Thesis: In order to enhance the delivery of health services in the United States, the 2010 health care overhaul established and altered current health care programmes in the United States
- The health care scheme is a combination of private and public insurance systems and is one of the world’s most costly.
- The need for reform is seen to be by the loss of health care for almost one quarter of the population of the United States
- The aim of the law was to gain access to and increase the overall standard of health care in the region.
- The 2010 law aimed to introduce measures to ensure that the number of the uninsured in the country is significantly decreased.
- Insurance premium incentives and tax credits businesses will help extend coverage to many more people in the nation.
- Insurers would be limited to refusing or enforcing higher premiums
- Preventive treatment is provided in the law which lacks exclusions made for essential care.
- The latest law would continue to reduce the deficit significantly.
- The law would also reduce Medicare Advantage overpayments.
- The 2010 law would expand the availability and availability to health services to about 95 percent of the U.S. population, though potentially at the expense of higher taxes on corporations and high-income households.
Healthcare Reform in the United States
Health care reform is a term used to describe major health policy changes regarding healthcare delivery and the insurance associated with delivery in a given place. The health care system in the United States is made of a mixture of private and public sectors and is the most expensive in the world with $7,290 spent per person on health care cost (Centre for Medicare and Medicaid Services). According to a survey from the World Health Organization, the U.S. health care system ranked 37th in overall performance and 72nd in overall level of health among 191 nations reviewed in the study. Again, nearly 19% of the population (30 million) in United States was without health insurance coverage in 2010 (Congressional Budget Office). A new research has reported that more than 44,800 excess deaths occur annually in the United States, which can be attributed to lack of insurance (Wilper et. al). This were the driving forces that contributed to the transition in the restructuring of health care in the United States.
U.S. 2010 Health care reform tries to achieve the following goals:
- Expand the community who provides health care benefits by government schemes for the public sector or insurance providers for the private sector. This is to ensure that health care benefits are accessed by more persons within the country.
- Expand the number of suppliers of health services that patients can select from
- Enhancing access to experts in primary services
- Boost the general standard of health care treatment
- Providing more primary care facilities to the country’s people
- Lower the average cost of health care facilities
Key Elements of the 2010 Reform
The new health care reform in the United States is estimated to reduce the number of uninsured in the country from 19% in 2010 to 8% by 2016 (International Insurance News). The provisions made in the legislation will take effect by 2014. Following are some of the key highlights of the health care reform:
- Extend coverage through insurance mandate: The proposed act allows for insurance deductible and tax credit payments of up to 35 percent of premiums for the payment of health care coverage to employers. Those persons who are not covered by insurance provided by Medicare or employers will gain help through direct payments to buy insurance through a proposed online portal, an internet marketplace run by the state. This would increase market rivalry amongst insurers as well.
- Guaranteed issue and individual mandate: Unlike in the previous years, starting in 2014, insurers will not be allowed to deny coverage to sicker applicants or for small mistakes in insurance requests, enforce higher premiums, risk share, black-out times or terminate plans. The law will also require people, whose insurance plans do not meet a nationally approved minimum standard, to pay a tax penalty. This will almost resemble a universal health coverage common in many countries like United Kingdom, United Arab Emirates and Australia.
- Make Health Insurance more effective: The new legislation makes it compulsory for insurers to exclude lifetime and annual caps and cover more of a person’s health care cost. It ensures that first dollar costs are used for screening and immunizations and it also prevents exclusions made for necessary care. The legislation makes certain that insurance company overheads do not cost more that 15% of insurance premiums.
- Reduce the deficit: According to the estimations made by the Congressional Budget Office (2010), the reform legislation would reduce the deficit by $143 billion over 10 years. This will significantly help in revamping the health care system in the country.
- Eliminate overpayment in Medicare Advantage: According to the estimate made by MedPAC, Medicare was paying approximately $12 billion a year to the private insurers. That means that an average individual pays $90 a year under standard Medicare as a reimbursement to private insurers for which they did not get any benefit. It will save $177 billion over ten years to remove this overpayment (MedPAC.).
Advantages and Disadvantages of Reform 2010
- Advantages: Through this new legislation, nearly 95% of people who are legally staying in the United States can heave health insurance coverage (International Insurance News). Making insurance mandatory will bring younger and healthier people into the insurance pool at a relatively low incremental cost thereby reducing the cost for everybody else in the pool. A major advantage of this reform is that insurers cannot deny coverage or impose higher premiums for people having preexisting conditions or are very old.
- Disadvantage: To achieve the goals of this legislation, the government has to raise a significant amount of money which it might do by increasing taxes on businesses and high income families. Such expenditure from the government can strain the economy of the country. Also, citizens who do not whish to have a health insurance policy might have to pay 2% more taxes than others who opt for them.
- Centre for Medicare and Medicaid Services. National Health Expenditure Projections 2009-April 7, 2011 < https://www.cms.gov/NationalHealthExpendData/downloads/proj2009.pdf>
- Congressional Budget Office. The Reconciliation Proposal. April 7, 2011<http://www.cbo.gov/ftpdocs/113xx/doc11355/hr4872.pdf>
- International Insurance News. International Insurance and Healthcare Industry News. April 9,
- 2011 <http://www.globalsurance.com/blog/insurance-in-the-us-post-reform-258520.html> MedPAC. Executive Summary. April 7, 2011 <http://www.medpac.gov/chapters/ Jun09_ExecutiveSummary.pdf>
- Wilper, A.P., Woolhandler, S., Lasser, K.E., McCormick, D., Bor, D.H., Himmelstein, D.U.
- Health Insurance and Mortality in US Adults. American Journal of Public Health, 2009. 99(12).
- World Health Ooganization. Measuring Overall Health System Performance for 191 Countries. April 6, 2011 <http://www.who.int/healthinfo/paper30.pdf>