2012 Election Coverage – Healthcare

This is the first installment of the Pulse’s election coverage. We pick a topic, break it down and highlight candidates’ positions so you see why your vote matters.

This week – healthcare. Next week – education.

No matter who gets voted into office this November, America’s healthcare system is going to change.

The system as it exists now is unsustainable. The costs of healthcare keep rising at a rate that far outpaces inflation. Millions of uninsured Americans put off care until it’s too late for anything but extreme, and expensive, action that’s subsidized by those who have insurance. America spends more per person on healthcare than any other country does, but our system doesn’t produce better results.

To try and combat this problem, President Barack Obama advanced the Patient Protection and Affordable Care Act (PPACA), aka Obamacare.

Among other things, the PPACA was designed to extend insurance to as many Americans as possible. Part of the way it does this is by requiring those who can afford private insurance to purchase it by 2014 or pay a penalty, a provision known as the “individual mandate.”

The bill also creates new insurance options for several groups (including the poor, dependents, and those with pre-existing conditions), requires employers with more than 50 full-time employees to offer affordable insurance or pay a penalty, and creates state-run health insurance exchanges where people can shop for competing private insurance plans.

“It will tend to make more people eligible for coverage for healthcare, which in general for much of society is a good thing, in a sense that you’re not having people walk in for care with no coverage at all,” says Roger Tepe, Director of the Door County Department of Social Services. “The hospitals and clinics are doing less charity care, which means the rest of us are not subsidizing all [those people]. It tends to kind of take the edge off the growth of healthcare costs.”

Projections from the Congressional Budget Office say the insurance coverage provisions of the PPACA will result in a net reduction of $84 billion in federal spending between 2012 and 2022, with even more savings coming from the other portions of the bill.

Forty-six percent of those surveyed in a July Gallup poll said the PPACA would hurt the national economy, while only 37 percent said the law would help the economy. Some worry the bill puts too much pressure on businesses, especially those who would like to expand past the 50 employee mark but can’t as they’d have to provide insurance.

Others take issue with the “individual mandate,” saying the government should not be able to coerce people into buying insurance. According to the Pew Research Center for the People & the Press, 70 percent of Republicans disapprove of the Supreme Court’s decision to uphold the PPACA, while 66 percent of Democrats approved of the decision. Among independents, 42 percent disapprove of the decision and 32 percent approve.

Others support the bill’s intentions but are concerned it won’t function as designed.

“When the Affordable Care Act was being promulgated the American Hospital Association jumped on board and supported it because there are big cuts in payments for the hospitals, but in exchange for that they were going to have more of the uninsured covered. That would then make up for the cuts,” says Jerry Worrick, CEO of Ministry Door County Medical Center. “There are concerns that’s not going to work out the way it was planned because there is really no penalty if you don’t get coverage for health insurance.”

Individuals without insurance by 2014 will pay an annual penalty of $95 or 1 percent of their income, whichever is higher. The penalty gradually rises to $695 or 2.4 percent of income by 2016, according to Kaiser Health News.

The 2012 crop of Republican candidates have vowed to make repealing the PPACA and replacing it with their own healthcare reforms a top priority if they gain control of the legislature and the presidency.

A Republican healthcare reform plan would do away with the “individual mandate” and state-run exchanges and focus on streamlining regulations on insurers, providing tax credits to those without insurance rather than expanding government programs, and encouraging individual states to enact their own healthcare reforms.

No matter who wins the elections, however, it’s unlikely that repeal of the PPACA would mean the end for the entirety of the bill. The particular provisions that would remain are unclear.

“We’re concerned that [the PPACA] may be eroded to some degree, but just how much isn’t clear,” says Tepe. “Republicans are saying they’d keep parts of it or if they follow through with their pledge to ‘repeal and replace,’ they’d put parts of it back in.”

The Future of Medicare

The other big talking point for this election is Medicare, the government’s insurance plan for those over 65 or living with disabilities.

“There are major issues that have to be addressed,” says Worrick. “Right now, the average Medicare recipient pays $150,000 over their working life into the Medicare fund. The average senior collects anywhere between $250,000 to $350,000 in benefits. It’s not a sustainable system.”

Under the proposed federal budget created by Republican vice presidential nominee Paul Ryan and supported by Republican presidential candidate Mitt Romney, Medicare would become a system in which the government provides seniors with a fixed amount of money each year to purchase their own private insurance, rather than having them enroll in a government-run insurance plan where coverage isn’t limited by a dollar amount.

Ryan’s proposals, which would not affect current seniors or those nearing retirement, would slow the rising costs of Medicare and possibly help slow the rate of healthcare cost increases. But if the government’s payments to seniors are not enough, seniors would have to make up the extra cost of their care.

“If that number gets frozen and healthcare continues to rise, at some point you’re paying more yourself out of pocket,” Tepe said. “Whereas with Medicare now you pay a premium for it, but…your net cost does not grow as fast as the cost of healthcare. But is it sustainable?”

President Obama and Congress included many provisions in the PPACA designed to help bring the cost of Medicare under control. The PPACA decreases payments Medicare makes to hospitals and private insurers, rewards quality rather than quantity of care, and encourages preventative care that will circumvent costly hospital visits for severe health problems.

According to the Centers for Medicare & Medicaid Services, those initiatives should save Medicare $575 billion over the next 10 years, reduce the growth in Medicare costs from 6.8 to 5.3 percent annually, and extend the life of the Medicare Trust Fund by 12 years, from 2017 to 2029.

For a more precise breakdown of where each candidate stands on the issue of Medicare reform and healthcare reform in general, take a look at the candidate boxes which are linked on the side of this page.