What is the Affordable Care Act?

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It is really interesting that the Inspectors Office is finding fraud in the Health Exchanges system in Maryland. False invoices, excess payment for work not completed or even done at all. This cost the taxpayers of Maryland over $200 million.

The Lieutenant Governor seem to be unaware of any problems and one wonders what he will do as the new Governor, which seems indisputable and unfortunate for the people of the State. How can someone like this poor performer, example of lack of leadership qualities be elected to such an important position? Your guess is as good as mine. Unbelievable, this Anthony Brown! We will see where these investigations go from here and whether the people responsible will be brought to justice.

I have decided to start my plan or strategy on how to survive the Affordable Care Act/Obamacare with a study of what the ACA really is and how it applies to all of us. The goal of affordable health care is not unique to this President. Don’t you all remember Hillary Clinton’s attempt to get her heath care plan through Congress? It failed to pass muster or even Congressional voting, but the fervor had not been forgotten. The persistent rally continued until President Obama was elected with his Democrat loaded Senate led by the ignorant Harry Reid. Remember Nancy Pelosi’s cry with foam dribbling from the sides of her mouth in anticipation-Let’s pass it and read it later! Unbelievable! Was this an example of a well educated, informed democratic, free market economy country group of trusted politicians approaching the creation of a law that would affect all of us? I think not! It makes no sense. So what is this bill/law?

A few facts that are now evident:

Many Americans who formerly had health insurance through their job lost their coverage this year. This is because January 1,2014 is when the new “Employer Mandate” went into effect, requiring employers with fifty or more full-time workers to provide the government-designed health plan or suffer fines. The employer mandate was delayed as well as other sections of the ACA due to the problems with the roll out of the ACA, especially the Web site.

The employer mandate added $1.79 per hour to the cost of hiring a full-time worker. This doesn’t seem like a lot until you consider that current employers in retail and fast food pay less than half that to cover their workers prior to the “mandate.”

Going forward from this year you will have to show the IRS proof of insurance when you file your taxes. In fact the IRS has hired 15,000 new armed agents to investigate violators of the law. Whoa!

Under the ACA/Obamacare, for the first time in history the federal government will dictate how physicians treat privately insured patients. Not really? Couldn’t possibly happen? But if one looks at Medicare where patients may have private secondary insurance, through the ACA more and more decisions regarding the care of the patient and the limitations will be dictated by non-payment of certain services or tests, to reduce health care consumption and therefore total costs of running the ACA.

Supposedly this year if you couldn’t show proof of being enrolled in the one-size-fits-all health care plan the IRS would be able to withhold your tax refund or you could get a penalty attached to your IRS/Federal taxes. So what are the alternatives for people who have been going without insurance, or your employer drops your coverage? Your options will be to enroll in Medicaid (if you are eligible) or buying a government-approved health plan on your state health exchange.

So, what are these things called exchanges? A number of states, but not all, have set up these exchanges, which is like a supermarket that sells only cereal or orange juice, that will sell only the government-designed health care plans. These states, that have exchanges, will have an 800 number, a website and a government office like the DMV. Also, people with household incomes up to $92,200 will be eligible for a government subsidy.

How will Obamacare/ACA affect the care of seniors? Under the ACA more than 50% of the cost of running the healthcare system will be funded by cuts in Medicare funds. Hospitals will have $247 billion les to care for the same number of seniors than without the law. So the hospitals working with less operating capital, will and are spreading nurses thinner and therefore increase the nurses’ workloads, with sicker and sicker patients. In their review “The Long Term Impact of Medicare Payment Reductions on Payment Outcomes,” National Bureau of Economic Research Working Paper 16859, March 2011, written by Vivian Y. Wu and Yu-Chu Chen stated that when cuts in Medicare caused hospitals to reduce nursing care in the past, elderly patients had a lower chance of surviving their stay in the hospital, and death rates from heart attacks rose.

Interestingly the ACA includes about half a trillion, yes that is trillion, in tax hikes. One that may hurt is the 3.8% additional tax on gains from selling any asset, including your home, small business, stocks, or bonds, which actually became effective January 1, 2013. Remember this new tax is on top of capital gains taxes, and it applies to any gain that increases your income over $200,000. (Homeowners selling a primary residence may be excluded under some circumstances.)

A recent article by Phil Galewitz in the Kaiser Health News described the effect on the taxpayer:

“When Congress passed the Affordable Care Act, it required health insurers, hospitals, device makers and pharmaceutical companies to share in the cost because they would get a windfall of new, paying customers.

But with an $8 billion tax on insurers due Sept. 30 — the first time the new tax is being collected — the industry is getting help from an unlikely source: taxpayers.

States and the federal government will spend at least $700 million this year to pay the tax for their Medicaid health plans. The three dozen states that use Medicaid managed-care plans will give those insurers more money to cover the new expense. Many of those states — such as Florida, Louisiana and Tennessee — did not expand Medicaid as the law allows, and in the process turned down billions in new federal dollars.

Other insurers are getting some help paying the tax as well. Private insurers are passing the tax onto policyholders in the form of higher premiums. Medicare health plans are getting the tax covered by the federal government via higher reimbursement.

State Medicaid agencies say they have little choice but to pay the tax for health plans they hire to insure their poorest residents. That’s because the tax is part of the health plans’ costs of doing business. Federal law requires states to pay the companies adequate rates.

“This situation results in the federal government taxing itself and taxing state governments to fund the higher Medicaid managed care payments required to fund the ACA health insurer fee,” said a report by Medicaid Health Plans of America, a trade group.

Meanwhile, many Medicaid managed-care companies have seen their share prices — and profits — soar this year as they gained thousands of new customers through the health law in states that expanded Medicaid. More than half of the 66 million people on Medicaid are enrolled in managed-care plans.

The Centers for Medicare & Medicaid Services declined to comment on how states and the federal government are covering part of the tax. “People always like to get a benefit and not have to pay for it,” he said. “If we did not have this tax, we would have had to raise the money somewhere else.”

These are just a few of the changes that the ACA that will affect all of us in many ways. I will continue to describe more of these changes and will attempt to guide you to alternatives to shock and paralysis and instead what we should be doing to protect ourselves.

The bill, when it was passed into law, was 2,572 pages long. However, with the riders, references and newer regulations to correct mistakes, the total length approaches 10,000 pages. Who has the time to read every page? No wonder Nancy Pelosi said let’s pass the law and read it later. Oh, Nancy what an inappropriate statement or does this statement show your and Congress’ ignorance and arrogance?

The most important pearl for my readers and for all Americans is that they educate themselves, make educated decisions and vote for those who will represent them honestly and with no bias based on their own political futures. Hopefully with a new set of Congressional lawmakers, whose sole goal for being elected is to do their best for we their employers, will correct the mistakes made in the design of the ACA.

A pearl for physicians is to make sure that you haven’t been eliminated from one of your insurance companies networks. The insurance companies are deciding who to should be a member of their network depending on cost and quality issues all decided by their company advisors.

Next week I will delve more into the specifics of the Affordable Care Act.

Happy Labor Day weekend to you all!

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