Description
5 discussion questions. Answers must be at least 40 words each. APA format with at least two scholarly resources. I have attached chapter 7 in case you need it.
Sara E. Wilensky and Joel B. Teitelbaum
When I took office, health care costs had risen rapidly for decades, and tens of millions of Americans were uninsured. Regardless of the political difficulties, I concluded comprehensive reform was necessary. The result of that effort, the Affordable Care Act (ACA), has made substantial progress in addressing these challenges. Americans can now count on access to health coverage throughout their lives, and the federal government has an array of tools to bring the rise of health care costs under control. However, the work toward a high-quality, affordable, accessible health care system is not over. (Obama, 2016, p. 526)
Discussion Question 1
Even though the primary legislative bills to repeal and replace the Affordable Care Act (ACA)—the AHCA and BRCA—did not have sufficient support across U.S. Congress to become law, and some of their provisions may not have been allowed under reconciliation rules, it is worth considering the main features of the bills to understand the type of health reform changes many Republicans support (see TABLE 7-1). Overall, these bills reduced taxes, eliminated government mandates, lowered federal government spending, lowered premiums for some people while increasing them for others, phased out the Medicaid expansion under the ACA, and ended Medicaid as an entitlement program. According to the nonpartisan Congressional Budget Office (CBO), the effect of the bills would be to significantly increase the number of uninsured, significantly reduce the deficit, lower costs for young and healthy consumers, and increase costs for older and poorer consumers (Congressional Budget Office, June 26, 2017; Congressional Budget Office, July 23, 2017). Everyone agrees the ACA can be improved. Are there features of these bills that you think have merit? Should states have more flexibility under the ACA? How much of the cost burden should young and healthy individuals bear in order to make health insurance more affordable for elderly and sicker individuals?
Discussion Question 2
Are there alternatives to the individual mandate that accomplish the same goals without engendering so much political turmoil? Could policymakers have designed an incentive system that would be as effective as a mandate? What are the pros and cons of using a mandate versus an incentive? Can you think of incentives to encourage enrollment that have occurred in other parts of the healthcare system?
Discussion Question 3
There was a lengthy debate about whether to include a public option in health reform. A public option is some type of government-run health plan that would be available to compete with private plans. A public option could exist within the health exchange model or outside of it. Instead of a public option, Congress voted to require the Office of Personnel Management, which runs the Federal Employees Health Benefit Program, to contract with at least two multistate plans in every state health insurance exchange.
What are the pros and cons of having a public option? Does the Office of Personnel Management compromise achieve all or some of the goals of having a public option? Why do you believe the Office of Personnel Management compromise was acceptable to legislators but the public option was not?
Discussion Question 4
Republican policymakers that are involved in bipartisan discussions to revise the ACA are focused on providing states with increased flexibility regarding benefit design, premium pricing, and other features. Although states are generally home to social welfare changes, it is difficult to provide universal health care on a state-by-state basis. If state health reform efforts lead the way, the country could have a patchwork of programs and policies that vary from state to state, with the potential to make health coverage even more complex and inefficient than it is currently. On the other hand, it is also important to recognize that a health reform strategy focusing on states has benefits as well. At its best, state-level reform can be accomplished more rapidly and with more innovation than at the federal level. State legislatures may have an easier time convincing a narrower band of constituents important to the state than Congress has in accommodating the varied needs of stakeholders nationwide.
What are the advantages and disadvantages of compromising regarding the state role in the ACA? Is it worth giving up some degree national uniformity and stronger consumer protections in exchange for political stability and allowing state to experiment with health reform design? How well do you think the public will be served in their access to affordable health insurance and access to health care if states have more control? How does your response differ if you are living in California or New York versus Texas or Florida?
Discussion Question 5
A group of friends were talking about the Affordable Care Act (ACA), illustrating the wide-ranging viewpoints about the law. Calvin, whose daughter Mia is struggling to make a living as an artist, is pleased that Mia has health insurance for the first time since graduating from college. Although Mia cannot stay on her parents’ insurance because she just turned 27, she can now afford a good health insurance plan that she found on her state’s health exchange. While Calvin has not noticed much of a change in his own health insurance coverage, which he obtains through his government employer, his friend Katherine is upset about health reform. She does not want the government forcing her to purchase health insurance (although she always chose to be insured in the past), and she recently found out that her old plan was cancelled because it did not meet the law’s requirements. Katherine found several new plan options to choose from, but none had her exact combination of benefits, providers, and price. In addition, Katherine’s uncle, Ethan, is 55 years old and self-employed. He purchases his health insurance on his state’s exchange and because he has preexisting conditions, he is grateful to be able to find a plan. Even so, Ethan’s premiums will increase by 15% this year and his deductible is $5,000, making health care difficult to afford even with insurance. Another friend, Jara, told Katherine she should be willing to pay a little more or change some aspects of her plan to help the millions of people who can now afford insurance for the first time as a result of the ACA. After witnessing her uncle’s experience, however, Katherine is skeptical that the government is going to be able to keep its promises.
