11th Circuit Court Strikes Down Mandate

Much of the news related to healthcare last week focused on those headlines.  Those who have consistently argued that the Health Care Reform act is bad policy hailed the circuit court’s decision as a victory.  Those who  believe in the mandate that every American have access to and be motivated to buy health insurance, decried the decision as just another example of “kicking the can down the road”.

So who is the real winner?  The real loser?  It depends on who you ask (and whether the respondent already has insurance) and on who is taking care of the uninsureds’ health needs. The provider community continues to be stuck with providing care to the uninsured, the cost of which is estimated to exceed 40 billion dollars per year, at last count.  The tax payer, you and me, doesn’t benefit by this ruling because ultimately that 40 plus billion comes out of our pockets in the form of higher insurance premiums and higher bills from the hospitals and the practitioners (it is called cost shifting).

And, believe it or not, it also impacts the cost of providing care under Medicare, because if I am an uninsured individual who does not seek healthcare unless it is an emergency—by the time I am eligible for Medicare I tend to be sicker than my insured counterpart and consequently my cost to Medicare will be significantly higher. Not a good situation, given that the Medicare ranks will swell by some 76 million people over time. Even if we account for a certain portion of Medicare eligibles dropping from the rolls due to death, without significant changes to how we finance and deliver healthcare, Medicare will become the single most costly program in the history of this country – and most of us will be around to see it and suffer under it.  

In my last blog I talked about how a financial approach to solving the healthcare crises in the US is, at best,  a short term approach akin to sweeping the problem under the rug (the “kick the can” analogy comes to mind one more time).

As an example, let’s focus on the Medicare-eligible individual for the moment, to illustrate why a financial solution is not going to solve the problem. Assume that Medicare funding is cut across the board (that is exactly what is anticipated if the debt ceiling super committee cannot get its act together). The impact of such cuts?  Providers are paid less (some suggest that they should be paid significantly less), which could result in primary care physicians and specialists closing patient panels to new Medicare patients; inpatient and other allied healthcare providers raising rates to balance out the cuts; and the individual Medicare-eligible exhausting their savings more quickly due to higher out of pocket costs.  That in turn will lead to greater reliance by those individuals on other community services such as food stamps, Medicaid, state funded social and aging services, which will in turn drive up those expenditures and create significant budget issues in those programs.

By now you are probably thinking that this is just rambling with no real end purpose. Not really.

My point is that decisions  we make in the healthcare field have far reaching consequences, whether they are made in a physician’s office regarding how to treat a particular pathology, or whether they are made at the national policy level.  Isolated decisions such as striking down the health insurance mandate set into motion a series of events, the impacts of which may not be felt for years, but can be very damaging once they become apparent. 

No one disputes that the current health care reform has significant failings. This writer is amongst those who decried the process as well as the outcome. But irrespective of political leanings or philosophical differences, the Affordable Care Act  and its emphasis on tying future  provider reimbursement to better conceived approaches to patient communication, treatment and access is much better than the potential for an arbitrary cutting in healthcare financing as part of resolving this nation’s debt crises.

All of us; providers, payers, healthcare industry professionals and patients, have a vested interest in reengineering our approach to health services delivery and financing through logic and rationality. After all, we will be customers of the system sooner or later. At that point in time,  I for one would like a say in what I experience.