The Impact of Recent State and Federal Legislation: The Affordable Care Act

Executive Summary

Hospitals experience a lot of medical issues that need to be addressed, among them chronic conditions, of which many are acute or emergent, presenting specific challenges (Larrat, Marcoux & Vogenberg, 2012). The Affordable Care Act’s (ACA) legislation causes problems regarding insurance coverage and reimbursement for all patients posing risks on their care. Hospitals have to operate with insurance firms that observe the overarching federal regulations. The ACA affects Medicare and Medicaid products, Commercial or Employer Group, and the ACA agreed to financially support the insurance companies for members enrolling in their products. The ACA also had issues that led to several health insurance firms to struggle with finances forcing some of them to pull out of the market. According to statistics issued by Centers for Medicare and Medicaid Services (CMS), health insurers suffered losses of up to 4% of premiums (Hall & McCue, 2016). In addition to uncertainties of re-payment and insurance coverage which affects patient care, the overall healthcare system economically. With the insurers exiting the ACA markets, hospitals are forced to bear increased financial risks.

Recommendations

The year 2010 was when Congress enacted the ACA with several components not taking effect until four years later. Although the U.S. healthcare system is still not operating as expected, some measures have to be put in place to make it more efficient (Langer, Antonelli, Chamberlain, Pan, & Keller, 2018). Some of the recommendations include reinstating the power of product selection and authority of the healthcare system to respective states, employers, and consumers to decentralize the benefits.

Introduction

The ACA was meant to provide all U.S. citizens with the opportunity to purchase a healthcare policy irrespective of specific factors that were used to spurn coverage (Nguyen & Sommers, 2016). For example, insurers could decline to cover individuals with pre-existing conditions. The federal government subsidized policies to offset the liability and risks that the insurer will be exposed to by ensuring clients with conditions that involve high medical spending. Since the implementation of the ACA, the states have had less input on how the benefits of the plan were established, including the ACA's clause that required the states to expand their respective Medicaid offerings.

State Recommendation

Several states planned to commend cuts to the Medicaid programs, but the ACA prevented this in many ways in the bid to improve the American healthcare structure. Some of the suggestions to relieve the State and federal challenges with the ACA program are reinstating the power of product selection and authority of the healthcare system to respective states, employers, and consumers to decentralize the benefits mentioned earlier.

Overview of The Problem

Americans are living health, thanks to medical research and technology. As a result, there are Americans who consider health insurance as unnecessary since they are healthy and rarely need medical attention. On the other hand, those who require medical care frequently claim that insurance does not truly cater to their needs. Previously, hospitals used to take financial risks and burdens from the patients since they had no health insurance. Also, most Americans claimed indigent care due to their financial position. President Barack Obama and the U.S. Congress had to institute a program that would solve the challenges faced by consumers and organizations. Unfortunately, the ACA did not meet their expectations.

Review of Relevant Research

By examining the relevant research, we establish that the ACA concept was initially in the best interest of all Americans. Insurance companies no longer discriminated against some consumers due to their pre-existing conditions. Hospitals realized the importance of having more people being insured as there were fewer financial risks and liability. It is also evident that the objective of the ACA was to provide consumers with incentives by subsidizing the policies they purchased. The insurers received an offset payment for each individual who joined ACA. However, after the implementation, several healthcare insurance firms registered losses forcing them to pull out of the market. As a result, hospitals were once again exposed to financial risks. Many states were against the ACA policies as the Medicaid expansion burdens their financial reports.

 Application of Research Results

Applying the research results, it becomes a routine for court proceedings to start against specific elements of the ACA to ascertain whether the ACA was constitutional and genuinely addressing the needs of the Americans. For instance, in 2018, a federal judge in Texas ruled the entire program to be unconstitutional (Martin, 2018).    

Policy Implication

In the year 2013, a total of $84.9 billion in unpaid care was reported, in which 60% of that care was related to hospitals (Weissman, Cohen & Reich, 2017). These costs incurred by hospitals and can either be written off as bad debts, shift towards insurers, or sent for collection activities. The ACA program was created to reduce hospitals' financial burden, but the intended goals were not attained. The offset of costs impacted insurers negatively who were forced to recover by increasing their premium amounts, putting more burden on clients. The current policy’s negative implication can be reduced by reinstating the power of product selection and authority of the healthcare system to respective states, employers, and consumers.

Conclusion

Generally speaking, the ACA has strived to secure health insurance for Americans regardless of their financial or health status. Federal and state legislation leading to the withdrawal of insurers from the ACA market has also placed more burden on the hospital systems. Nonetheless, some changes can be made so that the needs of the hospitals are met. 

References

• Hall, M. A., & McCue, M. J. (2016). How has the affordable care act affected health Insurers' Financial performance? Issue brief (Commonwealth Fund), 18, 1-14.
• Langer, C. S., Antonelli, R. C., Chamberlain, L., Pan, R. J., & Keller, D. (2018). Evolving federal and State health care policy: toward a more integrated and comprehensive care-delivery system for children with medical complexity. Pediatrics, 141(Supplement 3), S259-S265.
• Larrat, E. P., Marcoux, R. M., & Vogenberg, F. R. (2012). Impact of Federal and State Legal Trends On Health Care Services. Pharmacy and Therapeutics, 37(4), 218.
• Martin, M. (2018). Affordable Care Act Court Challenge. Retrieved from https://www.npr.org/2018/12/15/677100866/affordable-care-act-court-challenge
• Nguyen, K. H., & Sommers, B. D. (2016). Access and quality of care by insurance type for low-income adults before the Affordable Care Act. American journal of public health, 106(8), 1409-1415.