by Richard S. Bernstein on Feb 2, 2018

Healthcare, obamacare, health insurance

By: Richard S. Bernstein & Brent Schillinger, MD

As we enter 2018, many people believe that Obamacare has been rescinded, but in fact, it seems to be very much intact. In spite of some last minute directives from Washington, the insurance continues to be in full force.

Americans who want to be covered by Obamacare must actively sign up. During the most recent enrollment initiative at the end of 2017, the federal government cut the sign-up period from twelve to six weeks, and slashed much of the funding previously used to promote enrollment. The final 2017 numbers won’t be in for a few months, but the preliminary data shows that on a national level, the 2017 enrollment appears to be fairly close to the figures from the prior years.

The law was passed in 2010 and went into effect in 2014. It has had major impact on the individual insurance market. Most significant, insurance companies selling policies on the individual level must charge the same rate and accept all applicants regardless of pre-existing conditions. There has been no change in this provision for 2018.

Obamacare also provides various subsidies to make the insurance more affordable, particularly for low and middle-income households. Cost Share Reduction (CSR) is a discount that lowers the amount an enrollee pays for deductibles, copays and coinsurance. CSR was eliminated by presidential executive order in October 2017. Anticipating losses with the CSR gone, Obamacare insurers in Florida raised 2018 premiums. Then a second Obamacare subsidy automatically kicked in that reduces premiums. Doing the math with the elimination of CSR, the federal government ends up spending more money in Florida than it would have otherwise.

On the patient level it gets more complicated. The second subsidy keeps premiums low enough so many Floridians can still afford the policies, but they might not be able to afford the actual health care. With the lack of CSR when you go to the doctor, you may find yourself in for a very big surprise with a much higher copay and deductible. Dr. Schillinger’s office has already seen outraged Obamacare patients when they learn that the copay that used to be zero is now as high 75 dollars or more per visit.

That brings us to the very important question of how to drive down the cost of healthcare and insurance plans. One suggestion would be to allow companies to offer the 2010 pre-Obamacare plans that were much more affordable. This would include fewer benefits, but companies should be allowed to make that choice. Another suggestion would be to remove the hidden taxes in Obamacare. They were intended to be a tax on the healthcare industry in general, but the taxes were met with one-to-one price increases of services, which were passed down to the consumer. Another area we should focus on is the price of drugs. One suggestion would be a favorable interest clause where the U.S. would buy drugs at the lowest price they are sold globally, but there’s also room for the FDA to change rules that would allow generic alternatives to enter the market faster. There is also promise in “biosimilars,” which are molecules that have similar effects as a drug, but are not exact copies of said drug. The issue of pre-existing conditions should also be addressed by removing it and replacing it with a onetime sign-up period that would allow those with pre-existing conditions a chance to join the insured pool.

Health care in the United States continues to be complicated. I’m hopeful our government will better address the real issue, not so much the cost of insurance, but the skyrocketing costs of health care itself. It looks like Alex Azar will be the new secretary of Health and Human Services. As past president of Lilly USA, he is an insider for sure. With his inside knowledge perhaps he will have some innovative ideas to make health care more affordable.

Brent Schillinger, MD is past president of the Palm Beach County Medical Society.  Currently he is chair of the medical society's Opioid Task Force.  Dr. Schillinger served as chair of the Council on Ethical and Judicial Affairs for both the Palm Beach County Medical Society and the Florida Medical Association.  He represents the medical community on the Ethics Partnership Council at Palm Beach State College.