What are the competing viewpoints about the ACA exemplified by these friends? Which of these friends’ views will be the most pressing concern going forward in the discussions about the ACA?
Unformatted Attachment Preview
Health Reform in the United States: Recent and Past History
The array of problems facing the healthcare system has led to numerous health reform proposals and
implemented policies. The concept of health reform can have several different meanings. Given the
patchwork health insurance system, health reform often refers to changes that seek to reduce the
number of uninsured. Due to the high and increasing cost of healthcare services, health reform might
also include changes that seek to contain costs and control utilization. The notion of health reform could
also address other shortcomings, such as trying to reduce medical errors, strengthening patient rights,
building the public health infrastructure, and confronting the rising cost of medical malpractice
insurance. The Affordable Care Act (ACA), the federal health reform law passed in 2010, touches on
many of these issues (Patient Protection Affordable Care Act, 2010).
Health reform has been difficult to achieve in the United States. Many reform efforts have been
attempted, with varying degrees of success, on a national level. Numerous authors have addressed the
main factors that deter significant social reform in this country, including health reform (Blake &
Adolino, 2001; Gordon, 2003; Jost, 2004). Factors that are prominently discussed include the country’s
culture, the nature of U.S. political institutions, the power of interest groups, and path dependency (i.e.,
the notion that people are generally opposed to change).
Americans have a complicated and partisan view of the proper role of the federal government in the
healthcare arena. On one hand, 60% of respondents to a 2017 survey felt that the federal government
has a responsibility to ensure healthcare coverage for all Americans (Pew Research Center, 2017). This is
much higher than the 47% who shared that view in 2010, at the height of the health reform debate
(Newport, 2010). Of those who supported federal intervention in the 2017 survey, 33% would like to see
a single-payer system developed (Pew Research Center, 2017).
At the same time, there was a stark difference of opinion based on the respondent’s political views.
While 85% of Democrats and Democrat-leaning independents believed the federal government was
responsible for ensuring healthcare coverage, only 32% of Republicans and Republican-leaning
independents agreed (Pew Research Center, 2017). Even so, over half (57%) of Republicans and
Republican-leaners supported the continuation of Medicaid and Medicare, the country’s largest public
health insurance programs. Furthermore, only 5% of respondents thought the federal government
should not have any role in ensuring healthcare coverage (Pew Research Center, 2017).
Many aspects of the U.S. political system also make it difficult to institute sweeping reform. For
example, although presidents have significant influence on policy agenda setting and proposing budgets,
they have limited power to make changes without the assistance of the U.S. Congress. The federal
government is often politically divided, with different parties holding power in the executive and
legislative branches. This division often results in partisanship and policy inaction due to different policy
priorities and views.
Furthermore, although members of Congress may ride the coattails of a popular president from their
own party, they are not reliant on the president to keep their jobs. The issues and views their
constituents care about most may not align with the president’s priorities. In those cases, members of
Congress have a strong incentive to adhere to the wishes of those who vote for them, instead of simply
following the president’s lead. Barring an overwhelming wave of discontent, as occurred in the 2010
midterm elections when Democrats suffered historic losses in Congress, it is usually difficult to unseat
incumbents. Even when there is a historic level of turnover, reelection rates remain very high. For
example, 97% of House incumbents successfully defended their seats in 2016; even in the Senate, where
turnover is relatively more common, 93% of incumbents won reelection in 2016 (Kondick & Skelley,
2016). As a result, legislators in Congress may have confidence in focusing on their district’s or state’s
needs before those of the entire nation.
Federal legislative rules also support inaction or incremental reform over sweeping changes. In the U.S.
