JONATHAN COHN MARCH 23, 2012
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When President Obama signed the Affordable Care Act two years ago, the law's proponents (including me) were confident of two things: That it would become more popular with time and that it would make our health care system more humane and efficient.
History has not been kind to the first prediction. Most of the law’s components command broad support: Overwhelming majorities still support the requirement that insurers cover people with pre-existing conditions, for example. But overall the Affordable Care Act is unpopular. And while those who wish to keep or strengthen it outnumber those who wish to repeal it, the intensity clearly lies with the latter.
Those critics will have one last chance to get their way, in the elections this November. The Supreme Court, which next week hears oral arguments in legal challenges to the law, may help them on their way.
On the other hand, the second prediction looks pretty good, at least to this point. Already more than two million young adults have gotten health insurance through their parents’ policies. More than five million seniors and people with disabilities have saved more than $3 billion on prescription drug costs, according to the Department of Health and Human Services. Millions of Americans have consumer protections that, for those unlucky to need them, have made a real difference in their lives.
Of course, it won’t be until 2014 that we see the really big changes in health insurance coverage —the expansion of Medicaid to include everybody with income below 300 percent of the poverty line, the creation of a marketplace with subsidies where individuals and small businesses can get affordable insurance without discrimination. Undoubtedly this helps explain the public’s ambivalence.
But another set of changes are happening, too: Changes to the delivery of medicine. The Affordable Care Act isn’t simply about making insurance more widely available. It’s also about re-engineering the health care industry, so that it operates more efficiently—providing treatment that is higher quality, less expensive, or both. Its primary means for doing so is a series of changes to the way Medicare pays for treatment. The idea, as Sarah Kliff explains in the Washington Post, is to move from a system that rewards volume (i.e., the number of procedures performed) to a system that rewards value (i.e., the quality of care provided).
To the surprise of many observers, myself included, the law seems to be making serious progress towards that goal already.
A case in point is Baptist Health System, a hospital network in San Antonio whose story Kliff tells. Three years ago, Baptist decided to change the compensation for surgeons, paying more to those who could demonstrate they were following quality and safety guidelines and less to those who were not. Physicians were initially wary and several left. But compliance with the guidelines improved, the surgeons who remain are taking home bonuses, and Medicare is actually saving money.
Insurers are also changing their ways. Jeffrey Young of the Huffington Post notes that Aetna and WellPoint, two of the nation’s largest insurers, have increased pay to primary-care providers, in the hopes that focusing on prevention and routine care will reduce the need for more expensive, acute care. Young also reports that Highmark, a nonprofit insurer in Pennsylvania, is getting into the business of providing care directly through clinics of integrated medical professionals. Historically, such systems have provided some of the lowest cost, highest quality care in the country.
The Affordable Care isn’t the only reason these businesses are changing their ways. Remember, Baptist Health started its experiment began more than a year before the Affordable Care Act became law. But where past efforts at improving the delivery health care stalled after a few years, this one seems to be intensifying. In a recent survey by the Advisory Board, just 16 percent of hospital systems said they had similar payment systems in place. But, as Kliff notes, 75 percent said they expected to have such systems within the next two years.
Maybe the clearest sign of change is on the bottom line: Medicare spending has been coming in lower than projections. The recession had something to do with that. For the last few years, people were cutting back on medical care, just like they were cutting back on other expenses. But Paul Ginsburg and Chapin White, two widely respected experts from the relentlessly non-partisan Center on the Study of Health System Change argue that slow growth explains only part of the change. Writing in the New England Journal of Medicine recently, they suggested the Affordable Care Act—and the incentives its putting in place—are a major reason Medicare is starting to save money.
Harvard's David Cutler, another highly respected economist, has been saying this was possible for a long time. “It is absolutely not just the recession,” Cutler, who was an original architect of what became the Affordable Care Act, said via e-mail. “The ACA is having an impact, as are changes like greater cost sharing. There is a real question as to whether we are entering an era of low cost growth.”
