The patient protection and affordable care act popularly known as Obama care was signed into law by President Obama on March 23, 2010. A legal challenge was mounted by 26 State Governments. It was finally resolved in June 2012 when the Supreme Court of the United States handed down its decisive ruling.
It decided in favor of the Obama administration on nearly all the legal points of contention and most important of all upheld the so-called individual mandate provision of the law which compels every American to obtain health insurance or pay a fine. The Supreme Court ruled by a narrow 5-4 majority that the individual mandate was constitutional.
It also ruled by a 7-2 vote that the Federal Government could not force the States to expand medical coverage within their borders against their will. 19 states have opted in, and the other 31 states have opted out. For these 31 states the federal Govt will run the exchange.
Obama care’s support in the house was 219-212 and in the senate 56-44. It became a law without a single vote of the opposition party.
As per the decision of the Supreme Court it may be said that it is a blessing in disguise to the 19 States. In those states “Obama care has come to stay” even if the opposition party comes in power with the President from that party. The States would not be compelled to scrap it.
Essential Benefits
So far as the seniors from India are concerned the law does not directly affect them. In November 2012 the department of health and human services announced more details about the essential benefits that all the seniors would be able to enjoy. They would also get the benefit of increased funding for preventive services in Medicaid.
For those who currently receive Medicare benefits, the Obama care includes one significant improvement regarding the donut hole. It will finally close. The recipients by 2020 will have robust prescription drug coverage, regardless of how much they spend. However according to the Congress budget office hundreds of billions of dollars in funding for Obama care will be generated by cuts in Medicare’s budget over the next decade. President Obama and congressional Democrats have promised that the cuts to Medicare will not adversely affect services seniors have come to expect but at this point that is only their expectation not a guarantee and the worries of the seniors are justified.
For a senior citizen who has one or more chronic ailments and needs day to day assistance that means getting help both from Medicare and Medicaid. According to the Kaiser foundation, almost 10 million people receive both Medicare and Medicaid benefits. These so called dual eligible are the neediest Americans receiving government assistance. Very little attention has been paid to them.
Obama care seeks to change that and has promised to coordinate the delivery of benefits to this important group. We hope this promise is fulfilled. As fee for service facilities are restricted seniors would suffer. The doctors under restriction may avoid some necessary checks. That should be scrupulously guarded.
Senior citizens usually need more than basic Medicare, which covers only 60 percent of their medical expenses on average, the Medicare advantage plans. Lower income senior citizens secured additional coverage. In cutting Medicare advantage plan’s low income Americans are hard hit. These cuts could have been avoided.
Responsiveness
According to world health organization as regards responsiveness of national health care system, America is number one in rank. Does the doctor respect the patient’s dignity? Does a patient get prompt treatment? Etc. We are proud of our country’s system.
The question arises does our present system need change? The reply is “yes”. Among all 191 nations experts say France was rated number one and America number 37. In ranking for avoidable mortality we are at number 15, in quality and fairness of life we are number 37.On disability adjusted life expectancy (DALE) our rank is 24. With (DALE) life expectancy at70 years and with normal life expectancy of 77 in ranking for infant mortality rates, we have the highest mortality rates among ten developed countries 6.8 babies per 1000 die in infancy.
More than 20000 Americans die in the prime of life each year from medical problems that could not be treated because they cannot afford to see a doctor. Hundreds of thousands of Americans go bankrupt every year because of medical bills. Yet in 2005 our health expenditure as a percentage of GDP was 15.3 the highest among 13 developed nations.
Do these not call for fixing our broken health system?
From Theodore Roosevelt to Barack Obama half a dozen presidents have tried to fix up our health system. The last was Bill Clinton. All others have failed so far and there is a huge opposition from the Republican Party desiring to scrap the act altogether. It is true that all other developed countries (except China) have a manageable population. America with its 300 millions finds it difficult to change the system.
Basic question
We first have to answer a basic question. Should we guarantee medical treatment to everyone who needs it?
Do you feel that medical treatment is a privilege available to those who can pay for it? Do you feel that any attempt to give medical treatment to all would deprive many of the seniors the best treatment we need most? Do you feel that equality for medical treatment is only a platitude and impossible to put into action? If you think making medical treatment available to all would adversely affect the quality of the treatment to seniors and chronically sick ones then say no to Obama care.
If you feel that medical service is a public service like the fire department or the public library, public parks etc. go all out for Obama care. Be assured that you are with all developed countries of the west like France, Germany, United Kingdom, Canada, Switzerland and also with Japan and Taiwan. All these countries give free or at a very little cost equal medical treatment to rich and poor, young and old, women and children. An ethical question is involved.
America is not willing to do it because it is a strong capitalist country believing in democracy. In America the market rules the nation. We have to admit that America is the richest country in the world because of its market policy. Work hard, get rich and enjoy the benefits of prosperity even in the medical field. The rest of the developed countries do not subscribe to this philosophy.
Four Models
There are four models in the world for medical benefits:
(1) The Bismarck model. It is found in Germany, Japan, France, Belgium, Switzerland and to some degree in Latin America.
(2) The Beveridge model. It is followed in United Kingdom, Italy, Spain and most of Scandinavian countries. Hong Kong, Cuba and in the US Department of Veteran Affairs.
(3) The national health insurance model. Canada, Taiwan and South Korea follow this system
(4) The out of pocket system. All poor countries where there is no established health care system follow this model
The salient points of these models are as follows:
• In Bismarck countries both health care payers and providers are private entities. There are private insurance plans usually financed jointly by employers and employees through payroll deductions. They cover everybody and do not make profit. Tight regulations of medical services and fees give the system much of the cost control clout.
• In the Beveridge model, health care is provided and financed by government though tax payment. There are no medical bills. It is a public service.
