The Patient Protection and Affordable Care, Research Paper Example

The Patient Protection and Affordable Care Act (ACA) is a new law initiated by President Barack Obama on March 23, 2010.  The ACA was upheld by the Supreme Court on June 28, 2012.  This act is meant to ensure that all Americans have health insurance, making it more affordable and accessible. However if Americans choose not to have health insurance, they will pay a financial penalty. By January 2014, all Americans will be required to have health insurance, whether through work, government assistance, or independently purchased. Opinions are divided on whether the ACA will be beneficial or detrimental to the economy and health care. Some Americans support the ACA, while others view it as unconstitutional and expensive. The purpose of this paper is to examine if the outcome of the ACA will have a positive or negative effect on the economy and health care.

According to the American College of Physicians (2011), the ACA requires that all Americans must have “minimum essential coverage” of health insuranceor face a financial fine.If coverage is not provided by their employer or by public assistance, Americans must pay from their personal funds.

Potential Negative Impacts with the Affordable Care Act

Many Americans are concerned about the potential negative impact that the ACA will have on America’s health care system. By forcing Americans to purchase a product, many feel that this act is unconstitutional.  In his 2008 campaign, President Obama promised not to raise taxes on individual citizens who made less than $200,000 a year and couples making less than $250,000.Many Americans make far less than $200,000 and cannot afford insurance, yet do not qualify for government assistance.

According to the Congressional Budget Office (CBO) and the Joint Committee on Taxation (JCT) (2012), it is estimated that 6 million people will be forced to pay a tax penalty because they will not have health insurance.The CBO calculates that 30 million residentswill not be insured by 2016; though most of these individuals will be exempt from paying the penalty. This estimate was made in April 2010, and the numbers of uninsured Americans is expected to increase.  The CBO’s updated prediction is that an additional two million Americans per year will be forced to pay the penalty.The 15% increase is due to higher unemployment rates, lower wages, and the Supreme Court’s recent decision regarding the further expansion of Medicaid coverage.

As part of the ACA, Medicaid coverage will expand to include health care for a greater number of people.However, individual statesmay choose not to participate in this new policy and not face a penalty.States cannot reduce coverage and they must continue to honor all existing plans with the same funding.  The Medicaid portion of the ACA will increase taxes overall and Americans who do not meet the criteria for exemption or assistance will be expected to pay.

A major concern is the impact that the ACA will have on the middle class.  Often, individuals in the middle class do not qualify for assistance, and their limited incomes make it difficult to afford health insurance.  Eighty percent of Americans who would have to pay the penalty would be making $55,850 or less for individuals and $115,250 or less for a family of four. The CBO estimated that the average financial penalty would be $1,200 per household, amounting to $6.9 billion overall.Taxes in general may have to be raised due to the increased amount of Americans applying for government assistance.  This could further widenthe gap between the rich and the poor.

The ACA will force more employers to provide satisfactory health care coverage for their employees.  Higher unemployment rates could result because employers may not be able to hire and retain as many employees.  There is also a concern for the fate of small businesses.  Even though they often do not have the same financial resources as large corporations, they will still have to provide health insurance to full-time employees.

The ACA does grant exemption for some Americans who may not be able to afford health insurance. People who have been uninsured for less than three months, whose income does not meet the threshold for filing taxes, and for those whom health insurance would exceed 8% of their income would not have to pay a penalty.  Others who would be exempt from the financial penalty are those with religious objections, Native Americans, incarcerated convicts, and illegal immigrants.

Direct Impact of the Affordable Care Act on Health Care

Negativeconsequences of the ACA may extend beyond financial concerns.  When health care is enforced in more socialized systems, often the quality is diminished.  Patients may be limited as to whom they may see as a health care provider.For many Americans, insurance companiescurrently dictate both the choice of physician and the extent of care that the patient is able to receive.  Some Americans feel that by allowing the government greater control, the ACA may further limit the quality of care.

Another aspect of concern is how the ACA will impact physicians.  If the ACA restricts the overall income of physicians, many may not be able to afford to continue to practice. Student loans, medical malpractice insurance, and continuing education requirements are just some of the expenses that physicians are obligated to pay.  In order to continue to practice medicine, many physicians and other health care providers must see more patients in less time, which can decrease the overall quality of care received by the patients.  The ACA could either exacerbate or eliminate this problem with insurance companies and physicians.

Potential Positive Outcomes of the Affordable Care Act

Despite the potential negative impacts of the ACA, this act could be very beneficial for many Americans.  The ACA may help to protect Americans from the insurance companies and ensure that they receive sufficient health care.  Insurance companies will be held responsible for actions such as improper spending, cutting costs, and denying people adequate coverage. With the ACA, insurance companies will no longer be able to discriminate against those with pre-existing conditions. Children with pre-existing conditions, such as asthma will no longer be denied treatment.

Another potential benefit to this act is that it prevents insurance companies from limiting the amount of coverage provided to patients.The ACA will prohibit insurance companies from terminating financial coverage for those receiving treatment for chronic diseases when their coverage runs out.  For example, cancer patients will be able to receive their treatment uninterrupted without the insurance company deciding to end their coverage.  Insurance companies will no longer be able to terminate coverage for people who become ill and claim the termination is due to technical errors.

Though the government is forcing citizens to obtain healthcare with the threat of a financial penalty, the ACA promises that healthcare will become more affordable to Americans.  Overall costs are to be reduced and insurance companies will be prevented from raising their rates greater than 10 percent without providing a public explanation.  Insurance companies will also be required to pay for preventative care, such as mammograms and prostate screenings.

Other beneficiaries of the ACA include young adults, Medicare recipients, and small businesses.  Young adults will be able to remain on their parent’s plans until they are 26 years old. Medicare recipients will benefit because the bill will help to fight fraud, lower prescription costs, and provide greater preventative care.  Even though more employers will have to purchase plan to provide employees with health insurance, the ACA does take the limited financial resources of small businesses into consideration.  Small businesses will be given a tax credit for providing their employees with health insurance.

Even if Americans decide to neither purchase health insurance nor pay the tax fine, they will not face the penalty of incarceration. They may simply be subject to outstanding tax fines and other legal issues.

The impact of the ACA on the economy and health care could be either positive or negative.  Though the ACA does promise to benefit the majority of Americans, a significant number will still be penalized. It is important to consider the ethics of forcing Americans to purchase any product regardless of the potential benefits.  Though it may be too early to determine, the issue will have a definite impact on the presidential elections in November, 2012.  To prevent confusion and potential problems, uninsured Americans should first find out if they qualify for exemption or assistance.Those who do not qualify may be forced to choose between paying the high cost of health insurance or the high cost of the tax penalty.

References

A more secure future: What the new health care law means for you and your family. (2012). Retrieved from http://www.whitehouse.gov/healthreform/healthcare-overview#healthcare-menu

Elmendorf, D. W. Congressional Budget Office, (2012). Payments of penalties for being uninsured under the affordable care act . Retrieved from website: http://www.cbo.gov/sites/default/files/cbofiles/attachments/09-19-12-Indiv_Mandate_Penalty.pdf

Tax penalties for individuals who do not purchase coverage. (2011). Retrieved from http://www.acponline.org/advocacy/where_we_stand/access/internists_guide/vi6-tax-penalties-individuals-who-do-not-purchase-coverage.pdf