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Analysis of the Patient Protection and Affordable Care Act

Paper Type: Free Essay Subject: Health
Wordcount: 6789 words Published: 22nd Mar 2019

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Health care and healthcare policy has continued to evolve over the last century. At the end of the 19th century due to the advancements made in the medical and research field, public health projects were implemented to fight some of the leading causes of disease and to provide health awareness and to raise the overall health of the general population. Some disease were practically eradicated. With concern of the general health and welfare of the nation, healthcare programs were extended into the schools through school nurses. (Fillmore)

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During the first part of the 20th century, the US witnessed the establishment of the first large medical insurance company, the rise of private health insurance, and employer and labor union sponsored health care. (Fillmore) However, it was not until the 1930s-1940s that the federal government began to consider the true need for all citizens to have fundamental healthcare. Franklin D. Roosevelt, during his 1944 State of the Union Address, established the political idea that citizens of the United States should have the fundamental right to adequate health care. This political philosophy been the premise on which governmental health care policy has founded upon. Over the past half-century, government’s involvement in health care and in the development of healthcare policy had increased due to the rapid rise in healthcare cost and general concern over rising health issues minorities, and individuals living in poverty. “Without adequate health care, no one can make full use of his or her talents and opportunities. It is thus just as important that economic, racial and social barriers not stand in the way of good health care as it is to eliminate those barriers to a good education and a good job.” (Kaiser Health News, 2009)

Healthcare Reform Legislation

            Historically the United States has tried to avoid providing universal healthcare for all citizens. Instead, financing healthcare continued to be linked to employment. (Landreanau, 2003) In part, this avoidance has been directly related to the general public’s view of democracy, laissez-faire economics and a general fear that government sponsored universal healthcare can lead to socialism. It has only been during times of great economic and social need that the federal government has been able to successfully implement healthcare policies and programs on a broad spectrum. Debate over national health insurance has been raging for over a half of century.


Beginning with the heavily contested Social Security program of 1935. The Social Security Act provided grants for Maternal and Child health. As early as 1943, proposals by Senators Wagner and Murray in conjunction with Representative Dingell introduced a bill to provide a universal comprehensive health insurance as part of social security. The proposed changes would have provided a birth to death social insurance for the American public. The proposal did not pass during the 1943 legislative session. In 1944, the Social Security Board advocated for a compulsory health insurance as part of the Social Security System. In 1946, even with a new executive in the White House, advocacy for a national health program continues. In 1946 and 1947, a revised Wagner-Murray-Dingell bill is reintroduced to Congress for a National Health Program. This bill has executive support, but Congress failed to act upon the bill. The nation continues to grapple with how to deal with the increasing number of citizens’ without healthcare. In 1954, to provide incentives for employers to provide employee healthcare coverage and in keeping with the philosophy of limited government intervention into this area, the Revenue Act of the 1954 was passed. This act provided tax deductions for employers that contributed to employee health plans. (Kaiser Family Foundation, 2017)


In the 1960s, the United States healthcare system continued to grapple with the question as to how to provide healthcare coverage for unemployed individuals, the elderly, and children. In 1965, the US began to see major healthcare change. With the passage of the Social Security Amendments Act of 1965, Medicare and Medicaid were established. These programs are still in existence today and have continued to be expanded upon. (Kaiser Family Foundation, 2017)

The 1970s brought a season of inflation, high unemployment, and unrestrained rising healthcare costs. These concerns were creating a growing concern politically, socially, and economically. Once again, policymakers began to advocate for National Health Insurance. In 1973 President Nixon signed the Health Maintenance Organization Act. This piece of legislation was beneficial because it removed barriers that prohibited HMOs at the state level, provided subsidizes for qualified HMOs and mandated employers who provided employee health insurance to offer HMO options when possible. President Nixon hoped that HMO Act would be a springboard for his Comprehensive Health Insurance Plan. ”The national health insurance bill that I will be submitting to the next session of this Congress will allow patients to use such insurance to join HMO’s. For that reason, it is particularly important that this demonstration effort get underway immediately and build upon the momentum which has already been achieved in this field.” (Nixon, 1973) This proposal never saw fruition because it was overshadowed by the political scandal surrounding his presidency and subsequent resignation. As the economy continued to decline, policymakers began to focus on the necessity to contain healthcare cost in addition to providing coverage for uninsured. (Kaiser Family Foundation, 2017)


