4. Summary
of
ACA
• Individual
requirement
• Subsidies
to
individuals
– Tax
of
$695
or
2.5%
of
up
to
400%
FPL
taxable
income
in
2016
• Exchanges
created
by
– Only
$95
in
2014
states
• Employer
requirement
to
– Benefit
Lers
offer
“minimum
essenLal
• General
insurance
rules:
coverage”
– Guaranteed
issue,
no
life
– Only
employers
with
>50
limits,
no
pre-‐exisLng
FTE
clauses,
limits
on
premium
– PenalLes
for
not
offering
variaLon
coverage
or
offering
• Taxes:
ñMedicare,
unaffordable
coverage
Cadillac
plans,
Pharma
• Small
employer
tax
credit
and
Devices,
Insurance,
• Medicaid
expansion
Tanning
Salons
5. Summary
of
ACA,
con/nued
• Medicare
$
changes
• Several
measures
to
– Ind.
Payment
Adv.
Board
“improve
quality,
health
– Cut
in
DisproporLonate
system
performance”
Share
Hospital
Payments
– ACOs
– Cut
in
growth
rate
of
– InnovaLon
Center
Medicare
payments
– ComparaLve
– Restructure
payments
effecLveness
research
for
Medicare
Advantage
– Medicare
pilot
program
on
bundled
payment
• NaLonal
strategy
on
prevenLon/wellness
6. The
subsidies
(tax
credits)
are
substan/al
Congressional
Research
Service,
Private
Health
Insurance
Provisions,
4/15/10
9. What
do
I
think?
• On
the
plus
side
• On
the
minus
side
– Expansion
of
coverage
to
– Hodgepodge
of
taxes
needy
– Doesn’t
move
away
from
– Sorely
needed
fixes
to
employer
sponsored
health
insurance
markets
insurance
– Some
impetus
and
a
– Doesn’t
break
down
state
plaGorm
for
barriers
experimenta/on
(ACO,
– Too
much
government
bundled
payments)
control
over
benefits
design
– Exacerbates
market
power
on
supplier
side
– Cons/tu/onal
issues
linger
17. “...Last
year,
Georgia
hospitals
lost
an
esLmated
$1.5
billion
caring
for
people
without
insurance...The
promise
of
fewer
uninsured
is
what
led
the
naLonal
hospital
industry
to
agree
to
the
health
law’s
$155
billion
in
Medicare
and
Medicaid
cuts
over
a
10
year
period.”
“Hospitals
face
lower
payments
from
insurers
and
pressures
to
consolidate.
One
in
three
Georgia
hospitals
lose
money...”
“Georgia
is
one
of
at
least
10
states
that
may
reject
the
Medicaid
expansion,
according
to...the
nonprofit
Brookings
InsLtuLon.”
“Get
as
big
as
you
can
get
and
as
strong
as
you
can
get
as
an
organizaLon
is
the
overarching
strategy,”
Jennings
said
(CEO
of
Wellstar
Health
System
in
Atlanta)
Williams
and
Teegardin,
Atlanta
Journal
ConsLtuLon,
July
8,
2012
18. Issue
#3:
Employer
Sponsored
Insurance:
Will
it
Disappear
under
ACA?
• You
cannot
just
compare
the
penalty
with
the
cost
of
an
employer
providing
health
insurance!
– Dropping
a
benefit
is
not
free...
• Indeed,
why
would
a
penalty
on
employers
for
not
providing
insurance
lead
to
a
decline
in
ESI??
• The
right
comparison
is
penalty
to
employer
vs.
subsidy
to
employees
on
exchange,
less
tax
advantage
of
employer-‐provided
insurance
19. L
DuBay,
SK
Long,
and
E
Lawton,
Will
Health
Reform
Lead
to
Job
Loss?
Urban
InsLtute,
June
2012.
Thanks
to
J.
Skinner,
Dartmouth,
for
slide.
21. Issue
#4:
Isn’t
the
employer
mandate
a
tax
on
employees?
Wage
S1
Demand,
supply
of
labor
D1
D2
Labor
22. As
a
first
approximaLon,
wages
should
fall
and
employment
stay
the
same
S1
Wage
S2
Demand,
supply
of
labor
D1
D2
Labor
23. Caveats
• If
insurance
was
not
available
compeLLvely,
employees
might
value
it
more
than
cost
to
employer
• On
the
other
hand,
some
employees
might
prefer
cash
to
health
insurance...especially
with
exchange-‐
available
insurance
• And
wages
tend
to
be
inflexible
downward...especially
at
low
wage
levels
• And
many
employers
have
already
chosen
to
not
offer
insurance...
Overall,
I
have
a
hard
/me
not
seeing
this
as
a
net
tax
on
employment
24. Opportuni/es
• Mergers
– (NYU
Langone/ConLnuum/Mt.
Sinai)
– Turs
Health
Plan
buys
Network
Health
– Yesterday:
Wellpoint
acquires
Amerigroup!
• Health
plan
creaLvity,
for
exchanges
and
employer-‐sponsored
– Design
of
networks
– Tiering
(of
plans,
of
suppliers)
– Benefits
creaLvity
• Focus
on
value
of
health
care
delivery!
25. The
Major
Management
Challenges
(Some
of
the…?)
Balance
mission
with
financial
viability
Adapt
to
new
reimbursement/payment
models
Cope
with
health
care
reform/regula?ons
Deal
with
changing
popula?on
health
and
demographics
Get
the
incen?ves
right
Create
managerial
and
leadership
capacity
Coordinate/collaborate
–
at
all
levels,
including
across
organiza?ons
Build
a
capacity
for
organiza?onal
innova?on/change
Deal
effec?vely
with
technological
advances
Appropriately
use
evidence
in
determining
care
26. Why
we
are
here
Tremendous
change…
Massive
challenges…
For
an
unimaginably
important
cause…
And
all
happening
at
once
