From ACA to Medicare: 5 Answers to Healthcare Marketers’ Legal Questions About Insurance

As healthcare marketers and communications professionals, this swirl of forces hits close to home. Are you able to describe the various paths of reform to internal or external audiences?

In the spring of 2010, healthcare marketers saw the Patient Protection and Affordable Care Act (ACA), nicknamed ObamaCare, become law. It was the largest expansion of health insurance coverage since the establishment of Medicare and Medicaid in 1965. More than 50 years have passed since healthcare became more accessible, yet it remains a fiercely debated topic among politicians and is now the No. 1 concern among voters, according to a new poll from RealClear Opinion Research.

The tug-of-war between those who view healthcare as a guaranteed right and those who believe the government should have a minimal role is shaping up to be a driving force in the 2020 election. The processes used to “right-size” the government’s role shows we remain deeply conflicted. Court cases in different jurisdictions return victories and defeats to both sides. Voters generally approve Medicaid expansion when it’s on a state ballot, but elect federal representatives with divergent views. Why is this still so complicated?

The U.S., which has the world’s most powerful armed forces, spends 3.6% of its gross domestic product (GDP) on the military. Contrast that with the 18% of GDP spent on healthcare, and you start to get a sense of the scale of the industry and the Rubik’s Cube nature of how its pieces depend on each other. Those who view healthcare as a matter of seeing the doctor when you are sick tend to see the upside in expanding coverage. Those who think of it in economic terms tend to worry about potential disruption to jobs, given that healthcare is the largest source of employment in many towns. And those who view it as a commodity tend to think the marketplace should be left alone to sort it out.

As healthcare marketers and communications professionals, this swirl of forces hits close to home. Are you able to describe the various paths of reform to internal or external audiences?

  • The ACA (today’s status quo): For Americans who do not receive health insurance through their employer, the ACA removed restrictions on individual policies, such as exclusions for pre-existing conditions, lifetime limitations on benefits, and widely divergent premiums based on your health. Of course, the ACA also set up online exchanges where you could see if you qualify for certain subsidies to help you purchase different levels of gold, silver, or bronze coverage. Some people objected to the “individual mandate” that penalized taxpayers as a means of encouraging them to get coverage. Since its passage, the penalty for the mandate has been reduced to $0.
  • Single-Payer: Single-payer refers to the federal government reimbursing physicians and hospitals for services provided to patients, but doesn’t explicitly tie the reimbursement amounts to those of an existing program, such as Medicare or Medicaid. The uncertainty creates financial uncertainty for providers. Single-payer would, for the most part, eliminate the role of health insurance companies, which advocates believe would save money on administrative “waste” and opponents see as removing choice from the marketplace. Consumers who have “skimpy” health coverage might have more services covered under single payer, while those with richer benefits through commercial insurance might have fewer services covered.
  • Medicare-for-All (multiple flavors): Medicare-for-All is an expansion of an existing federal program accepted by almost all providers. Several proposals generally fall under the “Medicare for All” moniker, making it more complex to sort out. The name gives the impression the covered benefits would be similar to original Medicare parts A&B, but most proposals envision benefits like those available through Medicare Advantage, with benefits for vision, dental, and prescription drugs. Some proposals use traditional Medicare as a starting point for calculating reimbursements, while others use a more ambitious “global payments” approach for hospitals and standard rates for other types of providers. Consumers could purchase supplemental insurance to access services that are not covered. There would be no monthly premiums because tax revenues would cover costs. Medicare, Medicaid, and CHIP would be discontinued in favor of Medicare-for-All.
  • Medicare Buy-in: Medicare Buy-in is a smaller expansion of Medicare than envisioned under Medicare-for-All. This proposal would allow people 50 years old and over to pay a premium for the coverage provided under traditional Medicare or Medicare Advantage. The buy-in premium would be expected to cover 100% of administrative and benefit costs, although the enrollee may qualify for subsidies that bring down monthly premiums. Consumers could also purchase supplemental coverage, preserving a role for commercial insurance companies for that segment, as well as for younger consumers. Reimbursement rates for providers would mimic Medicare payment rates.
  • Universal Coverage: This is a goal rather than a pre-defined approach. As the name implies, Universal Coverage means everyone has access to healthcare, but it does not necessarily mean all services would be covered and it does not specify which of the above methods would be used to achieve it. In some countries, Universal Coverage also means that the government would control pricing, which critics say leads to an overall decline in the quality of care and advocates view as being more socially equitable.

As the debate over healthcare heats up — yet again — it may produce confusion and fear among people who have come to depend on specific programs, even if those programs have well-known flaws. Real change isn’t likely until after the 2020 elections, and the direction of that change will depend on who voters send to D.C. to represent them. In the meantime, be prepared to answer a lot of questions from worried patients.