Repeal…Replace…Reform…

Not the usual three words we’ve come to think of when we hear the phrase “the three R’s, but new “R” words in the news lately about Obamacare. (Yes, I know I said once I objected to the term ‘Americans’, but if you can’t beat ’em, join ’em.) There is so much information that is hitting the media these days, much of it rather confusing and mystifying so I thought I’d take a stab at peeling back the proverbial curtain so you can see the little man behind it. Full disclosure: While I don’t  bill myself as an expert, I have worked in the healthcare for 40 years, the last 17 of it in insurance, which does make me more informed than the average bear.

What’s the difference between “The Affordable Care Act” and “Obamacare”? The simple answer, none. If you thought there was, you’re mistaken. You can’t repeal Obamacare and have the Affordable Care Act left to fall back on. If you get rid of Obamacare, you’ve gotten rid of the ACA. It really is that simple.

If they repeal Obamacare, what will I have for insurance? Assuming you applied for Obamacare because you didn’t qualify for something through an employer, or for Medicaid, Medicare or some other state based plan, probably nothing. That’s why repealing without something in place and ready to go is a problem. 

But they say that there will be access for everyone, right? So that’s good. Not so fast. There is a big difference between access and coverage. Access isn’t the same as actually having the insurance. I have access to any doctor or hospital I want to, if I can pay for it. What if I can’t pay for it? As Bernie Sanders said, “I have access to buying a $10 million home. But if I don’t have $10 million, then I can’t actually buy that home.”  So don’t be fooled when you hear the word access. It isn’t equal to insured, even though there are those that want you to think it is.

My premiums on Obamacare went up, it’s a failure. What a mess. So here is how that works. Insurance is all about risk. The bigger the risk pool, the more spread out the risk is. But it takes time for the pool to grow and get spread out, and you need to have both healthy AND sick people in the pool so that the risk is spread across everyone. In the first years of Obamacare, the most likely enrollees are the sickest, so there are likely to be more people seeing doctors and going to the hospital. That’s going to make premiums go up at first, then they’ll stabilize as other folks who aren’t as sick sign up. But you need to give it time. And have you checked out the cost of your care WITHOUT insurance? Here are some facts:

Average costs without insurance  

Emergency Room Visit	$ 1,200.00
Uncomplicated Delivery	$ 3300-37,000
Cesarean Section	$ 8300-71,000
Daily inpatient rates in hospitals	$ 1700-2300
Daily inpatient ICU rates in hospitals	$ 4,000.00

So yep, go ahead and crab about how much it costs. Don’t come crying to me after you get the bill from your stay for that heart attack/car accident/fourth baby/slip on the ice and broke your leg in three places. Shit happens in life. That’s why we have insurance. 

So I heard with this new program, the premiums will be paid for with Health Savings Accounts instead of subsidies. Isn’t letting people set money aside pre-taxes better than giving them an after tax reduction? Well, I guess that depends on how you look at it. Sure the Health Savings Accounts can be a good thing, and a way to help reduce your tax burden, however it assumes a critical point: That you have enough disposable income after you pay your rent, bills, and buy food that you can afford to have your take home pay reduced. Because let’s face it, even though it’s set aside pre-tax, it will still reduce your take home pay. Maybe not in a 1:1 amount, but it will reduce it. So…this new plan takes away the subsidies from the people who needed it the most, and forces them to have a plan that can only be purchased if they have a Health Savings Account. Take the fictional Johnson family from Minneapolis. Tony and Sara make $34,000 a year, and have 2 children. Sara worked but found that all of her income was going to child care, so it wasn’t worth it and she quit to take care of their children. Tony works for a small company that doesn’t offer healthcare. Under Obamacare, they qualify for enough in subsidies that their monthly premium was $98. Now, under the proposed plan with Health Savings Accounts they’ll need to come up with $1102 a month, which is the current cost of the unsubsidized premium for their family. Does anyone seriously think that’s going to happen? Here’s a newsflash, it’s not. After taxes Tony is lucky if he takes home what $800, $900 per paycheck? And out of that has to come rent, utilities, the car payment, and food and we’re expected to believe that shaving $550 off the top of each check before taxes will reduce his tax burden enough that his paychecks will miraculously adjust enough so that he still takes home at least $800 each paycheck? It ain’t ever going to happen. And so we’ll see the number of newly uninsured skyrocket. Immediately. Because there is no flipping way that millions of people will be able to afford their unsubsidized premiums. They’ll go on Medicaid instead, paid for by your tax dollars. Look for an increase in your property taxes, sales taxes, levies and all sort of other taxes to offset those costs.

As a final note, here’s a message for all of our Congressmen/women and Senators on Capitol Hill. Stop fooling yourselves into thinking this is a Democrat or Republican issue. It’s not. It’s a people issue, and the sooner you start treating it like one, the sooner you’ll actually all stop with the craniorectal inversion and move toward real progress toward a solution.  Healthcare is so godawfully complicated it’s not going to be fixed in a single four year cycle. It will take that long to get it started, understand how your risk pools are imbalanced and how you can make positive changes. Those changes need to be incremental, and just a couple at a time, so you can measure, remeasure, perform some analysis and watch trends. As any halfway decent statistician can tell you, if you start reacting to every blip in the graph and don’t understand which part of your process is within statistical control and and what is out of control, pretty soon you’ll make such a mess of the process that everything will be out of control. Like overcorrecting a skidding car on ice. Instead, if everyone put down their swords, shook hands like adults and agreed to leave your party labels at the door when working on a solution, you might actually have a fighting chance of coming together to solve this. Follow quality improvement principles used in businesses such as PDCA and Kaizen. (This ain’t rocket science, it just requires you leave your egos outside the door. Sheesh.) Where I work we are fortunate to have developed a culture built on values that help us to become better and stronger as we work together. Some of those values are integrity, compassion and relationships and I can’t help but think that if applied as part of the process to solve this problem, maybe real change could finally begin.