Each decade continue to expand government’s role in healthcare and the provisions provided to the public. Debate was often heated among policymakers about the expansion of government into healthcare, but governmental programs continued to expand due to concern for the general health and welfare of the public. In 1980, the Medicare Catastrophic Coverage Act was passed. In 1990, the Clinton Administration decided to make National Health Coverage a priority. Even though the proposed Health Security Act of 1993 failed to pass, once again the Nation is facing the questions of how to deal with rising healthcare cost,
the free market, and the uninsured. Despite the expansion various government sponsored health program and government based incentives, the number of uninsured continued to rise. (Cohen, et.al, 2009)

From 1968-1980, for individuals under age 65, private insurance coverage was 79%. This percentage remained relatively until the recession of the 1980s. From 1980 until 2007, the percentage of individuals under the age 65 with private coverage continued to decline at an average rate of 1% per year. This downward trend of private, employer-sponsored insurance continued to illustrate national need for healthcare coverage for all citizen. (Cohen, et.al, 2009)

As states began to realize that comprehensive healthcare reform was not going to happen quickly at the national level, several states began to invest research and funds into designing comprehensive healthcare reform at the state level. Massachusetts and Vermont successfully pass legislation in 2006. These plans become a working model for the Patient Protection and Affordable Care Act of 2010.

Patient Protection and Affordable Care Act of 2010

            The Patient Protection and Affordable Care Act, frequently called “Obamacare” was signed into law March 23, 2010. This revolutionary, controversial, single piece of legislation expanded government’s role in healthcare and mandated a basic level of healthcare. It transformed the relationship between the individual, business, and the federal government. (Twight, 2009) Prior to this sweeping piece of legislation, the decision to have or not have health insurance was an individual choice. It was considered a fundamental right to make an informed choice. Prior to the passage of the Patient Protection and Affordable Care Act, access to health care was limited to those that could most afford it, despite governmental programs such as Medicaid and Medicare.

            One understands how this sweeping piece of legislation was initially favored and supported by many. The “policy window of opportunity” was open due to skyrocketing health cost, limited access to health services, rising health problems, increasing premiums, and patient spending on deductibles outpacing wages. (Altman, 2016) In 2008, 27% of the nonelderly with three or more chronic conditions spend more than 10% of their income on healthcare. In 2010, the United States spent 2.6 trillion dollars on health care. (Henry J Kaiser Foundation, 2012)

 After an approximate 50 year period of increasing governmental involvement in healthcare and public acceptance through programs such as Medicaid, Medicare, Veteran Health Affairs (VA), a large portion of society seemed eager to see this type of legislation become a reality. Proponents of a national health care system were able to garner the support of the majority in the Legislative Branch and Executive Branch and with creative marketing and “politicking” ensured that the bill became law.

After a decade it is time to evaluate the policy.

There are several main components to the Patient Protection and Affordable Care Act. First, it prohibits insurance companies from denying coverage for individuals with pre-existing conditions and coverage cannot be revoked except for incidences involving fraud. Second, each state is required to establish a Health Benefit Exchange to allow businesses and individuals to purchase insurance and states are required to establish a minimum of one reinsurance entity to expand available coverage. Third, individuals must purchase basic health insurance or incur a fine. Fourth, employers with fifty or more employees must provide health coverage for incur a fine whereas, business with twenty-five or fewer employees can receive a tax credit for the company’s health coverage expenses. Fifth, states would be allowed to prohibit qualified insurance plans from covering abortions and no federal funds would be allowed to be used for abortions. Sixth, beginning 2014, sates are allowed to expand Medicaid coverage to low-income residents under the age of sixty-five. Finally, expanded coverage for seniors and low-income residents through Medicaid was provided and reimbursement plans were reformed to curb fraud and to help curb the rising costs of prescription drugs. (Auerbach, 2017) After taking a comprehensive look at the Affordable Care Act, two broad categories exists: (1) expansion of health insurance and (2) reformation of the healthcare delivery system. (Blumenthal, Abrams, & Nuzum, 2015)


