JEFFREY BROWN: And now to the real-world impact of all this.
Ray Suarez will talk with some key players in the health care field.
But we begin with an overview from Susan Dentzer, editor in chief of the journal Health Affair and an analyst for the NewsHour.
So, Susan, in some sense, its status quo, right? Things proceed rather than stop in their tracks.
SUSAN DENTZER: That’s right. Barring a change in the administration, a change in the composition or control of Congress or overcoming the broad group of stakeholders that pushed to pass the Affordable Care Act in the first place, barring all of that, it’s status quo and we move forward.
JEFFREY BROWN: All right, so let’s talk about what that means, what will happen and when.
put some — we will keep talking about this idea of a mandate. It’s a broad idea. What specifically happens over — and when?
SUSAN DENTZER: So will what will happen is, in 2014, when the exchanges that are going to roll out in various states are up and running, individuals who don’t currently have insurance, who have to purchase it on the individual market or who work for small businesses, will be able to buy that coverage through the exchanges.
If they do not do that at that point, and they elect to go without coverage, they will be subject to the penalty. The penalty starts small in 2014. You won’t pay it until the following year, when your taxes are due. Starts small, $95 for an adult, a maximum of 1 percent of total family income, whichever is greater. It phases up in 2016 to $695 maximum for an adult; 2.5 percent of total income for a family is the maximum it can be.
And that’s where it stops and stays there, at least until someone changes the law again.
JEFFREY BROWN: Now, some areas of coverage, such as preexisting conditions, already have kicked in for some people, right? But for everybody, when does that — how does that happen?
SUSAN DENTZER: Some — a good way to think about it is, let’s talk about the 257 million Americans who already have coverage. A lot of things are already in effect that apply to them, no more lifetime limits on insurance policies.
So it will never be the case that you’re so sick and spend so much money that your insurance cuts out, maxes out. That’s gone. For example, adult children, the one everybody knows is adult children now can stay on their parents’ policy up to the age of 26.
JEFFREY BROWN: That’s already started.
SUSAN DENTZER: That’s already started for everybody.
Preexisting condition restrictions cannot be held against children. That has already gone into effect again for everybody. So there are a number of those provisions already in effect for everyone. Most of the insurance reforms, however, will not take effect until 2014.
And, again, they apply largely to the relatively smaller group of Americans who are buying individual coverage, and to some degree to people who are getting coverage through the small business market. That is when, for individuals buying coverage through the exchanges in 2014, no more preexisting condition restrictions against them. There is guaranteed issue, as it said, of insurance at that point.
And anybody who wants to get an insurance policy will be able to get one. In addition, depending on your income level, you will be able to do that with the assistance of federal subsidies.
JEFFREY BROWN: All right, now — now, crucially, the Medicaid expansion, we started talking about that with Marcia earlier. We heard the lawmakers before. What’s most important, from your perspective, in thinking about how — what happens next?
SUSAN DENTZER: Well, the most important thing is, number one, that the expansion moves forward and is constitutional.
But, number two, what the court clearly said is that if states elected for some reason not to expand coverage and not to take what is really a lot of federal money up front to do that — keep in mind the federal government pays 100 percent of the cost of this for several years, and then it drops down to 90 percent of the cost eventually.
So the federal government is paying most of the share. If states nonetheless elect not to take that money, not to expand coverage to these people, they can do that, and the federal government cannot come back and take away all of the Medicaid money that those states now get from the federal government.
So what in effect the court has done, it appears, is given states the option to turn down the expansion, turn down the dollars, and not suffer any other consequences by way of losing federal support for the rest of their Medicaid program.
JEFFREY BROWN: Now, in thinking about what they may or may not do and which states may or may not act, 26 states had sued the original act. Right? Remind us of their rationale in opposing the Medicaid extension.
SUSAN DENTZER: Well, they had two rationales.
One was that they were worried about this coercive effect. If I say I don’t want to do this, I have — I lose all my Medicaid money. That’s coercion. They also said it was coercive for the federal government to be paying so much of the cost. It was almost as if it was too good to be true; they couldn’t possibly turn it down. And that was coercive.
They lost on that argument. They have obviously won on the argument that if they do decide not to go forward with the expansion, they won’t lose all of their federal Medicaid dollars.
Now we have to ask ourselves what do we think is likely to happen. We will have to see how this plays out. But, as you say, 26 states felt strongly enough about this that they filed suit. And we will see what they decide to do as a policy matter.
JEFFREY BROWN: And if they don’t accept, are there implications outside of their own states, I mean, implications for the wider implementation of the act as a whole?
SUSAN DENTZER: No question about it, because half of the coverage expansion was to be carried out through Medicaid.
So if a large number of states elect not to do that, it means that many of these people — and there are millions of them — we’re talking about somewhere between 10 and 20 million people who are in this group of people who have not historically had access through — to health insurance to Medicaid, but would.
If they are disenfranchised, in fact, that means that, for example, lots of hospitals that were counting on the fact that people would be insured through Medicaid suddenly will have patients who are not insured that way. It really does diminish the potential to cover as many people as the Affordable Care Act was intended to do.
JEFFREY BROWN: All right, Susan Dentzer, thanks so much.
SUSAN DENTZER: Great to be with you, Jeff.