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Estevan Padilla
Gail Richard
Composition II
30 March 2016
The Affordable Healthcare Act
Since the inception of the Affordable Healthcare Act (ACA) the pros and cons of this law
have been heavily debated. So much so that it has been difficult for an individual to make an
informed decision on how this law will impact them within their daily lives. Some argue that the
law will increase and expand the accessibility of care to more Americans, while others argue that
it will lead to healthcare rationing, especially for individuals that are enrolled in Medicare.
The ACA mandates that all individuals have to be insured either through Medicare,
Medicaid, private insurance, and employer sponsored group insurance, Consumer Operated and
Oriented Plan Program (CO-OP) or the Medical Exchange. If an individual is not enrolled then
they are assessed a penalty with the file their federal income tax. This is the first year that
individuals had to show proof of coverage or be assessed a penalty for the months that they were
not insured. This mandatory enrollment has increased the nations insured population. One thing
the ACA failed to do was to take into consideration that there would be a sufficient amount of
physicians to care for these new enrollees.
The hope was to make healthcare assessable to individuals who previously were not able
to receive wellness and maintenance care. What statistical data collected and analyzed has shown
though is almost a 40% increase in the use of our nations emergency room services. These

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services provided in an acute care setting are much more expensive that services provided within
a physicians office. The individuals that wrote this law should have anticipated this phenomenon
and regulated the types of service that would be allowed in an emergency room setting. A person
does not need to receive treatment in an emergency room for sinusitis. Most private payers have
limitations quoted within the plan documents that indicate when emergency room services will
be allowed. Those individuals insured through the Medical Exchange have no such limitations,
thereby increasing the cost for that population of insured individuals. Many states were given the
opportunity to set up their own health plans, referred to as CO-OP, and receive federal dollars to
subsidize the cost of the programs. Since there are no such emergency room limitations, many of
the CO-OP plans after just one year, have failed, as there were not sufficient state and federal
funds to cover the cost of treatment being provided.
One of the goals of the ACA was to regulate the Medical Loss Ratio (MLR) for insurance
companies. The MLR is the percentage of the premiums collected used for overhead,
administrative expenses versus the actual premiums used to pay claims for medical expenses that
an individual has incurred. Studies show that since the implementation of the law mandating a
minimum of 80% for small groups and 85% for large groups that the MLR for major insurance
carriers has not changed, therefore having little impact on those lines of business. There was no
marked change within these companies, because most already had standards in place to control
their administrative expenses. The ACA mandates that if an insurance company does not meet
these standards then they are required to pay a rebate to the insured, which is returning a portion
of the premiums that an insured paid into the health plan.
It should be noted though that approximately 60% of our insured population have
coverage through employer sponsored self-insured plans and these plans are exempt from the

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law. These self-insured plans are not required to contain their administrative cost, nor are they
required to report their administrative expenses to the federal government. As a result we have no
clear cut data that demonstrates if the ACA has helped regulate the administrative cost associated
with healthcare delivery and compensation.
The ACA is supposed to be our countrys way of attempting to address rising healthcare
cost since the long term life expectancy of an individual is on the increase. As previously stated
the goal of the ACA is to make healthcare less expensive and more assessable. The average
percentage of premium increase per year decreased from 9% in 2011 to 3-4% in 2012. At this
point it is too early to tell if the ACA is having the desired effect, keeping in mind that many of
the self-insured plans are not regulated at the same level as fully-insured health plans and the
failure of many CO-OP plans within the first year, in fact 8 of the 23 originally established have
failed, leaving nearly 200,000 individuals scrambling to obtain insurance coverage.
At this time we are unable to document the claim that the Affordable Care Act will bring
down unemployment, nor can we verify that it has slowed the growth of healthcare cost, as selfinsured plans, which is where a majority of Americans are insured through with the employer
are not required by law to report. We can verify that the benefit limitations that plans previously
had in place for their members has been removed and there are individuals who are benefiting
from this modification, placing less of the financial burden on their families. The mandate for
certain preventive services to be covered with no patient responsibility has been a great benefit
for those individuals that are covered through self-insured or fully insured plans. Why it is true
that a person can leave their employment and not be denied private insurance, the excessive
premium cost of those individuals with pre-existing medical conditions is exorbitant and can
place a hardship on an individual.