Senate, 60 (of 100) votes are needed to break a filibuster in most cases. Thus, even the political party in
the majority can have difficulty effectuating change. One exception to the filibuster rule is the
“reconciliation” process, which allows bills to pass with only 51 votes. Reconciliation is used as part of
the budgetary process, and bills passed via reconciliation: (a) may not be filibustered (so can pass with
51 votes), (b) can only pertain to federal revenue and spending issues, (c) must comply with spending
and revenue targets set forth in the budget resolution, and (d) must adhere to other budgetary rules
(Tax Policy Center, 2017). The reconciliation process is being increasingly used when one party maintains
a slim majority and that party cannot find 60 votes to pass a bill. In 2010, the Democrats used a
reconciliation bill to pass the ACA after they lost their filibuster-proof majority, and recently, the
Republicans attempted to use a reconciliation bill to pass their ACA repeal and replace bills.
Historical Attempts and Failures at Health Reform
Since the early 1900s, when medical knowledge became advanced enough to make health care and
health insurance desirable commodities, there have been periodic attempts to implement universal
coverage through national health reform. The Socialist Party was the first U.S. political party to support
health insurance in 1904, but the main engine behind early efforts for national reform was the American
Association for Labor Legislation (AALL), a “social progressive” group that hoped to reform capitalism,
not overthrow it (Starr, 1982, p. 243). In 1912, Progressive Party candidate Theodore Roosevelt
supported a social insurance platform modeled on the European social insurance tradition that included
health insurance, workers’ compensation, old-age pensions, and unemployment insurance. After his loss
to Woodrow Wilson, the national health insurance movement was without a strong national leader for
three decades.
The AALL continued to support a form of health insurance after Roosevelt’s defeat and drafted a model
bill in 1915. This bill followed the European model, limiting participation to working class employees and
their dependents. Benefits included medical aid, sick pay, maternity benefits, and a death benefit. These
costs were to be financed by employers, employees, and the state. The AALL believed that health
insurance for the working population would reduce poverty and increase society’s productivity and wellbeing through healthier workers and citizens.
Opposition to AALL’s bill came from several sources (Starr, 1982, pp. 247–249). Although some members
of the American Medical Association (AMA) approved of the bill conceptually, physician support rapidly
evaporated when details emerged about aspects of the plan that would negatively impact their income
and autonomy. The American Federation of Labor (a labor union) opposed compulsory health insurance
because it wanted workers to rely on their own economic strength, not the state, to obtain better wages
and benefits. In addition, the federation was concerned that it would lose power if the government, not
the union, secured benefits for workers. Employers were generally opposed to the bill, contending that
supporting public health was a better way to ensure productivity. In addition, they feared that providing
health insurance to employees might promote malingering instead of reducing lost workdays. After
experiencing the high cost associated with workers’ compensation, employers also were not eager to
take on an additional expensive benefit. Of course, the part of the insurance industry that had already
established a profitable niche in the death benefit business was strongly opposed to a bill that included
a death benefit provision. Employers, healthcare providers, and insurers have, in general, remained
staunch opponents of national health reform over the years, whereas unions have supported national
reform efforts. However, this dynamic has changed recently with more provider groups, employers, and
even some insurers calling for a national solution to the problems of rising healthcare costs and the
uninsured.
The country’s entry into World War I in 1917 also changed the health reform debate. Many physicians
who supported the AALL bill entered the military, shifting their focus away from the domestic health
policy debate. Anti-German sentiment was high, so opponents of the bill gained traction by denouncing
compulsory health insurance as anti-American. One pamphlet read: “What Is Compulsory Social Health
Insurance? It is a dangerous device, invented in Germany, announced by the German Emperor from the
throne the same year he started plotting and preparing to conquer the world” (Starr, 1982, p. 253).
The next time national health insurance might have taken hold was from the mid-1930s through the
early 1940s as the country was coping with the difficulties of the Great Depression. During this time
there was a significant increase in government programs, including the creation of Social Security in
1935, which provided old-age assistance, unemployment compensation, and public assistance. Yet the
fourth prong of the social insurance package, health insurance, remained elusive. President Franklin
Roosevelt heeded his staff’s advice to leave health insurance out of Social Security because of the strong
opposition it would create (Starr, 1982, p. 267). Opposition from the AMA was particularly strong—they
believed that “socialized medicine” would increase bureaucracy, limit physician freedom, and interfere
with the doctor–patient relationship.
