Obamacare: The Good, The Bad and the Trojan Horse

A bird’s eye view of the medical regulatory landscape since the late 1700s reveals  skirmishes and battles over physician qualifications,  education standards, hospital and physician accreditations, medical ethics, drug and device development  and,  last but not least,  payment mechanisms.  From a distance we also see a steady march toward a centralized bureaucracy administering all aspects of health care– standards, regulations, choices, availability of services, payment methods and more. The latest steps came in  2010, when,  after a contentious battle,  one party of Congress passed the massive Patient Protection and Affordable Care Act, also known as the PPACA, the ACA or Obamacare.

Some good

During the legislative haggling over the ACA, the House Speaker famously said that we had to pass the law to see what was in it and after six years, some things are clear.  We can no longer be denied insurance because of pre-existing conditions and there can be no cap on payments over time.  Some people are buying insurance for the first time because they can receive federal subsidies that make premiums more affordable.  Medicaid has been widely expanded and made available for many whose incomes had made qualification impossible before.  The number of people who are uninsured has fallen back to 13-14% -the best since the 1990s.

Some not so good

The law improves access to healthcare via additions to the labyrinthine system in which costs remain invisible to doctors and patients and the largest profits go to hospitals and insurance companies. For many people, insurance costs and out of pocket deductibles are now higher and choices of doctors and hospitals reduced.  Carrying health insurance is a new legal requirement and our policies must include services we don’t need (such as maternity care).  Breaking the law means paying a tax penalty of up to 1% in the initial years after passage, more in years to come.  And of course there are innumerable rules.

A failure to address costs

Despite clamor for reform because of the outrageous prices attached to medical care, the legislators crafted a law that addresses medical costs only by increasing taxes and threatening funding.  The 2700 page ACA includes new taxes on investment income and on medical devices, fees to be paid by drug companies, new taxes on every Medicare and private insurance company policy, as well as additional policy fees that finance an independent and unaccountable organization dedicated to clinical effectiveness research. Insurance companies must pay fees to sell their policies on the health care exchanges. Half of the law’s estimated $1 trillion cost will come from cuts in Medicare spending, pain not yet felt.

The Trojan Horse

Most noteworthy for those readers concerned about the long term effects of the ACA  is a new agency called the Independent Payment Advisory Board (IPAB), composed of 15 people chosen by the President, serving 6-12 years, but able to stay in their posts indefinitely if the President chooses not to replace them.  The controversy spawned by the stunning powers granted to this board and the fact that the President has yet to appoint any members to it have convinced many that the board will never be functional. Nevertheless, IPAB is a Trojan horse inside the city’s gates.  Should it come to life, the process of herding everyone into a bureaucratically controlled healthcare system will be easy to complete.

Getting around democratic messiness

The Independent Payment Advisory Board is deliberately designed to get around the messiness of democracy and the reluctance of politicians to act responsibly when they risk unpopularity. For instance, for over a decade Congress repeatedly blocked the cuts that current legal formulas demand in Medicare reimbursements to doctors because the cuts were too onerous. They also feared the effects of Medicare cuts on the private sector, where payments are tied to the Medicare schedule. The ACA removes political considerations from efforts to control costs by handing the problem to the IPAB, which then inverts the normal process of legislation and effectively ties the hands of Congress, the President and the courts. IPAB’s recommendations will be presented as completed legislation that must be enacted unchanged unless the President  and three-fifths  of both Senate and House of Representatives reject the proposal and present an one that cuts spending equally. IPAB’s proposals, once implemented, cannot be subject to judicial review.

No oversight

The Board’s proposals are exempt from administrative responsibilities such as citizen review and must be must crafted yearly if projected Medicare expenditures per enrollee are determined to exceed a predetermined figure. Growth projections regularly exceeded the trigger point up until the law was enacted in 2010.  The sudden, unexpected decline in projections since ACA enactment is not understood, but it took the negative spotlight off the advisory board for the time being.

Handing the power of healthcare cost allocation to one, unelected individual

Should Medicare cost projections balloon before the President has appointed IPAB members, the ACA allows the Health and Human Services Secretary to assume the responsibilities of the board – making it possible that one unelected individual could decide how to allocate healthcare resources. The President’s executive discretionary power is forbidden in this situation. He is not allowed to shelve the Secretary’s proposal and must present it to Congress within two days.

Perpetual  life for the IPAB

Congress’s only way to repeal IPAB is to present a bipartisan proposal created between Jan. 1 and Feb. 1, 2017 (about 15 working days in the midst of the start of a new presidency) and then to get the proposal approved by three-fifths of  Senate and House members  by August 15, 2017. If the attempted repeal fails, no Congress may ever again attempt to repeal the Board.  After 2020 Congress may never enact substitutes for the proposals the board makes about healthcare payments.

At present, most people seem less concerned about the potential for unconstitutional government action than about the practicalities of getting insurance under a law that seems here to stay unless it is repealed in toto. While many people might welcome continued movement toward a federally administered healthcare system, they should remember that we already have two. One is the Indian Health Service and the other is the  VA. Both have huge problems.

Respond to Obamacare: The Good, The Bad and the Trojan Horse

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