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Three positive side effects of the Affordable Care Act are cost transparency, Medicare
scrutiny and technical investment. For cost transparency it is good to hold a hospital accountable
for charging a patient $15.00 per pill on one of their prescribed medication, when they are able to
get that same pill through their local pharmacy for $4.00. Hospitals are now required to provide
this information. Hospitals are also now required to report services that should never have been
provided, or that were provided in error, during a hospital confinement, which are referred to as
never events. If these events lengthened the confinement of an individual the hospital does not
receive reimbursement for those days. With so many fraudulent Medicare claims the additional
scrutiny that the Medicare intermediaries and the providers receive now, which require adequate
documentation to support the services provided, is in itself outstanding. With todays technical
demands, requiring that all healthcare information should be exchanged in an electronic format,
whether it be eligibility, claims, medical records or medical claims payments, more and more
technical companies are scrambling to provide programming and software applications to
address these needs.
There have been employers that as a result of being mandated to provide healthcare
coverage, who have actually decreased the amount of hours an employee works each week to
circumvent the requirement. Employers have had to make a choice, which in some cases has
altered the services they are providing. This article about a community college is a perfect
example. In the long run it is the people that the Affordable Care Act that was designed help that
are baring the financial burden, due a decrease income.
Is the Affordable Care Act working, are their more insured Americans? We have only
completed our first year of government mandated insurance coverage. As previously stated many
of the states that had opted for private-option, CO-OP plans, to use federal funds to subsidize

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premiums, have petitioned Washington to withdraw and participate in Medicaid expansion only.
These CO-OP plans that have failed within the first year, leaving thousands of individuals
without health insurance. With self-insured plans insuring the majority of our countrys
population and not being held to the same reporting standards as Medicare, Medicaid and fully
insured plans, any data that we are able to extrapolate would not truly reflect the affects the ACA
has had on healthcare delivery and cost. At this time it is too early to tell and we have to take any
publication that we may read with a grain of salt.

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Works Cited
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Procon.org, 21 July 2015. Web. 21 Feb. 2016.
Day, Benjamin, David D. Himmelstein, Michael Broder, and Steffie Woolhandler. "THE
AFFORDABLE CARE ACT AND MEDICAL LOSS RATIOS: NO IMPACT IN FIRST
THREE YEARS." Pros and Cons of Obamacare: Is It What the United States Needs?
(n.d.): 127-31. Healthcare-now.org. Healthcare-now.org. Web.
"The Patient Protection and Affordable Care Act (ACA): Pros and Cons." Paperity. Paperity
Open Science Aggregated, Feb. 2013. Web. 20 Feb. 2016.
Jr., Tom Howell. "Obamacare Co-op Flops Have Many Running for Coverage." Washington
Times. The Washington Times, 15 Nov. 2015. Web. 30 Mar. 2016.
Furman, Jason. Six Economic Benefits of the Affordable Care Act. Web log post. White
House. The White House, 6 Feb 2014. Web. 2 Feb. 2016.
Powers, Janis. "The Side Effects of Obamacare Are Just What the Doctor Ordered." The
Huffington Post. TheHuffingtonPost.com, 06 Sept. 2015. Web. 02 Mar. 2016.
Snyder, Tom. "The Negative Impact of the Affordable Care Act on Community Colleges." The
Huffington Post. TheHuffingtonPost.com, 05 May 2014. Web. 02 Mar. 2016.
"The Affordable Care Act Is Working." HHS.gov. U.S. Department of Health & Human Services,
07 Oct. 2014. Web. 24 Feb. 2016.