Even so, members of Roosevelt’s administration continued to push for national health insurance. The
Interdepartmental Committee to Coordinate Health and Welfare Activities was created in 1935 and took
on the task of studying the nation’s healthcare needs. This job fell to its Technical Committee on Medical
Care. Instead of supporting a federal program, the committee proposed subsidies to the states for
operating health programs. Components of the proposal included expanding maternal and child health
and public health programs under Social Security, expanding hospital construction, increasing aid for
medical care for the indigent, studying a general medical care program, and creating a compensation
program for those who lost wages due to disability.
Although President Roosevelt established a National Health Conference to discuss the recommendation,
he never fully supported the Medical Care Committee’s proposal. With the success of conservatives in
the 1938 election and the administration’s concerns about fighting the powerful physician and state
medical society lobbies, national health reform did not have a place on Roosevelt’s priority list. Senator
Robert Wagner (D-NY) introduced a bill that followed the committee’s recommendations in 1939, and
although it passed in the Senate, it did not garner support from the president or from the House.
World War II provided another opportunity for the opposition to label national health insurance as
socialized medicine. But once the war neared an end, President Roosevelt finally called for an “economic
bill of rights” that included medical care. President Truman picked up where Roosevelt left off, strongly
advocating for national health insurance. President Truman’s proposal included expanding hospitals,
increasing public health and maternal and child health services, providing federal aid for medical
research and education, and, for the first time, a single health insurance program for all (Starr, 1982, p.
281). Heeding lessons from earlier reform failures, Truman emphasized that his plan was not socialized
medicine and that the delivery system for medical and hospital care would not change.
Again, there was strong opposition to the proposal. The AMA vehemently rejected the proposal, and
most other healthcare groups opposed it as well. Although the public initially approved of it, there was
no consensus about how national health insurance should be structured, and more people preferred
modest voluntary plans over a national, compulsory, comprehensive health insurance program (Starr,
1987, p. 282). Additional opposition came from the American Bar Association, the Chamber of
Commerce, and even some federal agencies concerned about losing control over their existing
programs. In the end, only the hospital construction portion of the proposal was enacted.
When Truman won reelection on a national health insurance platform in 1948, it appeared the tide had
turned. However, the AMA continued its strong opposition and its attempts to link national health
insurance to socialism. Congress considered various compromises but never reached a consensus. The
public remained uncertain about what kind of plan to favor. Employers maintained their opposition to
compulsory insurance. In addition, one large group of potential supporters—veterans—was
disinterested in the debate because they had already secured extensive medical coverage through the
Veterans Administration. As the Korean War moved forward, Truman’s focus shifted away from national
health insurance and toward the war effort and other priorities.
National health insurance did not return to the national policy agenda until the 1970s. The landscape
then was quite different from Truman’s era. Medicaid and Medicare had been created, healthcare costs
had begun to rise exponentially, and the economy was deteriorating. In 1969, President Nixon declared
that a “massive crisis” existed in health care and that unless it was fixed immediately, the country’s
medical system would collapse (Starr, 1982, p. 381). The general public seemed to agree, with 75% of
respondents in one survey concurring that the healthcare system was in crisis (Starr, 1982, p. 381).
Democrats still controlled Congress by a significant margin, and Senator Edward Kennedy (D-MA) and
Representative Martha Griffiths (D-MI), the first woman to serve on the powerful House Committee on
Ways and Means, proposed a comprehensive, federally operated health insurance system.
At the same time, a movement supporting health care and patient rights was gaining momentum. These
included rights to informed consent, to refuse treatment, to due process for involuntary commitment,
and to equal access to health care (Starr, 1982, p. 389). The public was both anxious to obtain care and
willing to challenge the authority of healthcare providers.
The Nixon administration’s first attempt at health reform focused on changing the healthcare system’s
financing from one dominated by a fee-for-service system, which created incentives to provide more
and more expensive services, to one that promoted restraint, efficiency, and the health of the patient.
The result was a “health maintenance strategy” intended to stimulate the private industry to create
health maintenance organizations (HMOs) through federal planning grants and loan guarantees, with
the goal of enrolling 90% of the population in an HMO by the end of the 1970s (Starr, 1982, pp. 395–
396). Ironically, group health plans, often labeled socialized medicine, had become the centerpiece of a
Republican reform strategy.
