While PPACA remains in question, payment reforms still overlooked

March 1, 2011

With the vote to repeal the Patient Protection and Affordable Care Act behind them, many Congressional leaders are focusing instead on ways to repair or eliminate some of the more contentious reform provisions.

NATIONAL REPORTS-With the vote to repeal the Patient Protection and Affordable Care Act (PPACA) behind them, many Congressional leaders are focusing instead on ways to eliminate or repair some of the more contentious reform provisions, according to policy watchers.

"As most suspected, the repeal vote easily passed the House of Representatives," says Jeff Smokler, senior vice president at Powell Tate, the Washington, D.C.-based public affairs division of Weber Shandwick Worldwide. "Ongoing debate of the law will spill into this year's appropriations process. Republicans who want to roll back key components of the law will seek ways to defund various elements. This creates an additional headache for industry stakeholders, who must move forward with implementation but still pay some attention to what is happening in terms of rolling back some of the reforms."

A push to repeal PPACA failed in the Senate early last month by a vote of 51 to 47, some 13 votes short of the 60 required under Senate rules for repeal.

"With a pretty narrow definition of 'quality' as a backdrop for meeting the new MLR requirements, health plans and others will more than ever be looking at getting the very best outcomes for the best value," Smokler says.

He says that the new requirements will cause health plans and hospitals to re-evaluate the way they do business.

Healthcare stakeholders should be planning ahead for provisions three or more years down the road but also be open to changing strategy if need be, according to Steve Wojcik, vice president of public policy at the National Business Group on Health, a non-profit association of more than 300 large employers.

"Certainly some of the tax provisions warrant another look," Wojcik says. "In addition, we should step up the focus on payment and delivery reforms, which are the key overlooked area in the law. They are ultimately what needs to be tackled to eliminate waste, overuse and overpayment, and to make sure we have the money to cover all the needed care for those who have no coverage and may soon have access to coverage and care because of the law."

NEW REIMBURSEMENT ESSENTIAL

He says if the system doesn't radically change reimbursement models, for hospitals and physician specialists in particular, the government will soon find that it cannot afford the promised expansion of Medicaid or the tax credits to keep coverage affordable.

The biggest threat for managed care is the elimination of the individual coverage mandate.

"And there is no alternative to the mandate," he says. "Without it, the entire bill fails."

If the reform law becomes ineffective, as many as 129 million Americans with pre-existing medical conditions would be at risk of losing health insurance or denied coverage altogether, according to the Department of Health and Human Services.

"No one-neither Democrats nor Republicans nor insurers-believes that the individual and small group market reforms, including this one, should be repealed," says Wojcik. "There was a broad consensus right from the start of last year's debate that these reforms were needed along with the individual mandate in order to have a functioning individual and small group market that offers affordable coverage. Additionally with so many people having pre-existing conditions-many of which are preventable, chronic conditions-we all can do better to help people stay healthier so that they can avoid future healthcare crises."

Insurers offered to end underwriting for pre-existing conditions long before the reform law, but with the caveat of an individual mandate.

"I've heard some people argue that the latter is just a boon to the insurance industry, in terms of new members," Smokler says. "That is not the case. The fact is that insurers cannot cover everybody regardless of health status if healthy people are not purchasing coverage to balance out the costs of the sick."

If the mandate is eliminated yet insurers must still accept all applicants, members will see premium increases like never before, he says.

Related Content:

News | Politics and Policy