The document discusses the impacts and future of the Affordable Care Act, including that it will increase health care costs, many will lose their current health insurance plans, and there is widespread pushback against the law from doctors, employers, and states who argue it will have negative economic consequences. The document also outlines ongoing legal and political challenges to the law.

1. A not-for-profit
health and tax policy
research organization
Health Reform:
What it means.
What’s next?
Grace-Marie Turner
April 24, 2012
Kentucky Association of Health Underwriters
/GalenInstitute
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8. Americans’ views
of Supreme Court decision
• 25% think the law should be upheld in full
• 38% would like the entire law thrown out
• 29% would like the court to strike down the
individual mandate
• 39% support health care overhaul in general
Source: Washington Post-ABC News Poll, April 8, 2012, http://www.washingtonpost.com/wp-srv/politics/polls/postabcpoll_04082012.html.

9. Americans agreed on goals for health reform…
• The U.S. needs health reform to:
– make coverage more affordable
– assure quality, and
– expand access to insurance
• Most people rate their own coverage as
good or excellent
• They want stability. Change is for
others.
www.galen.org

10. Do you think the health care reform plan that
Congress passed recently will increase, decrease,
or have no effect on each of the following:
Taxes
Federal Deficit
Health Care Costs
Insurance Premiums
Health Care
Quality
Source: AM&A, Resurgent Republic 1st Anniversary Survey of Likely Voters, April 25-27, 2010

11. Early changes from the law
• Medical Loss Ratio
• Grandfathering rules
• “Free” preventive care
• Allowing “children” up to age 26 on
parent‟s policies
• No annual or lifetime limits on coverage
• Pools for pre-existing condition policies
• $250 for seniors with high drug costs
www.galen.org

12. The health law’s main features
• Expands coverage to 30 million uninsured
• A new system of Exchanges to deliver subsidies
• States required to expand Medicaid
• Citizens required to purchase approved health insurance
• Most employers required to offer coverage
• Significant new federal regulation of the health sector
(with 159 new regulatory agencies and programs)
• Medicare cuts and changes
Financed by
• $575 billion in payment reductions to Medicare
• $550 billion new taxes and penalties
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14. A not-for-profit
health and tax policy
research organization
/GalenInstitute
www.galen.org

16. New taxes and fees in the health law

17. Studies show law fails to meet goals
• Health costs and health spending increase
• One-third of businesses may drop insurance
• Young people worried about high cost of
policies
• Doctors concerned about Medicaid
expansion and fraying the safety net
• Seniors are concerned about access to care
through Medicare and Medicare Advantage
• Up to 25 million will remain uninsured
www.galen.org

18. Higher Costs
• Insurance rising 9% to $15,000/yr in 2011
• Foster: “False more so than true” that law
will lower costs for taxpayers
• Latest CBO cost estimate:
$1.76 trillion/10 yrs
• Gruber: Premiums up to 30% higher than
without the law
Congressional Budget Office and the Joint Committee on Taxation, “An Analysis of Health Insurance Premiums Under the Patient Protection and Affordable
Care Act,” November 30, 2009, www.cbo.gov/ftpdocs/107xx/doc10781/11-30-Premiums.pdf. Chief Medicare Actuary on President's health care claims: "I would
say false, more so than true,“ House Budget Committee, January 26, 2011, http://www.youtube.com/watch?v=XC9rhGWJA2w. “2011 Employer Health Benefits
Survey,” Kaiser Family Foundation/Health Research & Educational Trust, September 27, 2011, http://www.kff.org/insurance/092311nr.cfm.

19. “If you like your health insurance…”
• 51 to 80% of Americans will lose current
coverage, according to Obama admin. estimates
• CBO: Up to 20 million could lose job-based plans
• McKinsey: Up to 80 million will be forced to
change policies
• Child-only policies will vanish in 17 states
• 35 million more will move from job-based
insurance to taxpayer-subsidized exchanges
“Fact Sheet: Keeping the Health Plan You Have: The Affordable Care Act and „Grandfathered‟ Health Plans,” U.S. Department of Health and Human Services, HealthReform.gov,
http://www.healthreform.gov/newsroom/keeping_the_health_plan_you_have.html.
"CBO and JCT's Estimates of the Effects of the Affordable Care Act on the Number of People Obtaining Employment-Based Health Insurance," Congressional Budget Office, March 2012,
http://www.cbo.gov/publication/43082.
Shubham Singhal, Jeris Stueland, and Drew Ungerman, “How US health care reform will affect employee benefits,” McKinsey Quarterly, June 2011,
www.mckinseyquarterly.com/Health_Care/Strategy_Analysis/How_US_health_care_reform_will_affect_employee_benefits_2813.
“Health Care Reform Law‟s Impact on Child-Only Health Insurance Policies,” Senate Committee on Health, Education, Labor and Pensions, August 2, 2011,
http://www.help.senate.gov/imo/media/doc/Child-Only%20Health%20Insurance%20Report%20Aug%202,%202011.pdf.
Douglas Holtz-Eakin and Cameron Smith "Labor Markets and Health Care Reform: New Results," American Action Forum, May 27, 2010,
http://americanactionforum.org/sites/default/files/OHC_LabMktsHCR.pdf.
www.galen.org

