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Health Care Fortune Teller

David P. Lind BenchmarkDuring the past two years, I’ve fielded countless inquiries from curious Iowans asking me to put on my fortune-teller hat and look into my crystal ball to predict how health care reform will impact their lives. Questions run the gamut:  

  • Do you think it will solve the ills of our health care system?
  • How will health insurance rates be affected by the new health reform law?
  • Will I be able to keep my own doctor?
  • Will employers continue to offer health insurance to their employees in 2014 and beyond?
  • Will the U.S. Supreme Court deem the individual mandate unconstitutional? If so, will health reform be repealed?
  • Who will be the chief czar of the newly created “Death Panel” in Washington, D.C.? (OK, this one was a bit exaggerated by me!).

Anxiety and fear are often at the root of these concerns. Perhaps the questioner watched the nightly national news and caught a vignette about how reform will impact a certain segment of society, or perused a magazine article that portrayed a certain provision in the law as either negative or positive. We have certainly been bombarded with “facts” from supporters and detractors of the law since March, 2010. No wonder we are feeling confused and overwhelmed with the complexities imbedded in this mammoth law.

I typically refrain from giving my views on the health reform law. But, when confronted, my comments sound something like this:

  • There are usually two (or more) sides to every argument, and health care is no exception to this maxim.
  • Determine the source of the information before accepting it as truth. Supporters and detractors may not portray competing arguments with much objectivity. Be mindful of possible agendas that may cloud the “truth” they espouse.
  • There are NO Silver Bullets that will solve the ills of our health care system. It took us 60-plus years to get into this mess, and it will take time to put our health care ‘system’ on the road to “recovery.”
  • Lastly, I will ask them if they always believe the weather forecast. Because forecasting how reform will impact us is similar to trying to predict the changing weather patterns in Iowa over the next year (or week)!


Health Care Hurdles

David P. Lind BenchmarkThe clock is ticking and finally, after waiting two years and with great anticipation, March 26-28 has come and gone. Now we must wait again, at least until late June. For what? For decisions that will determine the future of how we pay for health care coverage.

During March 26, 27, and 28, the U.S. Supreme Court has heard six total hours of arguments, the most time given to a case in decades. The arguments will determine whether the individual mandate, a cornerstone of the mammoth 2010 health reform law, will either remain in place (for implementation in 2014) or be ruled unconstitutional. Twenty six states (including Iowa) believe the federal government does not have constitutional authority to require most Americans to purchase health insurance.

The stakes are high, VERY high.

I will go out on a limb (not really!) and predict that each and every one of us will be greatly affected by the outcome of this decision…employers are definitely impacted for obvious reasons.

In my mind, there are at least four possible fundamental major outcomes from this historic decision (so choose your poison!):

1. The Justices decide that 2014 must come first so the mandate is in place BEFORE the Supreme Court can rule on the constitutionality of this case. This stems from a nineteenth century law that basically says you can’t have a lawsuit on taxes if no one has yet been harmed by the tax. By no means am I a legal expert…but we seem to be prolonging the inevitable if this happens. In fact, both supporters and detractors of the individual mandate agree that this should not happen. It’s nice to know that both sides can agree on at least one thing! Audio of oral arguments is found here.

2. The individual mandate is ruled constitutional and therefore most every provision within the law will survive and be implemented. Even if this happens, the controversy will not be over. We have elections in 2012 and 2014 that could greatly impact whether reform remains. Audio of oral arguments is found here.

3. The mandate is deemed unconstitutional, and this is where it becomes extremely interesting.  Health insurance companies would be thrown into chaos if there is no mandate in place, because the mandate assures coverage for most all people (those with good and bad health risks). Without the mandate, insurers would most likely assume much greater risk because people who are healthy are less likely to seek insurance coverage…but those with health problems are more likely to sign up for coverage – and insurers would have to accept them. Health insurance premiums would increase much faster as a result. Under this scenario, the Supreme Court will then need to decide whether the rest of the law will remain or be repealed in parts or in its entirety.

4. Regardless of the individual mandate decision, the expansion of Medicaid coverage could be struck down by the Court, resulting in low-income individuals having private coverage at a much higher cost. Audio of oral arguments for #3 and #4 is found here.

Complex stuff, isn’t it? There is so much at stake for all Americans it is mind boggling.  Regardless of the mixed bag of results, hopefully a decision by the Supreme Court will provide more certainty than we have today, which is an absolute necessity. One hurdle has been reached, yet many more are on the horizon – for years to come.


Health Reform…Are You a Skeptic?

David P. Lind BenchmarkAs an employer, what do YOU think of health reform? Will it successfully attack rising health insurance rates that you continue to pay year after year? Will the Iowa health insurance exchange in 2014 make any difference for small employers? What about the Supreme Court’s involvement?

Most of these questions (and many others) were asked of Iowa employers in our 2011 Iowa Employer Benefits Study©. So how did they respond? They’re a skeptical bunch.

  • 54 percent either “somewhat agree” or “strongly agree” that the health law should be repealed completely
  • 68 percent at least somewhat agree that the law should be repealed in some parts only, while keeping other parts of the law intact
  • 65 percent believe employer health plan costs with increase because of health care reform
  • Only 17 percent agree that a state-based insurance exchange will keep health insurance rates lower than without health reform (41 percent are unsure)
  • 54 percent believe the provision of the law to require coverage (or pay a fine) should be repealed (also known as the individual mandate)
  • 51 percent want a repeal of the provision that requires employers with over 50 employees to either continue offering coverage or pay an annual penalty of $2,000 per employee.

Iowa employers do, however, support the provision that prohibits insurance companies from denying coverage to individuals due to poor health. I think this is one part of the law that most everyone agrees we should keep…but to do so, insurance companies need the assurance they are covering healthy people too.

All of this leads to the Supreme Court hearing arguments in late March about challenges to this law, specifically the constitutionality of the law’s individual mandate that requires most Americans to obtain health insurance and of provisions requiring states to expand eligibility for their Medicaid programs. Based from the arguments, it is likely the Supreme Court will issue a written opinion before the close of the current term in June, 2012.

STAY TUNED…regardless of the outcome, we will continue to see rising health care costs (and insurance premiums) for the unforeseeable future. Iowa employers have reasons to remain skeptical and apprehensive for the time being.