Joy Smolnisky, director of the South Dakota Budget and Policy Project was the guest speaker this week at the Beadle County Democratic Forum. Smolnisky talked about how the Affordable Care Act could impact residents starting in January of 2014. PHOTO CONTRIBUTED
HURON — While questions over expansion of Medicaid remain, major provisions of the Affordable Care Act (ACA) take effect in January — meaning Americans who can afford health insurance will be required to buy it or face a tax penalty.
The law, passed in 2010 and upheld by the Supreme Court last June — with one significant exception — provides for a different way to distribute and access health care, said Joy Smolnisky, director of the South Dakota Budget and Policy Project.
“It changes the methodology,” she said at the Beadle County Democratic Forum last week.
“It doesn’t change the doctor-patient relationship, it doesn’t change the type of treatment that we’re going to get, but it changes who is eligible to go get health care and how it can be paid for,” Smolnisky said.
Uninsured Americans will be able to buy insurance coverage with no restrictions such as pre-existing conditions.
Nor can insurance providers charge more because of gender or deny coverage because of serious illness.
Insurance exchanges, an online process of choosing health care, will be run by either the state or the federal government. People will have the opportunity to shop for policies, comparing prices “apples to apples to apples,” she said.
Supreme Court justices upheld the individual mandate provision, requiring most Americans to purchase insurance starting Jan. 1, 2014, or pay a tax if they fail to do so.
But despite the controversy surrounding the provision, only about 7.3 million people will be impacted, since most Americans already have insurance, are exempt, qualify for Medicaid or could use tax credits to buy policies.
Many are covered through their employer or are enrolled in Medicare.
A separate, significant issue is whether states choose to expand Medicaid. The justices upheld the Affordable Care Act as constitutional last summer, but struck down the requirement of Medicaid expansion.
In South Dakota, about 93,000 people will be impacted by the health insurance exchanges. Another 116,000 who are on Medicaid can remain.
But unless Medicaid is expanded, 30,000 South Dakotans will be uninsured, which Smolnisky calls “unintended consequences of the Supreme Court decision.”
Because the law says people cannot be turned away from emergency room care, the bills for those without insurance are passed on to others with insurance.
“Those uncompensated care costs are redistributed across the consumers who consume health care,” Smolnisky said.
It is not an elected representative decision, but a business decision.
“Who are we going to shift those costs to?” she said.
For those in a big insurance group it probably means a shift on only 10 percent. But those buying their own insurance will likely see a 50 percent shift. Those paying out of pocket have no one to negotiate on their behalf and are most vulnerable to the cost shift.
States electing to expand Medicaid will see the federal government picking up the cost in full at first, but by 2020 they will be responsible for 10 percent.
They can also go in and out of the program at will, Smolnisky said.
Asked about arguments against expanding Medicaid, she said opponents call it a failed system that makes more people dependent on the government.
“So that’s the challenge,” she said. “It is, are we going to choose to put money into this through a controlled state process that ensures access through the ACA with Medicaid expansion, or do we continue to do it the way that we’re doing it now, which is by doing it with cost shifting and not affording those folks access to preventive care or to ongoing care but rather emergency care.”
For the complete article see the 05-05-2013 issue.
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