It’s far, far too soon to know the full impact of these changes—or whether they will really last. And the law, as a whole, could have plenty of negative effects. Death panels are a fantasy and mass disruptions of employer insurance seem unlikely, but implementation problems, particularly in states unenthusiastic about carrying out the law, are entirely realistic. And as surely as there will be some winners, there will be some losers, in the health care industry and in the public at large (just as there is in the status quo).
Nor is it obvious that the early benefits, particularly those on the delivery side, will make a difference politically. Although the White House and the Obama campaign have been promoting health care reform aggressively in the last two weeks, Obama himself made no special effort to mark the anniversary on Friday. One reason: His advocacy of the law doesn’t seem to help its popularity.
That may change during the campaign, once Obama can counter-punch against Republicans whose explicit goal is to take health insurance away from both the people who would get it under the Affordable Care Act and some who already have it. For now, though, popular health care remains a dream—even as successful health care reform starts, slowly but surely, to become reality.
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13 comments
Jonathan, I just looked into the Lincoln-Douglas debates. Interesting, as we all know. But what was most uncanny was the politics of the 1850s. Stephen Douglas, a Northern Democrat, was supportive of the Compromise of 1850. That didn't work. Above all, he wished to make his mark on the national stage as an ambitious senator hoping to be his party's presidential nominee one day. So he married the long-stalled hope for a transcontinental railroad with the naively democratic concept of "popular sovereignty" and was able to pass the bill in the Senate after two months of bitter debate in the Senate. It took even longer to win over the House because of legislative delaying tactics, and a principal argument in its favor was once again the notion that the people of a territory (or state, for that matter) should be able to decide on slavery. You know, states' rights. This was, to the law's backers, a potentially more durable plan than the decades-old Missouri Compromise, a flawed but serendipitous resolution (it's why Maine is no longer part of Massachusetts) that proved increasingly unworkable for a growing and changing country. Anywho, this radically conservative and curiously democratic solution proved to be a political landmine. It triggered grassroots (and astroturf) political activity that converged upon Kansas and Nebraska as they conducted elections in their long march towards statehood. It sank the presidency of Franklin Pierce, as he recognized the illegitimate pro-slavery Kansan government and was denied a renomination. Luckily for Douglas's future ambitions, the opposing Whigs collapsed over the issue and had just begun to reorganize as the Republicans. Unfortunately for Douglas, however, the Supreme Court handed down the inopportune Dred Scott decision which more or less mooted the concept of popular sovereignty. This, and Lincoln's determined challenge to Douglas in the 1858 Senate elections, helps explain why Douglas survived in a squeaker. (Although because of gerrymandering and lopsided growth from 1850-1858, Republicans actually managed to net more popular votes, which means that if senators had been elected by direct popular vote, Lincoln would have won.) That is to say, even though Dred Scott effectively federalized all states such that became slavery-tolerating again, Douglas "etch-a-sketched" his position in such a way that different states could do as they wished. Maybe the people in Illinois wanted to remain a free state, but that had no bearing on, say, the people of California. Ultimately, what would end up being the death of Douglas* was some combination of the contortions he made in the 1858 debates with Lincoln to remain electable in the South two years later and the rapidly shifting mood of his own party's electorate by 1860. The Kansas-Nebraska Act was a toxic politicized mess that would not cement his image as the nation's new Great Compromiser. Civil and political unrest was brewing around the country and in his own party as the eventual admission of Kansas as a free state--tacitly supported by Douglas four years earlier as he bucked his president and rejected its pro-slavery government--helped burn his bridges with Southern Democrats even as he pledged support for Dred Scott and urged that the doctrine of popular sovereignty meant that people could buck the Supreme Court and pass laws that made it difficult to keep slaves if they wanted to live in a free state. And what was Douglas's fate at the Democratic National Convention in Charleston? Well, he had over half the delegates, but since the rules required a 2/3 majority, Southerners held their ground and stood by their platform plank that made Douglas's hedges inadmissible: Dred Scott had nullified the law of the land and they would now not tolerate compromises. The so-called Fire-eaters (Southern hardliners) didn't even push for a brokered convention, as they waited out 57 ballots and then walked out to convene their own Southern Democratic convention. When the Democrats re-convened, they nominated Douglas easily and he went on to lose the election to Lincoln in the most curious plurality victory our Republic has yet seen. *Not his actual death--just the death of his presidential hopes--though by coincidence he died of typhoid seven months after the election (a month and a half before the first battle of the Civil War). Important points: Stephen Douglas was a pioneer who tried to do away with a decades-long compromise in favor of a new model. Douglas's advocacy of such radical change almost cost him his re-election in 1858 and vaulted Lincoln, who later beat him to the presidency, to national prominence. The innovative and precedent-shattering Dred Scott decision changed the topography of both the 1858 and 1860 elections. Though hamstrung by his work on the Kansas-Nebraska Act, Douglas was initially able to win favour with Northerners by rejecting the undemocratic regime in Kansas even as he placated Southerners by saying "the right things" about Dred Scott. Even so, Douglas was nowhere near winning the South. Popular sovereignty, though popular and moderate at the time, was really just a glorified way of federalizing away the buck to ignore the role of the federal government in establishing a minimum moral/legal standard.
