One of the main arguments made for passing the Patient Protection and Affordable Care Act was the need to control constantly rising health care insurance premiums. However, the early results are not very promising concerning cost controls, according to a survey by the Kaiser Family Foundation. In their 2011 survey of Employer Health Benefits, Kaiser claims that annual healthcare premiums paid by employers rose 9% since 2010, with the nationwide average premium costs now over $15,000.

There is considerable disagreement over what has gone wrong. Defenders of the new law argue that it is too early to judge the cost restraining effects of the law. Most aspects of the bill do not take effect until two or three years from now, and supporters of the legislation urge critics to withhold judgement until 2014 when the entire law is in effect.

Critics of the legislation claim that the cost increases are actually a reflection of the law’s weaknesses. They point to such provisions as the new requirement under the law that anyone under age 26 who is covered by their parent’s insurance can stay on it if they have no other way to get coverage. . This has added over two million young adults to the family health insurance policies of their parents, an extra expense which leaves insurers with little choice but to raise prices.

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Both sides agree that this latest round of price increases couldn’t be more badly timed. With the economy experiencing slow growth, there is little extra money coming in to absorb the increases. This year’s price hikes come on top of relentless increases throughout the past decade. Cost of family health care plans have risen by 113% since 2001, a rate which most economists consider to be unsustainable.

Republicans and Democrats are sharply divided on what should be done. The Republicans are claiming that government involvement is distorting the healthcare market and that the law is not reformable. Therefore they say the law should be repealed. Democrats complain that the legislation hasn’t had a fair chance to work, not just because it is not yet fully implemented, but also because it lacked a government subsidized “public option” to provide the competition with commercial insurers that would keep costs down.

Others suggest there should be a willingness to fine tune the legislation as problems arise. This may involve scaling back the law in some areas that prove unworkable or too expensive, and expanding and encouraging those aspects that prove successful. In any case one thing is for certain: The Patient Protection and Affordable Care Act will be a subject of heated debate for a long time to come.

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Private health care plans that are responsible for overseeing the care of patients on Medicaid have taken hold of the federal health law provision. This could further complicate the industry boom that is expected in 2014, when sixteen million more patients will be steered toward the program for people with low incomes.

States are being lobbied to create “basic health plans“, which would provide coverage to people who are earning as much as 200% of the federal poverty line. This is close to $22,000 each year for individuals according to the Medicaid-like rules. Already, Medicaid benefits are already expanded through the law to individuals earning $15,000.

Deborah Bachrach is a former director for New York Medicaid who currently offers health policy advice to states for the Manatt, Phelps & Phillips consulting firm. She said, “Medicaid-only plans are looking at the BHP as an opportunity to expand their market position.” Without having to compete with the big name commercial insurers, it is possible for Medicaid plans to bring in higher-earning members.

Cover Low-Wage Workers

Stephen O’Dell, the senior vice president of Molina Healthcare, which is a publicly traded Medicaid insurer, argues that it makes sense to cover low-wage workers who currently do not have insurance through Medicaid-like plans, as opposed to commercial insurance policies.

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A $4 billion company, Molina Healthcare joins small nonprofit plans lobbying California among other states to adopt such a program. The Medicaid program in California has plans to add over two million members starting in 2014. In addition, the BHP could send over seven hundred thousand more people to the potential market for insurers such as these.

O’Dell says, “People would look at it and say, I have to pay more, why would I even want to join. These are not people who have historically been without insurance anyway.”

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In Florida, a federal judge stayed on his ruling against the health care law. This makes it possible for the act to be carried out as the case moves through the Court of Appeal on its way to the Supreme Court.

Making his annoyance with the Obama administration abundantly clear, the judge wanted to hurry the process by conditioning his stay on the pursuit by the Justice Department to expedite an appeal, which by his order must be filed within a minimum of seven days.

What Does Judge Roger Vinson Have To Say?

Judge Roger Vinson of the Federal District Court in Pensacola, Florida, wrote, “The sooner this issue is finally decided by the Supreme Court, the better off the entire nation will be.” He continued by saying, “And yet, it has been more than one month from the entry of my order and judgment and still the defendants have not filed their notice of appeal.”

The stay essentially suspends the judge’s order until the appeals. It somewhat satisfies the confusion that came up following the judge’s ruling in January stating that a central provision of the law is not constitutional and that the rest of the law, including the Affordable Care Act, must go down with it.

Judge Vinson wrote, “It is likely that the Courts of Appeal will also reach divergent results and that, as most court watchers predict, the Supreme Court may eventually split on this issue as well.” He also said, “Despite what partisans for or against the individual mandate might suggest, this litigation presents a question with some strong and compelling arguments on both sides.”

A spokesperson for the Justice Department, Tracy Schmaler said, “We appreciate the court’s recognition of the enormous disruption that would have resulted if implementation of the Affordable Care Act was abruptly halted.”

The Attorney General for the state of Florida, Pam Bondi, who was the lead plaintiff in the case in Pensacola, released a statement saying that she was disappointed with Judge Vinson’s stay, but that his determination for a speedy appeal makes sure “that there will be no more stalling from the federal government.”

photo credit: Vectorportal

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