Forgive me for my attitude on this one but please read on. There is something important here.
As an active viewer of the current news I get it. The news cycle is shorter and shorter and that alone makes it more repetitive by definition. But, this one, King versus Burwell had me shouting at the radio yesterday and throwing things as I read some of the stories on news and aggregator sites. Nobody is getting this right but rather are simply showing their bias as they feed their viewpoint to the folks that only get the highlights on any given day.
The "right" says that this part of the PPACA is expressly forbidden in the law itself and that the subsidies cannot be paid in the 36 states that did NOT setup their own exchanges. So, since when did the IRS giving money away to the carriers or to companies ever get stopped because the law was not there supporting it? Under the ARRA (American Restoration and Recovery Act) hundreds of millions of dollars were funneled to COBRA participants and that was just fine. There has even been some talk of bringing that back. Who would NOT want a 65% premium reduction for 15 months. Many thousands were able to "score" lifetime reductions of premium (Link) The "right" also says this case could bring down "ObamaCare".
The "left" says that accepting the interpretation that Federally run Marketplaces cannot pay subsidies would cause premiums to go up 47%. Wow. Really? The "left" also says that this is "taking insurance away from 8 million people" because it will become unaffordable. First, the 47% was reported on NPR just yesterday. Start listening at 1:45 Link . This 47% comment is promoting a total misunderstanding of how increased enrollment with healthy premium payers has actually worked. For the 47% comment to be true, we would have had a decrease in premium by adding 8 million participants under the PPACA. Instead, we saw a 20% plus increase over each of the past two years.
This Congress or any other modern Congress will NOT take away benefits because the benefits give them an ever increasing grip on the economy, power and re-election contributions. Follow the money trail for the political contributions and see what I mean. Just one quick example. Saudi Arabia and many other Middle East governments gave the Clinton Foundation over $50 million. Why would our former Secretary of State not call them out for slavery in Qatar and Saudi Arabia, or even women's rights in the Middle East. Follow the money.
This makes me weary because the people on BOTH sides have NOT taken the time to understand how real insurance works. The PPACA is NOT insurance ... sorry. It missed the definition by a mile.
Insurance is the written plan to transfer a defined risk to another party. Both parties understand the "contract" and those that make the insured whole when a loss occurs do NOT negotiate rates with the party taking the risk.
My daughter was 15 and she was very sick with the flu. Her pediatrician sent her to the hospital. They did a pregnancy test ... fine. Two days later, when she was readmitted, they did another pregnancy test ... fine. The hospital is just managing their liability while charging over $300 for each test. Why does this work this way.
First, this is what the insurance company will pay. And they agree to pay that because they can build that into my premium because they now have cover under the MLR (Medical Loss Ratio) provisions of the PPACA. No body really cares about how much it costs because the person actually paying it does not know they are paying it ... it is in the premium and that person is me. I can't "negotiate" with the hospital because I don't PAY the hospital ... the insurance company does.
Second, the liability management becomes a principal point of care because of "ambulance chasers" that can get huge settlements in court cases because there are NO limits on awards. It is cruel to place a value on a life lost, or even a permanent disability as a result of an oversight or any kind of malpractice but why should a family get $100 million with the attorney getting 1/3 or more? Why? Sure the provider should be punished, but raising the bar this high is crazy. The practice has to have insurance for that exposure and that cost just gets built into the billing process and that billing gets built into the premium and I get to pay that. We need tort reform but since the Trial Lawyers "own" the Congress, this will NEVER happen.
Third, the practices have huge costs for malpractice insurance. So much so that that insurance costs far more than most sole practitioners cannot manage this so they either quit or fold their patients and practice into larger groups to spread this cost and more negotiating authority with the carriers.
Fourth, the cost of education is far far beyond reasonable reach. I have a friend that is two years from finishing residency. He is over $500,000 in debt for school. So, let me get this straight. He is going to start his career with that debt and does not have a home or even a car included in that. How much does he need to make and therefore charge for his services?
Thee PPACA has some good reforms in it. It has some really BAD stuff in it.
The surprise is this ... the PPACA memorializes the problem with the current "benefit insurance" model. The person paying the premium is NOT negotiating or even involved in the payment of claims and there is very little disclosure of how much things cost.
Three years ago, Washington University in St. Louis did a cost study for a hip replacement for an otherwise healthy 60 year old female that did NOT have insurance. 150 hospitals were surveyed including Johns Hopkins and other "name brands" as well as regional independents. For the same service codes, the cost ranged from $16,000 to over $150,000 but the most amazing thing was that nearly 1/3 of the hospitals COULD NOT (not would not) provide the cost estimate because that was not a price that was determined in advance.
For the system to work, their has to be a provision for the insured to review, negotiate and pay the claims and get reimbursed by the insurance company. Giving this part of the process to the insurance companies or to the government makes our collective ignorance cost far too much.