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King v. Burwell: A Brief Respite For Obamacare

King v. Burwell: A Brief Respite For Obamacare

By Wendy Wolf and Morgan Hynd

Published on Health Affairs

Most health foundations in states with federally facilitated health insurance marketplaces breathed a collective sigh of relief after the King v. Burwell Supreme Court ruling, which retained the availability of federal subsidies for health insurance coverage. In Maine, where 89 percent of people in Marketplace plans qualified for subsidies, this ruling ensures that individuals and families can keep affordable health plans and promotes stability in our private insurance market—at least in the short term.

As King v. Burwell recedes in the rear-view mirror, health funders need to focus our collective attention on the next set of fundamental threats to the Affordable Care Act’s (ACA’s) nascent successes.

We regularly hear about the frustration and heartbreak when navigators find the person they’re helping falls below the income threshold for the ACA subsidy. Every day, they cope with the tears and shattered hopes of lower-income people whose only option for affordable coverage is through Medicaid. National and local funders need to support robust advocacy efforts and policy research that motivates businesses, hospitals, and public officials to support Medicaid expansion in every state.

  • Spotty Risk Pools Leading to Charity Care and Cost Shifting: The success of the ACA is dependent on having near-universal coverage to broaden health plan risk pools, decrease charity care, and promote higher-value delivery of care with early prevention and better primary care. Without Medicaid expansion in the Pine Tree state, Maine hospitals and health clinics are reporting substantial increases in uncompensated care costs, which are driving their bottom lines into the red. As providers struggle financially, they must make up for losses by cost shifting to the private market, which, in turn, drives health insurance costs higher and higher.

This is the very scenario that fueled the rapid growth in health care costs and in insurance premiums prior to the ACA. As long as sizeable numbers of people fall into the coverage gap, upward pressure on costs will continue this cost-shifting phenomenon that drives higher and higher insurance premiums.

  • High Costs of Care and Not Enough Transparency: The ACA has included some important policy decisions and initiatives to rein in health care costs, but this arena is Obamacare’s potential Achilles heel . In Maine, our consumer help lines regularly hear from people in Marketplace plans who are still struggling to meet deductible and co-insurance costs. A recent Families USA report found that one in four people who were insured through a private Marketplace were unable to get care because of high out-of-pocket costs. Various news stories, such as Steven Brill’s exposé, “America’s Bitter Pill,” which originally appeared in Time , and research reports continue to show wild variations in health care charges that don’t correlate to high-quality or better care.

And some of the better strategies within the ACA to rein in costs, such as the establishment of the Independent Payment Advisory Board (IPAB), have been continually assailed by groups, including the American Medical Association and some members of Congress. MeHAF, the Blue Cross and Blue Shield of Massachusetts Foundation , the Robert Wood Johnson Foundation , and the Commonwealth Fund are just a few of the health funders that have stepped up to the plate to work with public and private partners to advocate for payment reforms that can promote transparency, contain costs, and rationalize health care spending. This issue, in our view, is the most important linchpin to the ACA’s eventual success or failure.

There’s no question that the ACA has been a game-changer in expanding access to affordable coverage and care for millions of Americans. But we’ve got a long way to go before we fundamentally transform our health care system to one that provides universal coverage and meets the Triple Aim of improving population health, enhancing the experience and outcomes for the patient, and reducing per capita cost.

The hourglass to control payment and costs is running out. Are health foundations up to the task?

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