The Patient Protection and Affordable Care Act: Trick or Treat

The Patient Protection and Affordable Care Act (“Healthcare Reform”) is a complex law that has multiple components. At the end of the day the subparts are integrated and similar to a line of dominos. One part of the law will impact others. When one domino is removed or fails to fall correctly, the entire law is in jeopardy.

Today, there are two components of the law that are being implemented and having vastly different results. First, Healthcare Reform is focused upon expanding insurance coverage to millions of individuals to reduce the number of uninsured. However, one domino that is a key foundational component of expanding insurance coverage was pulled by the Supreme Court. When the Supreme Court determined that the Medicaid expansion language within the Healthcare Reform Act was unconstitutional, the states were granted discretion to either expand Medicaid eligibility benefits to individuals, who had an annual income of 133% of the federal poverty level or less, or in the alternative to maintain the current state Medicaid eligibility requirements resulting in more uninsured or forcing individuals to purchase insurance through the Health Insurance Exchange. Then, the Health Insurance Exchange domino failed to fall correctly. The Health Insurance Exchange has had a rocky start marred with confusion, hundreds of pages of regulations, and an Internet site that has crashed and impeded insurance enrollment. Moreover, there has been a lack of payors involved in the Health Insurance Exchange which may limit some individual’s choice of insurance options. Enrolling individuals and expanding insurance coverage for this Halloween seems to be a trick.

The other side of Healthcare Reform is focused upon changing the actual delivery of clinical care. Changing how health care is delivered to patients is being driven by changing the reimbursement models. One example is the bundle payment program wherein providers, hospitals and post-acute care facilities work together to receive one payment for all the services rendered to a patient. The concept is that the providers will work together under patient-centered protocols to increase efficiency, reduce the cost, engage the patient and split one lump sum fee among the providers. Likewise, clinical integration models are flourishing. Clinical integration is designed to integrate the health care providers through patient-centered protocols and integrated medical record systems that enable the providers to collect and report data on quality metrics. When providers integrate together to deliver care, providers also agree to accept reduced reimbursement rates in exchange for the potential bonus payments for achieving specific quality benchmarks. Ultimately, the clinical integration, bundled payment programs and other Medicare demonstration programs are driving change in the delivery of care. Coordinated and improved healthcare care is one treat from Healthcare Reform.

When Medicaid expansion is denied or insurance enrollment is impeded, there will be a population of uninsured and providers will be hit twice. First, providers will provide care to the uninsured which may result in reduced or no reimbursement. Then, providers will suffer reduced reimbursement from insured patients. Ultimately, this situation causes an adverse impact on the providers’ financial viability, operations and ability to provide care.

In order to achieve the ultimate goals of expanding insurance coverage, improving patient outcomes and reducing costs, the Healthcare Reform components must work together. Individuals must be able to enroll in insurance programs in an efficient manner to reduce the number of uninsured. Otherwise, if providers are subject to treating a large population of uninsured patients in combination with reduced reimbursement, providers will not be able to operate and implement new clinical models to improve patient outcomes. As Healthcare Reform implementation is being rolled out to the public, there are clearly areas for improvement. It is important to remember that if one part of the process is changed or repealed, then the remainder of the law and the other subparts that are affected by the change also need to be addressed. Balancing the tricks and treats caused by Healthcare Reform must be considered in order to achieve the law’s ultimate goals of reducing costs while improving patient outcomes.

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