One of the primary goals of “Obamacare” was to ensure that Americans have affordable healthcare coverage, access to services, and to control health care costs. Under the law, the number of uninsured nonelderly Americans decreased from 44 million in 2013 to less than 28 million as of the end of 2016. (Henry J Kaiser Family Foundation, 2017)

Many Americans would forego medical treatment due to lack of insurance or lack of funds. The Affordable Care Act was created to ensure that the over health of the population improved. Medical professional and government officers agreed that lack of medical care often led to higher medical costs due to untreated illness, lifestyle diseases such as Type 2 Diabetes, Obesity. Since the passage of the Affordable Care Act more Americans report that they have a primary doctor and have sought preventative medical care within the last twelve (12) months.

Surveys show that the newly insured are pleased with their coverage. Three quarters of those seeking to make an appointment with a primary care physician or a specialist secured appointments within 4 weeks or less. (Blumenthal, 2015)

The Council of Economic Advisors (CEA) reports improvements in the area of individual health. Reports show the rate of hospital-acquired infections in the United States declined by 21 percent between 2010 and 2015 with an estimate 125,000 fewer patients died in hospitals. Medicare patients’ hospital readmission rates declined substantially; an estimated 565,000 readmissions were avoided between 2010 and 2015 as a result of the Hospital-Acquired Condition Reduction Program (HACRP) of the Patient Protection and Affordable Care Act (ACA). (The Advisory Board Company, 2016)

The data clearly supports that more individuals have access to health care and improved health conditions due to measures provided in the Affordable Care Act such as the Hospital-Acquired Condition Reduction Program (HACRP), individual wellness programs, preventative care, prohibitions for health care policy recissions, elimination of annual and lifetime limits for benfits and coverage, enrollment denials due to pre-existing conditions,and most importantly capping out of pocket expenses.

 Yet, in 2016, 27.6 million Americans still remained uninsured. The uninsured still site cost as the main reason for lack of coverage. Despite the ACA’s insurance subsidies, many still feel that insurance costs are too high and unaffordable. (KFF Updated: Nov 29, 2017 | Published: Sep 19, 2017, 2017) One of the reasons that individuals may find the cost of coverage prohibitive is in part due to the regulations in the ACA. An example being a married couple in North Carolina. The husband is self-employed and the wife is eligible for employer sponsored health care. The wife may purchase spousal insurance from her employer. The cost of the wife’s spousal plan may be more costly than the couple can afford to purchase. In this scenario, the husband will not qualify for insurance subsidies should he wish to purchase insurance outside of his wife’s employer.

The total number of newly insured fell short of the original estimate because many them had previous coverage but had to reenroll because their plans did not meet the new standards. (Blumenthal, 2015) Of the 17.7 million persons who gained access through the ACA, 14.5 million were enrolled in Medicaid and CHIP programs. (Mofit, 2016) Which questions the success of the healthcare exchanges.

            Prior to 2010, medical costs were skyrocketing. Uncontrollable costs were outpacing the public’s ability to pay for healthcare. An essential part of the ACA is directly related to health care cost containment. Part of the ACA’s cost containment plan involved incentives and penalties for medical performance, coordination of care, bundling payments, and the development of Accountable Care Organizations.        

Beginning in 2012, hospitals with higher than expected readmission rates were penalized. Progams were expanded to reduce the number of patient related conditions acquired while the patient was hospitalized. Costs and payments were restructued to help contain rising medical costs. Through Accountable Care Organizaitons (ACOs) doctors, hospitals, and other medical entities come together to coordinate care. The goal is to ensure that medical servcies are not duplicated, ensure quality patint care, and coordinate overal services. Providers that are part of an ACO will share in the savings (financial incentives) but will also experience risk for patients that have greater expenses than what is deeped necessary. (Blumenthal, 2015) Despite strong advocay for this model, it has not been as successful as orginially hoped. Savings has not occurred on the scale that was estimated. “ACO growth has slowed and the downward trend is expected to continue (http://www.fiercehealthcare.com/story/3-reasons-slowed-aco-growth/2013-11-01) because the market is tapped out, there is no proven ACO model and payers are reluctant to offer ACO contracts.” (Sullivan 2013) “The Pioneer ACO Model is one of the more progressive initiatives coming out of the Obamacare health reform, but seven of the pioneer ACOs report no savings, and two others are leaving the program completely. Richard Foster, an analysts with the Centers for Medicaid and Medicare Services, estimates that national health spending would increase by an estimated $311 billion dollars. This projection exceeds increases that would have occurred had the Affordable Care Act not passed. (Mofit, 2016)


