ObamaCare: What Lies Beneath
Erin B. Davis
March 23, 2016 marked the sixth anniversary of the “Patient Protection and Affordable Care Act” (aka “ObamaCare”).Many Americans praise ObamaCare for its famous expansions, including lengthening 20-somethings’ coverage under their parent’s plan to age 26 and expanding Medicaid. Unfortunately, what many Americans didn’t know is that, while approaching this monumental moment in healthcare, there was something else lurking below the surface in the nearly 2,400 pages of legislation .
Since most people would rather watch paint dry than read all those pages, here’s an analogy that touches only the tip of the iceberg known as Obamacare.
What if someone gave you $100 to spend at the grocery store each week, and allowed you to put whatever you didn't spend into a savings account? What would you do? The most logical response would be to keep your spending low so you can save some money. Maybe go for store brand shredded cheese instead of the fancy name brand package. Maybe not buy that extra item you would typically throw in the cart.
What if someone told you this is what is happening right now between the government and your doctor? Keep the number of patient procedures and diagnoses low and you, doctor, can keep a certain amount of government savings in your pocket.
See, under Obamacare there are these things called “ACOs” (Or "Accountable Care Organizations"). These ACOs are essentially groups of doctors, hospitals, and other healthcare providers that are incentivized to “keep their patients healthy” (a/k/a keep them out of the doctors’ office or hospital bed). The government and private insurance companies incentivize these groups by offering a bundled payment structure , instead of the traditional fee-for-service payment model. This means that, instead of getting paid a set price for each service rendered, the government or the private insurance company provides a lump sum pot of money to be used for a certain episode of care. For example, that one lump sum goes towards all the physician services, hospital costs, tests, medical devices, drugs, and rehabilitation needed for one episode of care. Of course, each of these service items or other associated costs diminishes the amount available in the lump sum pot. But, if your doctor can get you through a medical procedure or episode with money still left in the pot, he walks away with more money in his pocket. Less tests and procedures for you, the patient, means easy money for all the providers in these ACO models.
Boom. There’s something to get you started on this sinking ship known as ObamaCare. Think of these ACOs as the lifeboats—and watch as your doctors start leaving private practice to join these profitable groups.
Put yourself is his or her shoes. Your doctor probably spent close to ten years earning his or her medical license. Your doctor is most likely swimming in debt, and running his or her own practice comes with a heavy load of costs and expenses (i.e., employees, rent, office equipment, those delicious chocolates waiting for you at the end of your visit).
Under an ACO model, your doctor becomes an employee instead of a business owner. No more expenses to bear. No more employees to keep happy or rent to pay. Now, instead of costly overhead, your used-to-be-autonomous-doctor just has to focus on keeping patients out of the system and the money in the pot. Meanwhile, you’re left wondering whether you’ll be able to get on that lifeboat with your doctor (if your insurance would let you follow), or whether there’s another doctor left for you who hasn’t jumped ship.
Don’t worry, though. Regardless of what happens to your doctor, you’re still guaranteed “patient protection” and “affordable care” somewhere in those 2,400 pages, right?
Erin is general counsel at RLG in Tampa, FL