20. Independent Studies
Obama administration actuary Rick Foster:
• $120 billion in fines for companies and individuals
• Government spending will increase by $311 billion
• Many on Medicare will have trouble getting care
CBO:
The law will raise some family premiums by
$2,100 in 2016 above what they would have
been without the reform law
Richard S. Foster, Chief Actuary, “Estimated Financial Effects of the Patient Protection and Affordable Care Act, as Amended,” U.S. Department of Health and Human
Services, Centers for Medicare & Medicaid Services, Office of the Actuary, April 22, 2010, www.cms.gov/ActuarialStudies/Downloads/PPACA_2010-04-22.pdf.
Congressional Budget Office and the Joint Committee on Taxation, “An Analysis of Health Insurance Premiums Under the Patient Protection and Affordable Care Act,”
November 30, 2009, www.cbo.gov/ftpdocs/107xx/doc10781/11-30-Premiums.pdf.
www.galen.org

22. Widespread pushback
Very real consequences
• Killing jobs, especially decimating the insurance broker
community
• 40% of doctors plan to leave practice
Resistance from states
• Lawsuits to block individual mandate, Medicaid expansion
• Balking at setting up exchanges or otherwise complying
Impossible complexity
• CLASS Act collapse
• Enormous bureaucracy, benefit mandates, privacy issues
• 12,000 pages of regulations — so far
www.galen.org

23. Push-back coming from
• Doctors and patients
Losing control over medical decisions
• Small businesses and big employers
New taxes, penalties, and mandates
• States
Higher costs for Medicaid
• Consumers
Higher costs for insurance and fewer choices
• Seniors
Cuts to Medicare
www.galen.org

24. Employers’ fears
• Coverage mandates, impacting job creation
• Benefit mandates that drive up costs
• Businesses must learn “household”
income of employees to avoid fines
• Low-wage jobs vanishing
• Impossible to comply with grandfathering
rules
One-third to half of employers consider
dropping coverage altogether — McKinsey
www.galen.org

25. Some realities
www.galen.org

26. Who said this?
“You should never try to tell people what they
ought to do because all of their circumstances
are different.
“But if you give them very good timely
information, they are going to make their own
decisions in ways, in general, that are going to
be better for them and better for the system as
a whole.”
― Ron Kirby, transportation planning coordinator for the
Metropolitan Washington Council of Governments
Source: Ashley Halsey III and Ed O‟Keefe, “Earthquake illustrates colossal challenge of evacuating Washington, D.C.” The Washington
Post, August 24, 2011.

28. Sources: AHIP Center for Policy and Research, U.S. Census Bureau.

29. Health care in 2012
• Legislation
Challenges to the law: 1099, CLASS and
IPAB
• Regulation
12,000+ pages so far
• Legal
U.S. Supreme Court decision in late June
• Political
2012 campaigns and elections
www.galen.org

30. Europeans going the other way
• Consumerism
• Value of private enterprise
and competition
• Doctor-patient relationship
• Decentralized
decision-making
www.galen.org

31. Opportunities ahead
• This is not settled policy
• Major election before implementation
• States will have a big say
• This law will be changed, likely significantly,
if not repealed outright
The American people want private insurance,
and they want to be in charge of choices.
Freedom. Innovation. Access.
www.galen.org

32. Why ObamaCare Is Wrong for America
How does the health care law
drive up costs?
Is your doctor really in charge of
your health care decisions?
Are your Constitutional rights
threatened?
Discover the law’s impact on
your life in a new book from
four nationally recognized
health policy experts
Published by Broadside Books,
an imprint of HarperCollins www.WrongForAmericaBook.com
www.galen.org

33. Grace-Marie Turner
A not-for-profit
health and tax policy
research organization
Galen Institute
703-299-8900
gracemarie@galen.org
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