From the beginning, the ACA has been problematic. Starting with legislative development. “By our count at the Galen Institute, more than 70 significant changes have been made to the Patient Protection and Affordable Care Act, at least 43 that the Obama administration has made unilaterally, 24 that Congress has passed and the president has signed, and three by the Supreme.” (Turner, 2016) Therefore, the law that was passed is not the law that is in existence today. From the start, it was easy to see that the original objectives of the policy would not be achieved and that the cost of the program as designed would far outweigh the benefits to society as a whole. (Turner, 2016)

One of the first issues that must be addresses is the overreaching nature of the legislation. Many individuals object to the ACA because the costs are considered to be too high: politically and financially. According to Christopher Conover, Duke University professor of health policy, “Obamacare has done more to eviscerate the rule of law & constitutional design than any other major statute” (Conover, 2016). Opponents claim that ACA will transfer one-sixth of the US economy into the hands of politicians and agency bureaucrats. (Manchikanti, L., & Hirsch, J. A. (2012)

Several major issues have occurred causing Americans concern over the advisability of the ACA. First, President Obama promised the American public “if you like your plan, you can keep your plan”. This was not the case. Insured Americans were upset and surprised when insurance companies canceled policies that did not meet the new minimum standards set by the ACA. Second, new marketplace restrictions were placed thereby restricting access to providers in an effort to control costs. Third, increased premiums have forced individuals to purchase plans with large deductible and high copayments. (Blumenthal, 2015)

Americans are feeling the financial pressure due to the ACA. Premiums have soared. The Congressional Budget office predicts that premiums growth will accelerate over the period between 2016 and 2025. Projections show increases of approximately 60% with an annual increase averaging 8%. (Mofit, 2016)

            American’s tax bill is rising due to the ACA. It is projected that between 2016 and 2025 “Americans will pay an estimated in $832 billion in taxes, including taxes on health insurance plans, drugs, and medical devices that will be passed on to the middle class. (Mofit, 2016)

            The ACA provides for health insurance exchanges. These entities are a “Health Insurance Marketplace, a service available in every state that helps individuals, families, and small businesses shop for and enroll in affordable medical insurance.” (Exchange – HealthCare.gov). Though touted be similar to health insurance exchanges in the fee marketplace, instead, ACA exchanges are heavily regulated and federally supervised. After six year and $5 billion dollars in expenses, only 13 states are operating their own exchange. Critics site this a waste of funds. (Mofit, 2016)

                In general, American’s have a somewhat negative image of the Affordable Care Act. “Forty-four percent surveyed in Gallup’s most recent update approve of it, compared with 51% who disapprove. The public’s approval of the healthcare law has consistently been below the majority level in recent years, ranging from a high of 48% shortly after Obama won re-election in 2012 to a low of 37% approval in late 2014.


Reportedly, this is one the ACA’s stronger points. With new ACA regulations, obtaining coverage has been made less discriminatory. ACA legislation prohibits age, race, gender, and disability discrimination. “Section 1557 extends nondiscrimination protections to individuals participating in:

  • Any health program or activity any part of which received funding from HHS
  • Any health program or activity that HHS itself administers
  • Health Insurance Marketplaces and all plans offered by issuers that participate in those Marketplaces.

Section 1557 has been in effect since its enactment in 2010 and the HHS Office for Civil Rights has been enforcing the provision since it was enacted.” (HHS Office of the Secretary,Office for Civil Rights & OCR, 2018)

 ACA has attempted to ensure that healthcare coverage is available and affordable for all. The legislation provides subsidies for those that are least able to afford the healthcare. However, administration delayed implementation of the Basic Health Program designed to provide more affordable coverage for certain low-income people not eligible for Medicaid until 2015. (Turner, 2016) However, disparities still exits for those that cannot afford to pay.

