Low Cost Health Insurance

All that you need to know about the healthcare law

It is nine years since the ACA or, to give its full name and intent, the Patient Protection and Affordable Care Act came into effect. Millions of American citizens have benefitted but the Medicare and Medicaid programs which preceded it’s cost $676 billion (approximately 10%of the budget). By 2020 the cost is forecast to have doubled.

  • How can we control the ever-soaring expense of increasingly sophisticated treatments?
  •  How should we balance the cost of service between the individual and the state?
  • How do we divide our resources between ‘prevention’ and ‘cure’?

But first some history!

The roots of the idea that the burden of care for the sick and the elderly should be shared are timeless.  But families, politicians, still debated, and lawyers argue about who should pay for what.

Our favorite westerns star ‘Doc’ whose patients were charged on a ‘fee-for-service’ basis and a cheerful ‘don’t worry, pay me when you can!’

Almost exactly 80 years ago Dr. Michael Shadid started a rural farmers’ cooperative health plan (Elk City, Oklahoma 1929). Members paid a predetermined (pre-paid) fee and Dr. Shahid cared for his patients.

At about the same time, during the Great Depression, hospitals persuaded state legislatures to legalize insurance schemes that eventually became known as the Blue Cross (later Blue Shield). They were created as non-profit, provider-oriented insurance organizations. “Provider-oriented” meant that Blue Cross did not tell physicians how to practice medicine. Physicians were free to practice as they saw fit. Insurers (the ‘risk carriers’) would pay the bill on a fee-for-service basis.

Now let’s set today’s legal debates in context.

Throughout the fifties and sixties, concerned parties from all sides sought to find an approach which would optimize both the quality and extent of health and medical care.

Then, as now, the debates centered on issues of: –

  • Cost containment
  • Coverage for the uninsured
  • Access to services for the poorest
  • Consumer rights
  • Efficient delivery systems

By the seventies, legislators and planners became more and more conscious of three disproportionately significant factors: –

  • An aging population
  • The cost of medical treatments
  • Increasing drug dependency (prescribed or otherwise).

It is now almost 40 years since President Nixon announced a ‘new national health strategy’.  The HMO Act of 1973 (Health Maintenance Organization) which endorsed pre-paid health plans for enrolled members who received care from a designated provider network.  Significantly, employers were quick to recognize the value of these plans as a high-quality form of health insurance. They were both a financial incentive to attract skilled staff and contributed to a significant reduction in ‘lost’ working days.

Now we have the

Patient Protection and Affordable Care Act.

The intent of the ‘ACA’ was to reflect the eight topics described above and to place more emphasis on the value of ‘prevention’ before ‘cure’.

We all love the word ‘FREE’ and with ACA came

FREE birth control, mammograms and cholesterol tests are among the ten essential benefits of all health care plans and most importantly for many, the act prevents insurers from turning away or charging more to those with pre-existing conditions.

The act has meant lower premiums, deductibles and cost-sharing for the roughly 60 million senior citizens and disabled Americans enrolled in the program.

It has been estimated that the typical Medicare beneficiary pays about $700 less in premiums and cost-sharing thanks to the Affordable Care Act.

The Affordable Care Act requires insurers to cover people with pre-existing conditions and bans them from charging more to those with pre-existing conditions.

The Act ended the practice of insurers imposing annual or lifetime caps on benefits, and it also placed limits on annual out-of-pocket spending. This has since been amended.

It mandates that insurers provide more comprehensive benefits, including medication, maternity, and mental health. It prevents insurers from charging women more and restricts premiums for older folks to no more than three times those of young adults.

Health Insurance Exchanges

The ACA recognized the need for a controlled but competitive market to deliver the healthcare demanded by the American public.

Health insurance exchanges to allow American citizens to shop for individual policies under open market conditions. The act introduced federal subsidies to ensure that low and moderate-income families could buy policies for less than 10% of their income. The act also limits the deductibles and co-payments for lower-income policyholders.

More than anything else the Affordable Care Act introduced the elements of competition and choice to the provision of Healthcare.  The ACA determines the services demanded and gives, Federal, State or Private Exchanges the freedom to accommodate individual/family needs.

ACA is still the healthcare law of the land.

Will the ACA survive? That is impossible to say. It will depend on the structure of the legislature after the 2020 elections.

As of now, ‘OPEN ENROLLMENT’(November 1st-December 15th 2019) is your opportunity to establish the health insurance you need for you and your dependents for 2020.