Wednesday, November 28, 2012

Whither Obamacare, Now That "It's the Law of the Land?"

While a roll-back of Obamacare now is about as likely as spotting gargoyle statuettes among the DMCB spouse's holiday decor, a recent New England Journal article points out that the Affordable Care Act (ACA) - even if it is the law of the land - still has a very bumpy road ahead.

That's because of four key issues:

1. The States can still knot things up by forcing Washington DC to run the Health Insurance Exchanges (HIEs).  It's very possible that Uncle Sam won't pull them off on time and, what's more, there's a credible Supreme Court challenge looming over Obamacare's potential lapse in extending tax credits to the federally-run HIEs.

2. States can refuse the Medicaid expansion. While their statewide hospital associations are very  unhappy about that, Governors are either ideologically opposed or just plain wary of additional downstream costs. This could result in additional millions of uninsured, especially in the conservative "red" states.

3. Health care cost inflation is likely continue its upward spiral.  Congress, no matter how CMS' payment innovations turn out and no matter how much it wants to curtail costs, is unlikely to withstand the lobbying from all corners of medical-industrial complex involving thousands of pages of rules and regulations.

4. Deep public ambivalence about the law will continue. That means that as Congress and the President look for ways to control the Federal deficit, Obamacare is especially vulnerable. Unlike Social Security or Medicare, the ACA's "patchwork" of insurance reforms is headed toward the fiscal cliff without a strong supportive constituency. Before Congress even touches Medicare, it's far more likely to cut Obamacare. The first hit could be those insurance tax subsidies mentioned above.

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