Thursday, November 8, 2012

Obamacare Is Here To Stay – But In What Form?

President Obama's re-election, and the retention of a Democratic majority in the Senate, means that repeal of the Affordable Care Act is not likely, but no one is quite sure what implementation will look like. An NPR article discusses some possibilities.
January 1, 2014, is the date that major parts of the law, like the new insurance policies available to individuals and small businesses, are supposed to become available. The full timeline can be found here.

That doesn’t leave a lot of time to get ready, however. Many states and some key parts of the health care industry delayed gearing up much of this past year. Some say they assumed either the Supreme Court would rule the law unconstitutional, or Mitt Romney and a Republican Congress would be elected and make the law go away. Neither of those options happened.

In fact, there is a key deadline just days away.  By November 14, states must decide whether they want to run their own insurance exchanges, or whether they want to let the federal government do it for them.

Insurance exchanges are where people will go to shop for insurance coverage. They are also where people will get help paying for that coverage if they qualify for subsidies from the federal government. So far, only 13 states and Washington, D.C., have said they plan to set up their own exchange. If states decide not to set up their own exchanges, the federal government will step in and do it instead. But federal officials still haven't spelled out exactly how that will work.

Meanwhile, opponents of the law say that there are some problems with the underlying statute. The problem goes back to those subsidies that will help people afford coverage starting in 2014. The law authorizes subsidies for state-sponsored exchanges, but not for the exchanges picked up by the feds.  This raises concerns in some quarters that the health insurance markets are going to collapse and health insurance premiums are going to skyrocket because the subsidies are available only through state, and not federal, insurance exchanges.

Other experts contend that is not true. They point to cross-references within the statute that make it clear that the subsidies are meant to be available to everyone based on their income. This means the subsidies should be available whether the insurance exchanges are run by states or by the federal government.

With the election over, overturn of the Affordable Healthcare Act is unlikely, and attention now turns to implementation.   The healthcare law is here to stay, but it’s not clear what it will look like.

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