Affordable Care Act Focuses on Workers, Removes Perverse Incentives

President Obama’s Affordable Care Act (ACA) was not directed at the poorest Americans, who already have Medicaid, but at the working poor. This includes those who work full-time, but cannot afford their own health insurance policy. In addition, low-wage jobs are far less likely to provide health insurance benefits. Thus, typical low-wage earners are left on their own to purchase prohibitively expensive private health care plans. In 2010, the average cost for a private family insurance plan was $7,102. In many locales throughout the U.S., it is mathematically impossible for a low-wage breadwinner to pay for a $7K private insurance plan while paying for all other essential family expenses. What’s worse, before ACA, if one became seriously ill and required extensive treatment and thus could not work for a long period, they would often lose their job, and with it, their health insurance. Some conservatives counter-argue that only those who work hard deserve health insurance and good health care. But this argument is a non-sequitur. Health insurance is generally unaffordable for the working poor and even parts of the working middle class, who as I pointed out in one of my last posts, work more hours on average than the wealthy.

Another thing to consider are the perverse incentives that existed within the system prior to the passage of ACA. Previously, many Americans were in a situation where they did not qualify for health insurance under Medicaid because they earned too much. However, they did not earn enough to purchase their own private insurance plan. Thus an incentive existed for people not to work in order to qualify for health care under Medicaid. The health care reform bill eliminates this problem by not only requiring the working poor to buy insurance, but helping them significantly with the premium (in many cases, paying for it completely).

My latest posts can be summarized as follows: Positive rights, including the right to adequate health care, the right to a basic education, the right to food and shelter, the right of the disabled to adequate care, are essential for protecting the most vulnerable among us. Guaranteeing these rights does not mean giving up our free market system. But it does preserve our moral values and helps forge a more promising future for all Americans. As Elizabeth Warren noted, America’s most successful businesses and individuals would not be where they are where it not for our great American system with its institutions and programs. Billionaire investor Warren Buffet confirmed this notion when he pointed out recently that many of America’s super-wealthy recognize that this country has given them a unique opportunity. We should vigorously defend and improve America’s key institutions, infrastructure, and social programs if we desire continued success.

7 Replies to “Affordable Care Act Focuses on Workers, Removes Perverse Incentives”

  1. “…Positive rights, including the right to adequate health care, the right to a basic education, the right to food and shelter, the right of the disabled to adequate care, are essential for protecting the most vulnerable among us. Guaranteeing these rights does not mean giving up our free market system. But it does preserve our moral values and helps forge a more promising future for all Americans.”

    I would like to respond to you from first-hand perspective….you have chosen to follow me on twitter–thus I found your blog… While your statement above sounds ideologically sound and in a perfect world w/ honorable politicians perhaps these ‘rights’ could be implemented (personally, I believe what you’re suggesting is called socialism, and I could give you first-hand experience on why it never works…(ever)-but that’s another discussion….Unfortunately, politicians/gov’t are less than scrupulous and crony capitalism reigns…for example, the gov’t is in bed w/ the drug industry, etc…

    We have a daughter who had a life threatening adverse reaction to a government mandated vaccine which left her profoundly developmentally disabled. We LOVE her and have cared for her 24/7/365 for the last 17 years with the assistance of Medicaid-waiver programs. Honestly, I don’t know how we could give her such quality of life (w/ 3 siblings) without this assistance. We filed a claim w/ the VAERS system- meant to take care of those damaged and after 16 years we were finally told that the gov’t has new guidelines for vaccines-damages/conditions/sympotms and that we no longer have a case. This is why I imply above- gov’t CANNOT be trusted with making ANY programs function w/o cronyism or dysfunction.

