Monday, October 1, 2012

Unaffordable Care Tax

I have avoided writing about the Affordable Care Act aka Obamacare until I felt like I understood it a little bit better. One blog post can hardly do justice to the Act in it's entirety, but here's for starters. The SCOTUS affirmed that the mandate that everyone must purchase health insurance is Constitutional under the ability to tax so I will refer to the Act as the Affordable Care Tax.

The two goals of the ACT are to expand access to coverage and slow healthcare costs which are both laudable endeavors. As part of the plan, there will be no denial of insurance for preexisting conditions, no lifetime caps, covering kids until 26, and even rates for insurance despite medical history. Obviously, there is an increased payout on the part of the insurance companies to meet this requirement that they can't pass on directly to the previously or currently unhealthy individual. This means that insurance rates for everyone will go up in order to pay for those increased costs, right? Anticipating this obvious move, the ACT mandates that insurance companies justify premium rate increases of 10% or more per year starting in September 2012 (never mind the fact that rates skyrocket until then in anticipation). Additionally, if insurance companies do not spend 80% of premium rates on actual healthcare and quality improvement measures, they must refund the difference to the customers. You might wonder why you didn't hear more of a fuss from insurance companies in response to these proposals. To keep insurance companies happy Congress had to throw in the 'individual mandate' - every American citizen is required by law to purchase health insurance or face a fine.

The Affordable Care Tax mandates that insurers can only charge older individuals three times more than they charge young, healthy counterparts. That's a great deal for the elderly who generally pay six times more for healthcare than youngsters and the numbers wash out such that the younger are asked to pay 75% more for insurance so that the elderly can pay 13% less. That isn't so much insurance as it is a subsidy defensible only under the tax clause. 

This mandate, along with the 'justifiable' cap on increasing yearly premium rates, has caused my personal private insurance to jump (before the cap takes effect) from $1450 in 2011 to $1980 (37%) in 2012 for the exact same coverage. Can I subtract the difference on my taxes for next year?

Those who refuse to pay for insurance (either individuals who can't afford it and qualify for expanded Medicare coverage or businesses who decide it's cheaper to pay the fine than pay for insurance) get dumped into the Medicare system. The problem with that is that compensation over the long term goes down for future doctors like me.

This is a chart available from the American Hospital Association demonstrating how the different insurance payouts compare. The horizontal grey bar represents the actual cost to a hospital of providing care for any given patient. As you can see, publicly funded patients do not reimburse hospitals the full amount that it costs to provide treatment. You might point out that hospitals make up the difference on the private insurance patients, but then you realize that there are lots more Medicare and Medicaid patients than there are private insurance patients.

Additionally, the 50% worst performing hospitals in terms of patient satisfaction, 30 day readmission rates, and a few other criteria lose 1% of reimbursements the first year of implementation, 2% the next, and 3% thereafter. This money goes to reward the top 50% of hospitals. Can anyone think of why it might be a bad idea to reward hospitals and doctors based on patient satisfaction? At the basis of any profession is the notion of client advocacy. I am asked to be willing to make a narcotic drug seeker mad and say no to his request for a prescription for oxycodone. A diabetic being treated for hyperosmolar hyperglycemia syndrome whose friend brings her a McDonald's Mcflurry ought to be told she can't have it without worrying whether that will affect reimbursement for her treatment. Smoking cessation has to be documented in each encounter with a smoker regardless of whether he wants to hear me nag or not. A 450 pound male probably needs some frank words. An ER physician might suggest to a 7th time ATV rollover patient that it's time to find a new hobby. I'm absolutely not advocating permission to be rude, belligerent, or insulting, just for the freedom to do what I am trained for: taking care of patients.

The faith in collective social effort required by this piece of legislation is commendable as this article illustrates, but is prohibitively large and therefore naive.

 --I'm very afraid, because I don't think we are making adequate preparation for what's coming. Governors must get busy passing smoke-free legislation so we can afford the burden of 2014. Decreasing cancer, heart attack, stroke, and emphysema expenditures are all that will save states like Kentucky. Hospitals had better get busy implementing programs that promote compliance, decrease 30-day readmit rates, and improve discharge planning. Patients better start eating the Mediterranean diet, exercising, and avoiding sodium so that stroke rates, heart attack rates, and the incidence of diabetes plummet. Communities should help each other by promoting legislation that allows for easy sharing of unused medications by making pharmaceutical repositories not only legal but desirable. Small towns should find ways to get blood-pressure cuffs into places where their citizens congregate weekly to affect heart-failure and stroke rates. Small clubs in conjunction with their local healthcare providers should offer more screening programs. Emergency departments should develop programs that decrease unnecessary office visits by allowing competent nurses to screen calls, make appointments, and facilitate communication between covering physicians and office physicians who will see the patient the next day. Elementary schools and high schools should design programs that teach children how to eat, how to exercise, and how to recognize disease states. The cost to enter and complete med school had better be subsidized, or doctors will become extinct.--

I object to the Affordable Care Tax for the same reason I object to every piece of legislation that asks me to voluntarily surrender my money either in the form of increased taxes or in the form of decreased compensation. This does both. I also object to this piece of legislation for the same reason I object to the existence of Medicare and Medicaid: my money subsidizes poor lifestyle choices. I would agree to this only if they also outlawed tobacco, alcohol, overeating, under eating, obesity, fast food, and added a provision that denied payments for noncompliants, drug addicts, drunk drivers, overdose patients, and thrill-seeking accidents. It's not that I don't think they should receive health care. I just think it's not unreasonable to object to paying for it.

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