is from a family that meets the low-income and other qualifications for Medicaid, then they are eligible for this program, which is jointly funded by the federal government and the states.

Even with all of these programs, 11% of the nation’s children were uninsured in 2010.

In 2010, most insurance plans allowed children to stay on their parent’s insurance until they were 19, or 23 if they were enrolled in college. After that, you were responsible for your own health insurance. Most adults who have health insurance have it through their employer. There were no laws requiring employers to offer health insurance. The prevalence of employer-based health insurance arose during WWII, when wages were restricted. As any economist would tell you, this lead to non-wage offerings in order to entice workers. One of these was the employer paying for some or all of a health insurance policy. This was supported by the tax-deductibility, for the employer only, mind you, of this cost.

If your employer doesn’t choose to offer health insurance you have to either get it independently, which is usually more expensive due to the concept of adverse selection (the fact that people who need insurance are more likely to want to buy it) or go without. In 2010, 16% of the adult population did just that, and had no health insurance.

If you make it to 65, then you are eligible for the social insurance program known as Medicare. This federally run program guarantees medical care for all citizens over the age of 65. As of 2010, this program accounted for 3.6% of GDP. This was about 75% of what US defense spending was in 2010. It was also more than the GDP of all but 19 of the countries in the world. Because this is an age-based system, no person over 65 is technically without health insurance, although they don’t have to use it if they don’t want to.

What does it matter if people are uninsured? When people aren’t insured, they don’t go to the doctor regularly. This can lead to illnesses that are more expensive to treat, resulting in higher bills overall, when they do finally go to the emergency room, where they are required to be treated. It can lead to higher public health costs, as they are sick and continue to work rather than treating illness. It also forces them to spend money on health care that they could be spending on new cars and sweaters, which can lead to lower employment. Plus there’s the human suffering. But that’s harder to put a number on (but we can try!)

So there you have it, the basic motivation for why health care needed reforming, in 600 words or less.

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