    Recently, every single program, service provider, respite care personell, home health care provider we utilize has been SCRUTINIZED beyond belief. I live every day IN FEAR of losing these services. The FACT which you do NOT mention, and the one factor which will drive every medical decision as this ACA is implemented is that 500 BILLION dollars has been effectively taken out of the medicare/medicaid programs and 30 MILLION more people will be added to the rolls. (LOGIC) tells me and should tell you that this cannot work without HURTING those most vulnerable, namely the disabled and the elderly. I believe that ideology is one thing, REALITY is entirely something else. We have hard facts and history of how (badly) this type of gov’t-run ‘healthcare’ is FAILING in Britain and Canada–causing the emerging acceptance of euthanizing vulnerable patients, often the elderly and the disabled- Is this the world you really want to live in? I don’t ! Be careful what you wish for…

    1. Thank you for reading our blog and sharing such a personal comment. We appreciate hearing from you and I really hope that you aren’t adversely impacted by any upcoming changes to Medicaid.

      I have no doubt that there are significant ways in which Medicaid could be improved and I’m also am worried about the long-term sustainability of Medicaid and Medicare. And I don’t think ACA did enough to address those problems.

      Your comment implies that there are many disabled and vulnerable Americans who absolutely rely on Medicaid and Medicare (i.e. government-run health care programs, or socialized medicine), and that’s absolutely true. The challenge confronting the Obama Administration prior to ACA was that there were nearly 40 million Americans without insurance, the vast majority of whom could not afford it on their own.

      I wrote an earlier post addressing some of the issues you brought up: http://www.mormondems.com/?p=161

      Many of the working poor, a large segment of whom are uninsured, are at a critical point, where they are one serious illness away from losing everything- their jobs, their ability to pay for any health care whatsoever, and so forth. Without having the universal coverage that ACA provides through the insurance mandate and insurance premium subsidies, this large swatch of the population would continue to be extremely vulnerable.

      Additionally, every industrialized country in the world has a national health care system, except for the U.S. (prior to ACA). While there are significant variations in the quality of care these systems deliver, they all spend a much smaller percentage of their GDP on health care and most have significantly better health outcomes. The research on these facts is extensive and solid. I’ve personally experienced health care in other countries that have national health care systems, including Germany, and found the care to be exceptional, just as good, if not better than the care that I got in the U.S. Perhaps not coincidentally, the German health system is much more similar to ACA (a system with a hodge-podge of public and private universal insurance coverage) than the Canadian or British health systems.

      1. You spew all of the Dem “talking points” -very disappointing. Have you ever done a survey of what medical professionals think ???? —> Reality.

        By Kathryn A. Serkes
        Chair & Co-Founder,
        Doctor Patient Medical Association

        (Washington) – As the amateur media psychiatrists fall over themselves to get in the head of Judge Roberts’, what do actual doctors think of the Supreme Court ruling on the “Affordable Care Act?”

        In a word – angry.

        “The federal government needs to get the HELL out of the practice of medicine,” writes an internist from Washington State. “Here’s the bottom line: you cannot give away free medical care. Until they stop entitlements, this whole system is doomed, unfair, and chaotic.”

        “It bothers me several to many times every day. Why the hell did I invest 34 years to be a very low level 99%er?” bemoans an orthopedist from New York.

        And more from a family practitioner in Texas: “I own a 4 physician F[amily P[ractice] group. I will be out of business when Obamacare is fully implemented…”

        “If the Government continues legislating more pressures on doctors, medicine in the US will come to a halt. There will be a two tier system: those that can pay for private medical care & everybody else (in the socialized system,)” warns another.

        “My husband, a physician, will be an early retiree, as will many of his contemporaries,” writes Kathleen on our Facebook page this week.

        A husband and wife from Wisconsin- both physicians – write that they will not let their teenagers become doctors.

        There is even a burgeoning consulting area to teach doctors how to leave patients behind and become highly paid pharmaceutical executives, motivational speakers and expert witness (oh great, more lawsuits). Brochures for expensive workshops feature trainers like a former ER doctor who is now a “Master Sherpa Coach.”

        One resident tells us that he likes clinical medicine – actually treating patients – too much to quit, but thinks about taking his education and skills overseas. “I’m beside myself about the bureaucracy involved in practice in the US and actively assessing my options for a post residency career abroad,” says Kyle Varner.

        Long-established doctors are thinking the same thing. “Some days I just want to run to Africa or Mexico and just take care of sick people, and not have to explain myself to a dozen bureaucrats who don’t even know what I am doing,” says a family practitioner in Colorado.