Nixon’s proposal included an employer mandate to provide a minimum package of benefits under a
National Health Insurance Standards Act, a federally administered Family Health Insurance Program for
low-income families that had a less generous benefit package than the one required by the National
Health Insurance Standards Act; reductions in Medicare spending to help defray the costs; a call for an
increase in the supply of physicians; and a change in how medical schools were subsidized. Opponents
were plentiful, and this plan did not come to fruition. Some believed the plan was a gift to private
insurance companies. Advocates for the poor were outraged at the second tier of benefits for lowincome families. The AMA was concerned about HMOs interfering with physician practices and
supported an alternative that provided tax credits for buying private insurance.
After the 1972 election, Nixon proposed a second plan that covered everyone and offered more
comprehensive coverage. Private insurance companies would cover the employed and a governmentrun program would cover the rest of the population, with both groups receiving the same benefit
package. Senator Kennedy and Representative Wilbur Mills (D-AR) supported a similar plan, and it
appeared a compromise was close at hand. However, labor unions and liberal organizations preferred
the original Kennedy plan and resisted compromising with the hope of gaining power in the 1974 postWatergate elections. Fearing the same political shift, insurance companies actually supported a
catastrophic insurance plan proposed by Senator Russell Long (D-LA), believing it was better than any
plan that would come out of a more liberal Congress after the elections. Once again, there was no
majority support for any of the bills, and a national health insurance plan was not enacted.
Although President Jimmy Carter gave lip service to national health reform, he never fully supported a
proposal. It was not until the election of Bill Clinton in 1992 that the next real attempt at national health
insurance was made. The Clinton administration plan, dubbed the Health Security Act, was designed to
create national health insurance without spending new federal funds or shifting coverage from private
to public insurance. It relied on the concept of “managed competition,” which combined elements of
managed care and market competition.
Under the Health Security Act, a National Health Board would have established national and regional
spending limits and regulated premium increases. “Health alliances” would have included a variety of
plans that were competing for the business of employees and unemployed citizens in each geographic
area. All plans were to have a guaranteed scope of benefits and uniform cost sharing. Employers would
have been required to provide coverage for their workers at a defined high level of benefits, and those
with 5,000 employees or fewer would have had to purchase plans through the health alliance. Subsidies
were provided for low-income individuals and small businesses. Funding was to be provided from costcontainment measures that were reinvested. Forced by the Congressional Budget Office (CBO) to
provide an alternative funding strategy should the cost containment not create enough funds, the plan
also included the option of capping insurance premium growth and reducing provider payments.
Like the national health insurance plans before it, the Health Security Act had opponents from many
directions. The health alliances were attacked as big government, employers resisted mandates and
interference with their fringe benefits, some advocates feared that cost containment would lead to care
rationing, the insured were concerned about losing some of their existing benefits or cost-sharing
arrangements, the elderly feared losing Medicare, and academic health centers were concerned about
losing funds based on new graduate medical education provisions. In addition, the usually strong
support from unions was missing because of an earlier disagreement with the president on trade
matters. It is also generally accepted that the Clinton administration made several political mistakes that
made a difficult political chore nearly impossible. The Health Security Act never made it to a vote.
The ACA Becomes Law
In many ways, 2010 was a very unlikely year to pass a national health reform plan. The country had been
growing increasingly ideological, with the popular and electoral votes almost evenly split in both the
2000 and 2004 presidential elections. Even though Barack Obama won the electoral vote in a landslide
over John McCain (365 to 173), only 53% of the population voted for Obama in 2008 (CNN, 2008).
In addition to the ideological divide, and against a backdrop of a faltering economy, partisan differences,
and the recent passage of two massive government spending bills, President Obama pursued a national
health reform plan. Given the history of failed reform efforts, it would have been an accomplishment to
pass health reform in the best of times, and clearly this was not the best of times.
Health care has long been a priority for Democrats, and President Obama was no exception. Perhaps
Obama’s dedication to passing health reform stemmed in part from his personal experience: Obama’s
mother died of ovarian cancer, and he had seen her worry about paying her medical bills as much as
beating the disease (CNN, 2007). Thus, for Obama, signing comprehensive health reform legislation into
law would represent the opportunity to make sure that others would not endure the same experience.
Health reform efforts did not begin smoothly. President Obama initially wanted former U.S. senator Tom
Daschle to run both the U.S. Department of Health and Human Services (USDHHS) and the White House
Office on Health Reform. It was thought that his experience in the Senate and relationships with
legislators were the right combination to take the lead on health reform. When his nomination was
derailed due to personal tax problems, it was not a good omen. As deliberations in Congress lagged,
Democrats were not able to present a bill to President Obama before recessing for the summer. During
the summer of 2009, members of Congress went home to their constituents and held town hall
meetings to discuss health reform. Some of the meetings erupted in vocal opposition to health reform,
and the media focused on these town hall meetings throughout the summer. Obama and the Democrats
were criticized for losing the momentum for reform by letting the debate linger.