Political Feasibility

The ACA’s mandate requiring all individual to have healthcare has been unprecedented. The requirement to maintain health insurance or pay a penalty has been highly contested. Critics state that the ACA is a violation of personal liberty and a prime example government overreach. Critics proclaim that individuals should have the right to determine if they wish to engage in “commerce”; to join the insurance market place to purchase insurance.

In other areas the Affordable Care Act has been filled with problems and mishaps. Administratively, the Affordable Care Act has proven to be a policy and political nightmare. Beginning with the rollout of the program, technical and operational difficulties with the computer programming and the federal government’s website made it almost impossible for consumers to enroll in the health insurance exchanges during the 2013 rollout of the healthcare.gov website. Frustration levels were high and the public rapidly began to become disenchanted with the process. According to the Department of Health and Human Services Office of Inspector General, “ ‘Most critical were the absence of clear leadership, which caused delays in decision-making, lack of clarity in project tasks and the inability of CMS to recognize the magnitude of the problem as the project deteriorated.’ “(Moffitt, 2016)

The best illustration of the political fallout over the ACA can be seen in the results of the last election. Opponents of the ACA have now taking political control of the legislative branch and the executive branch.


            The Affordable Care Act is a sweeping piece of revolutionary legislation that attempted to tackle too many issues at one time. The ACA “launched too many divergent experiments and lacks a coherent strategy.” (Blumenthal, 2015). The ACA has successfully expanded healthcare coverage to millions of Americans but at the price of personal liberty and the free market. The current law reinforces third-party payment and restricts personal choice in health plans and coverage options. The ACA has created a constitutional nightmare over challenges ranging from taxing authority to separation of church and state issues. (Blumenthal, 2016)

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            It is interesting to note, that for the past 15 years, according a Gallup poll, a majority of American have rated the quality of their personal healthcare as either excellent or good. Yet, when asked if the healthcare law had helped or hurt the healthcare situation in the U.S., or if it has had no effect, forty-five percent of Americans responded that it hurt the healthcare situation, 37% responded helped it, with the rest (12%) responded saying it had no effect. Gallup Polls show that if given a choice Americans prefer a privately run healthcare system over a system run by the government. (Gallup Inc., 2016). Seventy-three percent (73%) of employed Americans say the healthcare system is “in a state of crisis” or “has major problems”. There is little difference between American workers’ attitudes on the healthcare system and the overall U.S. public, among which 71% of all Americans state that the system is in “crisis”. (Gallup, Inc., 2017)

            It is apparent that the current system is in need of revision. President Trump, promised Americans that his Administration would repeal and replace “Obamacare.” According to a Gallup poll in early 2016, 58% of American favor repealing the healthcare law and replacing it with a federally funded single-payer system designed to cover all American. It is interesting to note is that the public wants a federally funded system, but did not mention a system “run” by the government.

            Repealing the Affordable Care Act would leave a huge whole in many American’s healthcare and healthcare coverage without proper intervention and legislation. It would be necessary to have a working plan, not just theory and political rhetoric. According to the research conducted by the Heritage Foundation a good workable plan would include several factors: (1) replacing the existing tax system for commercial private health insurance with a national tax credit system, (2) provide funding for the economically disadvantaged, and (3) transform Medicare into a premium support program. (Politics & Government Week, 2012) These are sound principals but should include a defined contribution plan. A defined contribution plan addresses the health care needs of Americans through the creation of a system that offers defined contributions to an employee’s health plan. This would empower employees to make decisions about their own health coverage. The program is similar to approach of the health insurance system that currently covers 9 million federal workers, dependents, and retirees. (Turner). This is a possible solution but it would be necessary to adjust the tax liability of these plans. Continuing to ensure that coverage is not denied to individuals and maintaining the social equality of healthcare is essential.

                Prior to the passage of the ACA, our healthcare system was in need of adjustments. However, ACA has proven to not be the answer. Returning to a free market will encourage competition and return supply and demand to the equation. Continuing to providing safeguards against coverage being dropped and/or denied will need to remain part of any new plan development.


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