        The real question for us as patients is, what will doctors do with all of that anger and frustration? Will they just throw up their hands and walk away or will they drink the kool-aid and become the compliant “providers” that government and insurance companies want them to be?

        Or are these just idle threats to get our attention? This week it’s not looking good.

        Will doctors stage a massive uprising or walk-outs and strikes like in the U.K , Germany and other nationalized health care countries have seen?

        Not likely. Doctors here rarely do anything en masse, which is good for us as patients.

        But when 8 out of 10 doctors are thinking about quitting, this law has triggered a disaster in slow motion as PPACA’s thousands of regulations, taxes and controls are implemented in the next ten years.

        Some of the doctors tell us they are ready to fight, like this podiatrist from Florida: “The doctors need to stand up and fight with a united front instead of taking these changes lying down. With the direction we are going, we will have the worst medical system in the world.”

        But they can’t do it alone. Unless patients and doctors start partnering up to repel the government control and government-protected corporate control, doctors will be left to fight on their own. And they haven’t been very successful so far slaying the AMA dragon and its big bucks.

        And unless we start figuring out ways to deliver actual medical care, we’ll have millions of people knocking at the doors of empty office buildings with a now-worthless piece of paper that says they are “insured” when PPACA takes full effect.

        And like Elvis, the doctors will have left the building.

        The Doctor Patient Medical Assn. is a non-partisan group working for freedom in medicine for doctors AND patients. Our goal is increased choice and access to medical care. You may reach Kathryn at Kathryn@DoctorsandPatients.org.

        1. JT- we appreciate you visiting our blog and commenting.

          I suspect by your comment you may not be aware that the largest association of medical professionals, the American Medical Association (AMA), has supported and continues to support the Affordable Care Act (ACA). Of course, there are doctors who oppose the current bill, but here is a statement from the AMA issued after SCOTUS affirmed ACA: http://www.medicalnewstoday.com/articles/247288.php

          Here is another article showing a variety of opinions of various medical professionals about ACA: http://www.buzzfeed.com/buzzfeedshift/doctors-react-to-the-survival-of-obamacare

          The group in the article you cite is very small and very new- they’ve only been around since last Fall! http://www.doctorsandpatients.org/who-we-are
          Using their anti-ACA statement to make a broad assertion about all medical professionals is a really flimsy argument.

          I realize that there are many doctors who oppose ACA, but I don’t know if it is a majority. Some medical professionals I have personally spoken with do not think ACA went far enough and would really have preferred a single-payer system. The issue of doctor support for or against ACA is much more complex than you or that article assert.

        2. I work at UAHN in Tucson Az. I asked my Dr. about EPIC, the required ACA HIPAA secure electronic records software, it cost over 120 million dollars and his opinion was that we were basically too broke to buying this at this time. The CE personell said it was not that consistant and that contractor is supposedly gone. Since the ACA I have been required to take HIPAA tests monthly. I’m a maint. tech., plus I come accross HIPPA issues often and take care of them i.e. cover sheets ect all the time. The overwhelming cost of a national registry that will be HIPAA complient with what I’m finding is very disturbing. There still is no real answer to how many Healthcare entities that will require hyper secure HIPAA software but if UAHN is any indication this HIPAA issue is going carry massive costs. Plus since the ACA was passed our self-pay ER visit % has actually increased by upwards of 4%. If the ACA can not guarantee 100% complience with HIPAA there could be extremely costly consequences.

  2. Bottom line is that living in a gated community wont keep us or our family from  an epidemic.  Someone without health coverage is planting, picking, and packaging our food.  Another is selling you a new phone, and the nice guy in the Brown Truck delivers to an average of 120 locations everyday.  He has a one of few good plans left for non-skilled workers. Who packed the phone, who put the phone in the box and who last used the UPS mans little computer you now hold in your hand?

     Hospitals:  many part time non-covered or they sub out services to who? And Now more and more professionals in the industry choose to work by contract with no benifits to get the bigger paycheck. We have to do Health Care as “One Nation” like it or not.

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