At the same time, there were several instances when the health reform effort appeared politically
doomed, and President Obama’s leadership made a clear difference. Obama attempted to reclaim the
upper hand on health reform with a speech to a joint session of Congress in September 2009. He
memorably proclaimed, “I am not the first president to take up health reform, but I intend to be the
last” (The New York Times, 2009). Although public support for health reform had been on the decline for
several months, September 2009 polls showed that 62% still thought it was important to address health
reform at that time, and 53% thought the country as a whole would be better off if health reform
passed (Kaiser Family Foundation, 2009). Less support existed for the Democrats’ specific reform
proposal, however, with 46% in support of the proposed change and 48% opposed to it (Cohen & Baltz,
2009).
In January 2010, an event occurred that some assumed was the death knell of health reform. In the
2008 elections, Democrats had made significant gains in Congress, earning a 59–41 majority in the
Senate and a 257–178 majority in the House. Furthermore, Senator Arlen Specter of Pennsylvania
switched parties, giving Democrats the crucial 60th vote needed for a filibuster-proof majority. Although
the numbers were now in their favor, President Obama, Senate Majority Leader Harry Reid (D-NV), and
House Speaker Nancy Pelosi (D-CA) would have to balance the competing interests of conservative
Democrats who were concerned with having too much government intervention, progressive Democrats
who sought a public insurance option to compete with private companies, Blue Dog Democrats who
were most concerned with fiscal discipline, and pro-life and pro-choice factions who would battle over
whether and how abortion services would be included in any health reform bill.
The Obama administration tried to avoid events that doomed earlier health reform efforts. Although the
failed effort by the Clinton administration probably provided the most relevant lessons, Obama
confronted some of the same obstacles that reformers had faced decades earlier. At times, President
Obama was accused of learning some of the lessons too well, swinging the pendulum too far to the
other side. Obama was not alone in providing leadership on health reform. Reid’s and Pelosi’s
determination to see health reform succeed, and their skill in mobilizing and controlling their caucuses,
were essential to the passage of the ACA. It is likely that health reform would not have passed without
the skillful efforts of all three leaders working together. Even so, it is clear that the health reform effort
would not even have begun without a president who put health reform at the top of the agenda and
stuck with it despite the pitfalls and political opposition.
The legislative process for completing the bill was long, rocky, and ultimately partisan. The House of
Representatives moved more quickly and with less fractious debate than the Senate. Instead of having
multiple House committees work on competing bills, as occurred during the Clinton administration,
House Democratic leaders created a “Tri-Committee” bill jointly sponsored by Charles Rangel (D-NY),
Henry Waxman (D-CA), and George Miller (D-CA), the chairmen of the House Ways and Means, Energy
and Commerce, and Education and Labor (later renamed the Education and Workforce committee)
committees, respectively. On November 7, 2009, the House passed its health reform bill with only two
votes to spare, 220–215 (Affordable Health Care for American Act, H.R. 3962, 2009). Only one
Republican voted for it, and 39 conservative Democrats voted against it. The bill from the then-moreliberal House contained several provisions that were likely to be rejected by the Senate: a public health
insurance option to compete with private plans, a national health insurance exchange instead of statebased exchanges, more generous subsidies for low-income individuals, a broader expansion of
Medicaid, and higher taxes on wealthier Americans.
Finance Committee Chairman Max Baucus (D-MT) led the effort in the Senate. The legislative process he
established was lengthy, and some observers believed he compromised on too many issues in an
attempt to forge a bipartisan bill. For a time Senator Charles Grassley (R-IA) actively participated in the
health reform deliberations, and a few other Republican senators appeared willing to consider a
bipartisan measure. Ultimately, however, a bipartisan agreement could not be reached. In a 2009
Christmas Eve vote, the Baucus health bill passed 60–39, with all Democrats and two Independents
voting for the measure and all Republicans voting against it (Patient Protection and Affordable Care Act,
H.R. 3590, 2009).
