The recent announcement that the White House will delay enforcement of the employer mandate until 2015 has stirred a polemic argument among the American public about the reality and stability of the Affordable Care Act (ACA) – and this isn’t the first roadblock the new legislation has faced, nor will it be the last.
Since its passage in 2010, the healthcare reform bill has been altered significantly, in addition to the recent delay of the Employer Mandate. The following is a list of some of the major changes (many are not listed here):
- The first Obamacare provision to be fully repealed was the 1099 reporting requirement that forced business to report all healthcare transactions valued more than $600 to the IRS.
- The CLASS act, an ACA program for long-term care, was formally repealed in 2012 because it would dramatically increase the national deficit.
- The Department of Health and Human Services delayed the program known as the Basic Health Plan that would allow states to create a scaled down plan for those who do not quality for Medicaid but cannot pay for expensive private insurance.
- In February of 2013 the Pre-Existing Conditions Plan, offering health coverage to currently sick patients waiting for full implementation of the ACA, was suspended indefinitely due to unexpectedly high cost.
- In April, implementation of part of the Small Business Exchange (SHOP) that allows employees to select from a range of plans was pushed back until 2015.
If Obamacare is as wonderful as everyone seems to think, why then is the government continually manipulating it, delaying some original provisions and repealing others altogether? Why has the system proven to be so impossible to implement?
The answer to this question is a complicated web of issues related to the economy, public opinion, policy and regulation, and the general complexities of the healthcare system. For the most part, the new healthcare law is being dismantled because provisions prove to be either impossible to implement as they are written into law or financially irresponsible. There are also underlying application problems due to an array of oversights.
One of the biggest threats to implementation are enrollment complications. This presents a significant issue for Obamacare because the entire program is at risk if high enrollment numbers are not realized.
In a recent Gallup poll 43% of uninsured Americans reported that they were unaware about the new insurance mandates starting January 1 of 2014. Such a lack of knowledge about, and understanding of, the new healthcare system means education efforts are necessary for participation. But the cost of funding education programs is high, estimated to be upwards of $1 billion in fiscal year 2014 alone, and the funds simply aren’t there.
Once individuals are aware of the reform it becomes a matter of whether or not they are willing to participate. The individual mandate in the ACA requires everyone to purchase health insurance either through the marketplace or, if they qualify, receive it through Medicare. Lack of compliance means being subject to a penalty in the form of a fine. However, a recent American Action Forum poll found that 45% of those already insured would rather pay the penalty than purchase insurance through the Obamacare system in which their premiums are likely to increase, essentially refusing to participate.
Assuming an individual both understands the procedure and has elected to embrace the reform, he or she must register and apply for insurance. This process itself is a daunting one as the 21-page form for applying for subsidies has been compressed into three complicated pages requiring accurate, in depth financial information. Here we encounter another obstacle: payment. 51 million adults in the United States are “unbanked” meaning they do not have a traditional checking or savings account, and the percentage of those who are unbanked is highest in the uninsured population. This is a problem considering most health plans only accept a monthly check or an electronic fund transfer from a checking account, leaving consumers with no way to pay for something that they are legally obliged to buy.
As a result of these enrollment setbacks and other hurdles, there is an additional timing obstacle facing many states and the federal government. The implementation procedure is too complex and daunting to accomplish in the time frame originally provided by the reform law so there is general trend of scaling back and “lowering the bar,” resulting in the delays and repeals the country has been seeing.
The question now remains how much more will the ACA change and what will it look like when it is finally implemented?
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