By CARL E. FEATHER - email@example.com
“It’s the only service in America where we don’t directly pay for it.”
That’s the curious nature of health care in America, especially for those who have some type of insurance that picks up the tab, said Joe Giangola, an Ashtabula insurance professional who participated in a discussion on the subject Tuesday evening. Giangola said that while Americans historically have been isolated from the real cost of care, that is about to change as more than 40 million uninsured Americans must find insurance or face a penalty.
“We will add a disproportionate number of people to the pool who are going to file more claims,” Giangola said. “The people who are paying (rates) are going to see a disproportionate increase (in their rates).”
Giangola wouldn’t predict where rates will go, although some are predicting increases of 100 percent or more when the health-care insurance requirements of the Affordable Care Act (ACA) kick in Jan. 1, 2014.
The forum, sponsored by the Ashtabula County League of Women Voters, was held at Jefferson Health Care and focused specifically on how ACA will impact businesses, providers and patients. At the end of the nearly two-hour discussion, two things were evident: Health care won’t become more affordable for most Americans and there are likely to be negative repercussions lawmakers didn’t foresee.
For example, small business owner Bonnie Warren predicts she will have to cut staff if forced to provide insurance for her 135 employees. Warren, the sole owner of the home-care business Comfort Keepers, operates in four counties and has a monthly payroll of $200,000. She said that if ACA forces her to provide health care insurance to her full-time employees, she will have to raise the rates she charges customers.
“The minute we raise our rates, we will lose clients,” said Warren, who characterized ACA as “poorly designed.” In addition to laying off workers, Warren predicted ACA will change the culture of her business. Since starting the business 10 years ago, she’s given workers the freedom to select their assignments. But in order to satisfy the government’s “full-time” or “part-time” designations under the ACA rules, she will have to assign workers to cases they otherwise might not have chosen.
“The nice flow we’ve enjoyed for 10 years is not going to be there anymore,” she said.
Robert David, president of UH Geneva and Conneaut, has no doubt about the need for health care reform in the United States. He said that ACA will challenge hospitals and other providers to do more with less and achieve the same outcome, or better, that is realized under the current wasteful system.
That waste, due largely to inefficiencies, is estimated at 30 percent of the total spending on health care, which in 2010 was $2.6 trillion, or more than $8,400 per citizen. David said that at that rate, health care will bankrupt the nation in a few years and workers who have paid into the Medicare Trust Fund will not be able to collect.
“Please don’t expect Medicare to take care of you in your old age,” warned Warren, who said Medicare should not be equated with “long-term” care.
The frequent scenario of patients dually eligible for Medicare and Medicaid presents an especially challenging efficiency problem for providers, and in 27 Ohio counties a pilot program is being tested that, hopefully, will eliminate the waste inherent in deciding which program pays the bills. Ashtabula County is not one of those counties, however, said Kerry Gerken, director of Ashtabula Regional Home Health.
Unlike Warren’s Comfort Keepers, which serves private-pay clients, Gerken’s customer base is the Medicare/Medicaid population. She said the government has not increased reimbursements for home care since 1994, even though home care is much more cost effective than that delivered in a nursing home setting. And she worries that ACA, which will make more uninsured people eligible for Medicaid, will exacerbate the situation.
“I am very concerned about being able to provide the same quality of care,” she said.
Dr. Pam Lancaster said a primary goal of ACA is to encourage preventive care, but she doubts if the United States has enough physicians to meet that goal.
“It’s taking good care of people, not just getting them from episode to episode. It’s trying to put it all together in some sort of plan to keep them healthier,” she said of ACA’s goal.
The current system encourages doctors to dash off a prescription to address an issue such as diabetes or high blood pressure rather than take the time to drill into a patient’s lifestyle and suggest modifications, Lancaster said. And with more Americans having insurance, the demand for services is certain to increase.
“There is a big feeling of insecurity, how (doctors) can take on new patients in an already full practice,” she said.
Doctors aren’t the only ones wondering how they will survive under ACA. Giangola said he’s talking to many business owners worried about the impact that the law’s mandatory insurance requirements will have on their ability to survive. A business with 100 workers will face a penalty of $140,000 — $2,000 for every worker after the first 30 employees — if it does not provide coverage. That is a lot less money than the $1.5 million it would cost that company to insure the workers, who without employer-provided coverage would be forced to purchase their own through an exchange.
The flip side of that, however, is that employers will need to provide coverage in order to retain talent. Or they will have to raise wages so the employees can pay for the insurance from an exchange.
Premiums are supposed to be capped at 9.5 percent of household income, but Warren said that, as an employer, she’s not allowed to ask her workers for that figure. Giangola said federal subsidies for the premiums will be available for certain households with incomes up to $88,000.
“A lot of families in Ashtabula County will be eligible for this,” Giangola said.