• In the national health insurance model, the providers of health care are private but the payer is the government run insurance program financed by monthly premiums
• In the out of pocket system, the basic rule is simple and brutal. The rich get medical care: the poor stay sick or die.
Best of all Systems
The Obama care has taken the best of all the systems to an extent that suits the rich American nation.
Why are we reluctant to follow the best of these systems?
America feels that the foreign approaches would never work here. There are five American myths about health care systems overseas
(1) It is all socialized medicine out there.
(2) They ration care with waiting lists and limited choice.
(3) They are wasteful systems run by bloated bureaucracies.
(4) Health insurance companies have to be cruel
(5) Those systems are too foreign to work in USA
There are two main reasons for America ignoring these systems.
(1) American exceptionalizm.
(2) The vested interest of Insurance companies, Drug manufacturing companies and Wall Street. They are interested in the status quo. Americans are coming to realise that the other rich countries are getting more and better medical treatment for less money than we do. The powerful institutions backed by Republican conservatives would fight tooth and nail to keep the system as it is.
The developed countries of the West and Japan make fun of us. The number one country has no place in various health reports by world health organization and other Harvard reports. They say no doubt America is top in per-capita expenditure and spends highest per individual.
The medical systems in other countries are not perfect and the people of those countries are not fully satisfied.
In British parliament both Tony Blair and his successorGordon Brown silenced the opposition to British health care system, by saying “the honorable gentleman opposite clearly hopes to turn our health care system into a profit making corporate enterprise as the Americans have done. This we will never do.”
We have read above much of the systems of other countries. Now coming to Obama care, our own health system. Even if we demur at foreign systems we are following the Bismarck system for people under 65. Both the worker and the employer share the premium for the health insurance policy. The insurer picks up most of the expenditure for treatment with the patient either making a co-payment or paying a percentage.
For native Americans, military personnel and Veterans we follow British system. The doctors are Govt employees working in Govt owned clinics and hospitals. Americans in this system never get a medical bill. The Indian health service also provides free care in government clinics. The people over 65 getting both Medicare and Medical are to some extent covered by Beveridge model.
For those who are over 65 and not covered by Medical, we are following Canadian methods. Americans with end stage renal diseases regardless of age are also covered by Medicare. The “dialysis community” has opted for coverage under Govt run scheme.
For the 45 million uninsured Americans we follow the out of pocket system. If you are rich pay for medicine, if you are poor stay sick or die.
Republican Opposition
We have to understand why rich Conservative Republicans oppose Obama care. The excise tax on Cadillac Health care plans are to be taxed 40 percent, $10200 for individuals and $27500 for families. So far they used to get very excellent type of treatment paying out of pocket and claiming income tax relief. This has been stopped. If Obama care survives into 2020 the tax on Cadillac plans is likely to become the biggest revenue source.
Why the insurance companies are in such big opposition? So far they spent a big part of their premium in finding out ways and means how to deny coverage. Now they cannot refuse to take insurance for existing bad health conditions, they cannot increase insurance premium and they cannot cancel insurance policies.
They are worried that if only such sick people take insurance and healthy people do not, they will not be able to maintain 80-20 loss ratio. The loss ratio is a peculiar requirement. As per their requirement all premium they receive is 100 percent, if no claim is paid. When the claim is paid the 100 percent would come down to the extent of payment.
They would not permit the loss ratio to go above 80 percent. They move heaven and earth to employ lawyers to deny the payment on flimsy grounds.The author of the famous book “Healing of America” T. R. Reid quotes how American insurance company denied his claim, because the claim was sent to the company in foreign currency. They wanted the claim to be submitted in American currency. Because of the denial requirement their administrative expenditure is very huge.
However the insurance and drug companies are given a carrot. When health insurance is mandatory, 30 million more policies have to be issued and the insurance and drug companies would find it difficult to meet with the demand. Even with a slight amount of profit for each insured and drug buyer the insurance companies hope to make millions.
Four Types of Polices
There are four types of polices, the Bronze, Silver, Gold and Platinum with various rates of premiums to be paid and out of pocket expenditure. Most of the seniors are covered by Medicare-Medical. Out of the remaining a good number is at present coved by Medical alone but the coverage is almost 100 percent.
There are two worrying points. One is the question of global assets. The original Obama care rules required seniors over 65 to consider their assets. It was also specified that green card holders will not get Medical up to 5 years after they get green card. As both these restrictions are not compatible with Obama’s individual mandate that all should be covered, those with assets and green card holders have to be put somewhere. With the limited income they would get the benefit of extended medical.
California covered website gives details of the system in California. There is no use repeating it here.
Stay Alert
Though our seniors have not to be worried they have to be alert and they should study the various rules of Obama care as they need to make extensive use of the preventive services.
“Obama care hopes that the health care scheme would bring sizeable revenue to the federal govt. The seniors should be watchful to find out the sources from which Obama care hopes to get revenue at the expense of seniors.”
The seniors over 80 have to be watchful. If they find that the doctors take their ailment as a sign of old age and ask them to bear them, the matter should be brought to the notice of medical department and media. This is likely to happen in most cases. Rather than spending huge amount in surgeries and in post surgeries on an aged individual just enabling him or her to live a year or two more, the health provider is most likely to ask the seniors to concentrate on religious practices and wait for the inevitable hour. We have to resist that.
It is a moral question that all rich or poor, young or old citizens or green card holders sick or healthy should get health care free or at a very affordable cost. We seniors may help Obama care to succeed.
It is unavoidable that when the cake – however large – sharers are increased, each will get a little less. That should be welcomed with equanimity.
Harikrishna Majmundar is President South Asian Senior Services, Palo Alto CA.
Harikrishna Majmundar
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