Following tumultuous disagreements with versions of the plan, and the loss of a filibuster-proof
majority, the House and Senate leaders agreed to use the budget reconciliation process to amend the
Senate bill. The House then passed the Senate version of the bill along with a companion reconciliation
bill that amended certain aspects of the Senate bill. The reconciliation bill included more generous
subsidies for individuals to purchase insurance than existed in the standalone Senate bill, the closure of
the Medicare Part D doughnut hole, a tax on more generous insurance plans, changes to the penalties
on individuals who would not buy insurance and for employers that would not offer insurance, and an
increase in Medicare and investment taxes for higher earners. The Senate then passed the reconciliation
bill. Once again, the final vote to approve the bills was along party lines. The House approved the Senate
bill by a vote of 219–212, with all Republicans and 34 Democrats voting against it (Khan, 2010).
President Obama signed the bill into law on March 23, 2010 (Patient Protection Affordable Care Act,
2010).
Some observers argue that Obama may have overlearned the lesson about working with Congress, and
that in doing so, he did not provide enough guidance to legislators and allowed the debate over health
reform to linger for too long (Morone, 2010, p. 1097). On the one hand, it is difficult to criticize Obama’s
approach because he was ultimately successful. On the other hand, could the problems stemming from
the 2009 town halls have been avoided? Would public opinion of the health reform effort be higher if
the process had been better managed? Only time will tell whether Obama was successful over the long
term. With the volatility and divisive partisan bickering of today’s Congress, what the future holds is still
unclear.
Overview of the Patient Protection and Affordable Care Act
While President Obama left the details of health reform legislation to Congress, he did lay out what he
believed to be the most important principles that should guide the legislation’s development. Soon after
becoming president in 2009, Obama delineated those principles, saying that any health reform measure
should do the following:
Protect families’ financial health (slowing the growth of out-of-pocket expenses and protecting people
from bankruptcy due to catastrophic illness).
Make health insurance coverage more affordable (reducing administrative costs, wiping out
unnecessary tests and services, and limiting insurers’ ability to charge higher premiums for certain
populations).
Aim for insurance coverage universality.
Provide portability of insurance coverage.
Guarantee choice of health plans and providers (including keeping current ones).
Invest in disease prevention and wellness initiatives.
Improve patient safety and healthcare quality.
Maintain long-term fiscal sustainability (reducing cost growth, improving productivity, and adding new
revenue sources).
The extent to which these principles were brought to life in what eventually became the Affordable Care
Act lives along a spectrum: for example, (1) health insurance was absolutely made more affordable for
millions of people; (2) disease prevention and wellness initiatives seem to be gaining momentum,
though slowly; and (3) universal insurance coverage was absolutely not achieved. Whatever the case
with any particular principle, it is instructive to look to four key reforms that became law under the ACA
as having paved the way for President Obama’s overall vision to come to fruition. These four reforms
essentially reordered long-standing relationships among health system stakeholders (individuals,
providers, insurers, employers, governments, etc.). As a result of this reordering, all of these
stakeholders were legally obligated to alter normative behaviors. These changes include: (1) mandates
(individual and employer); (2) changes to private insurance rules; (3) creation of health insurance
exchanges; and (4) expansion of Medicaid.
The first major mandate change, known as the individual mandate, is a requirement that most
individuals maintain “minimum essential health coverage” (i.e., health insurance) or face financial
penalties that are spelled out in the ACA. This requirement was a critically important beam in the ACA
architecture; because it creates a new, large pool of individuals who will be paying premiums to
insurance companies, it created leverage for policymakers who were eager for private insurers to accept
many of the ACA’s other insurance reforms that may otherwise have been unpalatable. For certain
individuals whose socioeconomic status makes it impossible for them to purchase (or gain through an
employer) the type of minimum coverage mandated by the ACA, and who do not qualify for Medicaid
(even under the ACA expansion), federal subsidies are made available under the law.
The individual mandate is an essential part of health reform for several key reasons:
Adverse selection: Without the mandate, people who are in poor health or otherwise expect to use
more healthcare services would be more likely to purchase health insurance, while healthier people
would be more likely to opt out of insurance coverage. This would lead to an insurance pool that is
relatively sick and thus more expensive, a problem referred to as adverse selection.
Free riders: Without the mandate, some healthy individuals would choose not to purchase health
insurance but then later need health care, and they will likely receive some care even though they are
uninsured. This is especially true if the individuals have the resources to pay for healthcare services.
These individuals are referred to as free riders bec
