By Daniel J. DeNoon
On Tuesday, WebMD attended a roundtable discussion at the White House regarding the Affordable Care Act’s impact on women’s health. Today, we sought a response from Kathryn Nix, a healthcare analyst for the Heritage Foundation, a conservative think tank. Here’s what she had to say
The ACA and Healthcare Costs
White House Deputy Chief of Staff Nancy-Ann DeParle said that the biggest criticism of the ACA that contains the most misinformation is that “it does nothing to control costs.” As an example, DeParle points to Medicare spending per beneficiary now being the lowest it has ever been.
“The ACA does not control costs,” Nix says. “And it is important to ask whether changes in Medicare costs are due to the ACA, which has not yet taken full effect.”
Even if the ACA does result in lower healthcare costs, Nix says, savings to consumers will be offset by higher insurance costs.
“The requirement for all plans to cover essential health benefits is a cost driver,” she says. “As more benefits are included, plans will cost more.”
Young, healthy people will be hardest hit by higher health insurance premiums as older and sicker people flock to the plans, Nix says.
Mandated Health Insurance
The ACA would require everyone to buy health insurance. DeParle said that most Americans will not be affected by this requirement, and hence it is not “a huge new imposition on their liberty.”
Nix takes issue with that.
“It does not make a difference if things don’t change for most people. You don’t justify doing something that violates the Constitution simply because it doesn’t affect the majority,” she says.
Whether or not the ACA violates the Constitution is an issue currently before the Supreme Court.
Pre-Existing Coverage Insurance Plans (PCIPs)
These plans, now in effect, are intended as a bridge to 2014, when the ACA won’t let insurance companies deny coverage to anyone with a pre-existing condition.
Jeanne Lambrew, President Obama’s deputy assistant for health policy, says that while PCIPs are enrolling fewer people than had been expected, they are helping the sickest Americans.
Nix calls this a perfect example of what’s wrong with the ACA.
“It is more expensive than we thought but less effective — and insuring people with pre-existing conditions was one of the main reasons for passing the ACA,” she says.
Nix says the White House had expected 375,000 people to enroll in PCIPs. But so far, only 50,000 people have signed up, and that’s only after expanding the eligibility requirement.
“Enrollment has been abysmal compared to what they expected, but the cost per enrollee is 2.5 times higher than anticipated,” Nix says. “So when you’re looking at what we can learn from PCIPs, it’s that when people start getting coverage in health exchanges, the cost to taxpayers will be much higher and the programs will not help the number of people they said they would.”
No Lifetime Limits on Medical Benefits
DeParle noted that 105 million people are now benefitting from this provision of the ACA.
“This is part of the new insurance requirements that together raise the cost of insurance,” Nix says. “Tied closely to the ‘no lifetime limit’ is the ‘no annual limit.’ And a lot of employers now do this under the current, admittedly flawed system, just so they can afford to offer some insurance to their workers.”
Children with Pre-Existing Conditions
The ACA already forbids insurers to deny coverage to children with pre-existing conditions or due to their health status.
“We have seen some concerning consequences from this,” Nix says. “Seventeen states have reported that they had no insurers selling child-only policies to new enrollees. So right now you have that requirement that they cover everyone, but insurers wonder whether people will wait until their child is sick to acquire one of these policies.”
Coverage for Young Adults
The ACA already says that young adults up to age 26 can now stay on their parents’ plan as long as they don’t have insurance themselves through an employer. DeParle says 2.5 million more young adults now have coverage due to the ACA.
Nix says insurance coverage is up in all age groups, so many of those 2.5 million young people may well have acquired health insurance anyway.
But what happens when these young adults turn 26? Nix says that as the youngest and healthiest Americans, their insurance premiums will subsidize the cost of insuring older, sicker people.
“This solves the issue, but only for a limited time,” she says.
Drug Discounts for Medicare Recipients
The White House says that 3.6 million seniors with Medicare saved about $600 each in 2011 because of ACA-mandated discounts to fill the “donut hole” gap in Medicare Part D prescription drug coverage.
Nix admits that these 3.6 million seniors will pay less. But she argues that the net impact on all seniors is negative.
“This took $500 billion in cuts that decrease benefits and increase costs to seniors to create new programs for the non-elderly,” she says. “The costs to seniors under ACA outweigh the benefits.”
Applying Insurance Premiums to Health Care
The ACA says insurance companies have to spend at least 80% of the premium dollars they collect on actual health care costs. DeParle says this part of the ACA already is keeping insurance companies from raising rates as much as they would have.
Nix says some insurers, especially younger companies, have already dropped out of the health market because of this requirement.
And she points to the fact plans that incorporate health savings accounts have an easier time meeting this requirement. Plans without health savings accounts may spend more in some years than in others, and when claims are down they may have trouble making up for years when claims are high.
“This is one of many ways under ACA that Americans will not be able to keep the plan they now have — one of the biggest promises the President made about his healthcare plan,” Nix says.
Preventive Care without Co-Pays
One of the ways the ACA proposes to cut long-term health care costs is by making insurance companies cover preventive services without charging a co-pay. The idea is to prevent illnesses that cost more to treat than to prevent.
Nix says this means that preventive care that is now only recommended will soon be required.
“One of the biggest concerns is that these recommendations are meant to inform patients and doctors — but the decision whether to receive that service should be made based on the individual patient’s situation,” she says.
Nix also suggests that as more and more benefits are added to mandatory coverage, the costs of bare-bones plans will get higher and higher.
The Administration is defending the ACA requirement to include contraceptives among basic preventive services that plans must cover. Places of worship are exempt — but not religion-affiliated institutions, such as hospitals and universities.
“This means charities, hospitals, anything run by religious groups will be subject to penalties,” Nix says. “So will they go against what they believe in, or pay the penalty? Well, the penalty is expensive. They may go out of business. This will really hurt the poor who need these services, not to mention totally violating the religious freedom of these agencies.”
Premiums for Women
Beginning in 2014, the ACA makes it illegal to charge women higher health insurance premiums just because they are female. Lambrew says women now buying individual health insurance are paying some $1 billion more than men.
“Premiums will be going up under the law for everyone,” Nix says. “It will hurt women as much as it will hurt men.”