Saturday, December 1, 2012

Political and Healthcare Policy Changes:
Post-2012 Election

With the election behind us and President Obama settling in for a second term, the healthcare industry can look forward to a more certain regulatory landscape in which the federal government will likely move full steam ahead on health reform. In this post-election landscape, the following issues and challenges come into focus:

  • The rapid implementation schedule for state and federally-run health insurance exchanges;  
  • State government decision-making on expanding Medicaid programs; 
  • The fiscal cliff’s effect on the American healthcare system and the urgent need to rein in medical costs; 
  • A muddled verdict on voter preferences for Medicare reform; and 
  • The Patient Protection and Affordable Care Act’s (PPACA’s) remaining legal and legislative challenges.

The Kentucky Health Benefit Exchange:
How Obamacare is Changing the Health Insurance Marketplace

Now that the President has been re-elected and the Supreme Court has upheld most of the Accountable Care Act (“ACA”), Obamacare will not be repealed. So, what does that mean for Kentuckians?  Several things including an individual mandate to buy health insurance and a health benefit exchange where Kentuckians can buy insurance.

The component of healthcare reform that was most at risk had President Obama not been re-elected to a second term was the individual mandate.  Under ACA, individuals are required to obtain health insurance starting in 2014.  To make this easier, state insurance exchanges are to be created to provide subsidized insurance products for low and middle income individuals.  The belief is that if more people have insurance, then hospitals, and especially emergency rooms, will not have as many no-pay patients who are treated.  This should mean that the high volume of uninsured patients seeking care in hospital emergency rooms will be significantly reduced and hospital bad debt will also be significantly reduced.  Kentucky, particularly Eastern Kentucky, has extremely high rates of emergency room use when compared to the rest of the state and the nation.  This high emergency room use is coupled with low rates of payment collection.  This makes it very expensive for hospitals to provide services to a population that is often the group that most needs healthcare because of the incidence of chronic diseases, like obesity, more often associated with those from low-income backgrounds.