Here are seven healthcare trends.
1. Cost vs. benefits of healthcare reform. One of the key positive aspects of healthcare reform is the decrease in the number of uninsured Americans, with approximately 10.3 million American adults gaining health insurance coverage between January 2012 and June of this year, according to a study published in The New England Journal of Medicine.
However, to help cover the cost of providing insurance to those who gained coverage under the Patient Protection and Affordable Care Act, new taxes were created. For example, there has been a Medicare tax increase of .9 percent for individuals earning more than $200,000 or married couples earning $250,000.
In 2012, the Congressional Budget Office and Joint Committee on Taxation estimated the PPACA insurance coverage provisions would have a net cost of almost $1.1 trillion from 2012 to 2021.
The grand question is, are increased taxes and costs worth the additional insured?
2. Growth in high-deductible health plans. Employers across the country are experiencing increases in their health benefits costs, and the number of employers looking to contain costs by giving their workers more financial responsibility in the form of high-deductible health plans is on the rise. Twenty percent of employees were enrolled in a high-deductible health plan in 2013, up from just 4 percent in 2006, according to a Kaiser Family Foundation survey.
Due to rising costs, almost one-third (32 percent) of large employers plan to offer a consumer-directed health plan as their only benefit plan option in 2015, up from 22 percent in 2014, according to the results of a National Business Group on Health survey.
The high-deductible plans force consumers to pay more out-of-pocket costs. For providers, this means delays in patients choosing to get care. The increase in high deductible plans will also lead to more caution in healthcare spending by consumers overall.
3. The balancing of freedom of religion with provisions of the PPACA. In June, the U.S. Supreme Court ruled owners of closely-held for-profit businesses may refuse to provide their female employees with insurance coverage for contraceptives if the owners have religious objections to certain forms of birth control.
The PPACA requires employers to include a set of preventive services in their employees’ healthcare plans if they offer healthcare benefits, and Food and Drug Administration-approved contraceptives are on the list of mandatory preventive services.
In Burwell v. Hobby Lobby, craft chain Hobby Lobby — a company owned by Evangelical Christians — claimed the contraceptive mandate of the PPACA violated its religious liberty under the First Amendment and a 1993 federal law — the Religious Freedom Restoration Act.
The government argued for-profit corporations, such as Hobby Lobby, do not exercise religious rights as individuals and are not covered by the Religious Freedom Restoration Act.
In a 5-4 decision, the justices decided the rights of female employees to receive the full contraceptive coverage promised by the PPACA are trumped by the religious rights of company owners.
The Supreme Court reasoned that in balancing the requirement to provide contraception with the freedom of religion that the government should have found a less invasive way of providing the contraceptive coverage. The Supreme Court’s decision was seen as a significant blow to the PPACA.
4. The uncertainty of insurance subsidies. In July, two appellate courts issued conflicting decisions on whether subsidies to help pay for insurance plans are available in all states.
The PPACA states tax subsidies for health insurance are to be provided through an exchange established by the state. Based on the text of the law, lawsuits were filed challenging an IRS regulation that allows subsidies to be issued in all states.
On July 22, a divided three-judge panel of the D.C. Circuit Court of Appeals ruled tax subsidies may not be provided in states that did not establish their own exchanges. Therefore, according to the court’s ruling, if coverage was bought through a federal exchange, subsidies could not be provided.
However, just two hours later, a three-judge panel from the Fourth U.S. Circuit Court of Appeals unanimously held low- and middle-income Americans in all states can legally receive subsidies for health insurance under the PPACA.
In August, the Obama administration filed a petition for a rehearing of the D.C. Circuit case, and the petition was granted. All 13 judges of the D.C. Circuit Court of Appeals will rehear the case.
Where this case ends up landing will have a huge impact on how many people end up buying insurance on the exchanges and the success of the PPACA.
Data compiled by the Health Research Institute at PwC found the average monthly insurance premium is approximately $385. If subsidies were taken away a significant number of people would forgo signing up for coverage, as they would be unable to afford their premium.
5. Ends justify the means” politics. Concerning health insurance and the PPACA, politicians on both sides of the aisle have an “ends justify the means mentality.
On the democratic side, there is the view, for example, healthcare reform should be passed and the ends justify the means, no mater what side deals were needed, whether corrupt or not. For example, if subsidies are needed, even if not provided in the law, to assure larger numbers of people sign up for health insurance under the PPACA to ensure healthcare reform will be viewed as successful, the administration would authorize such subsidies.
In addition, there is no balancing performed of costs versus benefits, as those on the democratic side believe the cost of providing insurance under the PPACA, even if it is nearly $1.1 trillion, is worth it.
On the other side of the fence, many Republicans are so vehemently opposed to the majority of the PPACA and to President Barack Obama, they are willing to take extreme measures.
In July, in a 225-201 vote, the U.S. House of Representatives passed a resolution that gave the House GOP authorization to proceed with a lawsuit against the president. The lawsuit is narrowly focused on the PPACA and the president’s alleged abuse of authority when he decided to defer the health reform law’s employer mandate, which requires employers with 50 or more employees to provide health insurance coverage.
House Speaker John Boehner (R-Ohio) is the force behind the lawsuit, and he said the purpose of filing the complaint against the president is to protect the Constitution.
6. Broad agreement on one provision of health reform. Although views of health reform and the PPACA vary greatly by political party, there is one key concept that crosses party lines. Everyone knows someone who had a condition where they had to get a job at a big company because that is the only place they were guaranteed insurance. The vast majority of people agree that everyone should be able to obtain health insurance, even if they have a pre-existing condition.
“With such broad agreement on this issue, it is not likely” the PPACA will be completely done away with.
7. Growth in consolidation. The number of mergers and acquisitions in the healthcare industry is expected to grow over the next few years, with many health systems merging to grow their market share and lower costs.
However, provider market power also drives spending growth. Studies have found consolidation can lead to an increase of 5 percent or more in hospital prices.
There has also been an increase in vertical consolidation, with more physicians being employed by health systems. Today, more than 50 percent of physicians are employed by a health system.