- chaitless
March 24, 2012 at 4:06am
Good Reporting from Mr. Cohn (Chaitless not so much :) ). I think the official conservative position is that if God had wanted Man to have Health Care, he would have given him (or her) more money.
- Nusholtz
March 24, 2012 at 8:39am
Putting hospitals in charge of efficiency is like putting thieves in charge of security. Hospitals are creating "alliances" with physicians for two reasons: to guarantee what they call "loyalty" and to dip into the pocket of the professional component of reimbursement. As to the former, that "loyalty" includes the exclusive use of the hospital, not only for procedures that can only be done in the hospital but procedures that can be done, and done more cheaply, in free-standing outpatient facilities. As to the latter, putting hospitals in control of "bundled payments" is like giving Goldman control over Apple's cash horde - much of the cash will end up in the pockets of Goldman's partners. There are many reasons for supporting ACA, but this misplaced confidence in the "benefits" of consolidation in the health care industry is not one of them. Or to put it another way, don't blame ACA.
- rayward
March 24, 2012 at 9:54am
Thank you for consistently reporting on healthcare and doing so in such a clear manner. Facts are the only antidote to fear-mongering. There seems to be an editing error in this section, though: "Baptist decided to change the compensation for surgeons, moving them away from a system that rewarded volume (i.e., how many procedures they preformed) and towards one that rewarded volume (i.e., whether they followed guidelines..." I think you meant that last "volume" to be "value."
- madestef
March 24, 2012 at 10:23am
The only way the bill will ever be accepted and popular is for the Supreme Court case go Dems way and Obama be re-elected. I watched Fox a few days ago where they put forward the lie that Obamacare cost doubled and there was no one on there to challenge the numbers, say by asking what was the previous reported projected cost for 2015, then 2016, and so on and what was the now projected cost. Fox news deliberately misleads the public about the reality and Fox news viewers are complicit by their own stupidity. And the worst thing is even with the ACA health care reform has such a long way to go. Republicans scream that employers will start to not offer healthcare and people will be "forced" to go onto fully subsidized and much larger health insurance exchanges (which was a Conservative position pre Obama) when, of course, they never explain why it is better than US companies have the added expense of acting like a social welfare agency.
- blackton
March 24, 2012 at 10:54am
Fair enough. There's a passionate group of the electorate who is passionately against Social Security, too. They're passionately against the New Deal, they passionately hate FD Roosevelt and all he did as Socialist. They passionately hate paying taxes too. And all those things have been in place, and having positive results, for over 60 years. That the ACA offends these people to such an extent is more expressive of who they are and where they're coming from (Republicans, enjoying their riches and pretending that Society had nothing to do with it). That doesn't mean their position, passionate though it may be, has any reason or logic or even good policy behind it.
- AllanL5
March 24, 2012 at 11:03am
The ACA reforms are real... but are really insurance reforms and a fraction of what is needed for heath care reform. Re-arranging the deck chairs on the Titanic also helps... but not much and not what is really needed. Until politicians that advocate real Progressive reforms (health care, financial regulation, Keynesian economic policies, separation of church and state, declared wars of necessity rather than undeclared wars of preventative choice) are supported and elected-- and all others seriously challenged (including BHO), the Dems will struggle and the US will decline economically and socially.
