One of my business school professors said that the smart answer to most questions is, “It depends.” I thought that was just a way to buy some time and collect one’s thoughts rather than blurting out the first thing that comes to mind. Although that’s certainly true, the more I have reflected on what he said, the more I have come to understand its validity.
For much of 2012, “It depends” was the answer often given in response to the question of whether the Affordable Care Act (ACA), the law that has become known as Obamacare, would be implemented.
The first answer came with the highly anticipated Supreme Court decision: “It depends on whether the Supreme Court rules the ACA—in particular, the individual mandate—constitutional.” Well, the highest court in the land did rule the individual mandate, which is arguably the cornerstone of the ACA, constitutional, but with a surprising twist—not under the commerce clause, but under the taxing clause.
After the Supreme Court ruling, the next response regarding whether the ACA would survive pertained to electoral hurdles: “It depends on whether President Obama is re-elected and the Democrats retain their majority in the Senate.” Well, both of those events transpired. Thus, the day after the election, in an interview with ABC “World News” anchor Diane Sawyer, Republican Speaker of the House John Boehner famously conceded, “Obamacare is the law of the land.”
Although the ACA is a federal law, per the Supreme Court ruling, the states have a lot of say as to whether and how certain key elements of the ACA are actually implemented. Perhaps most noteworthy is the element related to Medicaid expansion. As of June 14, 2013, 26 states were participating and one state was leaning toward doing so, but 13 states had decided not to participate, six states were leaning toward not participating, and four states were pursuing an alternative model.a
The establishment of health insurance exchanges (or marketplaces, as they are now known) is another area where states are making choices that affect the pace and nature of ACA implementation. As of June 20, 2013, state-based marketplaces were declared by 16 states and the District of Columbia, in keeping with the ACA. Meanwhile, seven states were planning for a state-federal partnership marketplace, and 27 states indicated their intent to default to a federally facilitated marketplace.b
The Enormity of the Healthcare Reform Law
One factor in the ACA’s implementation is its sheer complexity, both in terms of its multidimensional scope and its lengthy, multiyear rollout. It’s easy to forget that the text of the ACA is the combination of two gargantuan pieces of legislation: the ACA (Public Law 111-148) and the Health Care and Education Reconciliation Act (Public Law 111-152)—which totalled, before consolidation, more than 2,400 pages and contained more than 450 sections. Even summarizing the law is a challenge: A recent recap of the ACA by the Kaiser Family Foundation contains some 7,500 words on 13 pages of small print.
Although the ACA may be the law of the land, the Republican-controlled House of Representative has passed more than three dozen votes to repeal the law, and congressional Republicans have maintained a steady drumbeat of charges that the ACA will raise costs and cost jobs.
The Important Role of the Public
Ultimately, actual implementation of much of the ACA will depend on the American public’s compliance with the law, especially in terms of enrollment in healthcare coverage programs by the uninsured and low-income households.
The highly variegated “patchwork quilt” of state participation in the ACA, the complexity and controversial nature of the law, and continued debate on Capitol Hill have led to sharp divisions among the public on the major tenets of the law as well as misconceptions about it. According to the April 2013 Kaiser Health Tracking Poll, 42 percent of Americans were unaware that the ACA was still the law of the land, 12 percent thought the law was repealed by Congress, 7 percent believed it was overturned by the Supreme Court, and 23 percent did not know whether the ACA remained law. Also, about half of the individuals surveyed said they did not have enough information about the healthcare reform law to understand how it will impact their families. Most distressingly, this proportion rises among the uninsured and low-income households, the primary intended beneficiaries of the ACA.c In short, many Americans have only a murky understanding of the healthcare reform law.
In response, in early May 2013, the Obama administration launched a $150 million campaign to try to persuade 7 million people nationwide to enroll for coverage, come October. Thousands of workers will be hired and trained to work in community health centers to help people enroll in health insurance marketplaces. In late June, the administration unveiled a new, consumer-focused HealthCare.gov website and a 24-hour consumer call center dedicated to promotion and facilitation of enrollment in the marketplaces.
A number of controversies involving the Obama administration emerged in mid-May; two, in particular, could adversely impact implementation of the ACA. The IRS’s scrutiny of conservative political groups and The U.S. Department of Health and Human Services (HHS) Secretary Kathleen Sebelius’ fundraising efforts for Enroll America—a not-for-profit organization that seeks to educate Americans about enrolling in healthcare coverage—are both subject to federal investigations. These investigations and their outcomes could hinder HHS’s work in rolling out the healthcare coverage expansion and impact the IRS’s role in enforcing the individual mandate and determining eligibility for health insurance marketplace subsidies.d
Implications for Hospitals and Health Systems
After the passage of the ACA in March 2010, the conventional wisdom was that the coverage expansion would lead to increased demand for services, which would in turn help offset lower payment rates. But the varied ways states are approaching the ACA, the sizable gaps in knowledge about the law by much of the American public, and the fresh controversies in Washington have together cast a dark cloud of uncertainty over the implementation of the healthcare reform law. Combined with the continued weakness of the American economy, which has restrained demand for health care, it is unclear how hospitals will fare over the next couple of years. In the final analysis, “It depends.”
Ken Perez is a healthcare policy and IT consultant in Menlo Park, Calif., and a member of HFMA’s Northern California Chapter.
a. “Where the States Stand—June 14, 2013,” The Advisory Board Company, June 14, 2013.
b. “State Decisions on Health Insurance Exchanges and the Medicaid Expansion, as of June 20, 2013,” Kaiser Family Foundation, June 20, 2013.
c. “Kaiser Health Tracking Poll,” Kaiser Family Foundation, April 2013.
d. Block, J., and Zigmond, J., “Caught in the Whirlwind,” Modern Healthcare, May 20, 2013.
Publication Date: Thursday, August 01, 2013