- drofnats1
March 24, 2012 at 2:02pm
The Tea Party Patriots are on C-Span Live in D.C. right now ranting against the socialist guv'mint takeover of health care in America. That means that when these idiots go to the doctor and sit down in chairs in the waiting room, the words PROPERTY OF THE U.S. GOVERNMENT are stenciled on the back of those chairs. And many of them have children in their twenties who, thanks to ACA, are still on their parents' health care plans. And even more of them, thanks to ACA, are allowed to get health care with a pre-existing condition. The one defining characteristic of the Right is hypocrisy, which is the most cowardly of traits. Republicans are swimming in it.
- magboy47.
March 24, 2012 at 2:19pm
Older woman at the Tea Party Patriots rally against ACA: "Uncle Sam, keep your mitts off my tits!" Then she goes on to admit that ACA ensures annual mammograms for women over 40, but that's not enough! Ultrasounds need to be included! Like the insurance companies are all going to rush forward and say, "Yes! Let's include multi-thousand-dollar annual ultrasounds for every woman over 40!" Right, lady. Like insurance companies haven't been severely rationing health care for decades. This woman goes on to describe her exit from the operating room after surgery, so loopy that she couldn't remember what she was saying. Her husband later related to her that she was yelling, "RED, WHITE, AND BLUE! RED, WHITE, AND BLUE!" Enough said about the thinking abilities of Patriots with a capital P--those who see ACA as the work of the devil. There's a guy on now who describes himself as a Patriot Farmer, the Planter Dude, who's going around planting the seeds of liberty. "Excuses are the nails in the house of failure!" Ouch! Actually, that's a pretty good one.
- magboy47.
March 24, 2012 at 2:50pm
For the commenters who appreciate euphemisms, how about "minimum coverage provision". One can read Verrilli's briefs beginning to end and won't find the word mandate. I'm more than curious how the Justices will refer to whatever it is they are considering.
- rayward
March 24, 2012 at 4:35pm
When I attended the local Republican caucus, the relatively small number of younger people were libertarian and not much worried about getting sick. The larger number of older Republicans I encountered have experienced (personally or with friends/relatives) illness and were much concerned about heath care. As they discussed health care, they seemed to be edging toward something like “Obama care,” except it had to be called something else and labeled as something else. Aside from noting the ultra-conservative hatred of “liberals” in general, I am sliding toward the suspicion that the extra hatred of Obama is really somehow a big part of the slavering about “Obama care,” and that is in turn a way for racist hysteria about having a black President to stick its ugly nose out from under the tent. Insurance just doesn't work unless there is a large enough pool to distribute risk, and to provide a way to pay for the unlucky people who get ill. We've known for a long time in regard to automobile insurance that unless everybody is covered, society will have huge problems with uninsured people who have accidents. It's just a problem in a society that undermines fantasy libertarianism. A lot of people can't see this in regard to health care. It's a combination of the madness of tying health care to employment so those who are employed think those who are not employed or not covered in their work are lazy scum, and the fantasy/denial of “I am not sick now; I won't get sick any time soon; I won't worry about it.” There should be a place in our political system for a sensible conservatism that supports and encourages self-sufficiency, entrepreneurial energy, and self-reliance; but it needs to be plugged into some basic contact with reality and understanding that we are a society and not a bunch of deranged atoms.
- skahn
March 25, 2012 at 12:34am
Speaking of health care, I understand Dick Cheney got a new heart this weekend. I hope it's a human one this time.
- magboy47.
March 25, 2012 at 9:58am
Magboy, that's a terrific zinger. Unfortunately, as a child who listened to the radio serial THE SHADOW, I was so struck by the show's "tag line," that I doubt that the use of a human heart would do any good. "Who knows what evil lurks in the hearts of men? The Shadow knows!" So it's not likely that implanting a human heart would be such a good bet. Also, I once heard Mary Cheney speaking with great affection of her mom and dad, who did not reject her. So even a member of the 1% may have a 1% percentage of human kindness in his frigid veins.
- skahn
March 25, 2012 at 10:51pm