Let's call the Patient Protection and Affordable Care Act what it is: a government mandate long on using punishment as its favored means of implementation, yet short on cost control and lacking in quality of care guarantees.
Competitive pricing by pharmaceutical companies, for example, one of the very levers that the industry uses today to keep costs in check, is not allowed under the new law.
The new law erodes any serious attempt at using the free market to control costs, and any savings from spreading the risk by including another 30 million uninsured American's will dry up. Soon enough, we'll be asking why we passed such a law.
From the standpoint of employers, the law is less inclusive than it is punitive. For the first time, employers, who previously enjoyed ERISA-based protections, will be subject to civil suits for non-compliance.
A whistleblower provision, which encourages employees to report employers suspected of wrong-doing, punctuates the law's punitive spirit.
The new law is well intended. It aims to corral 30 million uninsured Americans. As more lives are insured, costs are theoretically spread over a broader base.
By mandating universal coverage, the law offers a minimum floor for all Americans, which is good news. For businesses, though, the reforms don't do a whole lot. In response, some business leaders are thinking of getting out of offering health care entirely, and paying the penalty instead.
Surveys find that employers, and now employees, are resigned to paying more for health care, namely in the form of fines if not higher premiums. This summer, another survey found that as many as one quarter of all Americans expect to pay more. If only we could have guarantees that costs would plateau, that the quality of care would rise, and that doctors would stop practicing defensive medicine.
Yet the new law can't guarantee any of that, even as it shifts the focus from errors to outcomes.
In the end employers are left with higher costs in the form of fines, but no guarantee of improved outcomes or more efficient delivery. In short, under the new health care system, employers don't expect to get what they'll be asked to pay for.
CYRIL TUOHY is managing editor of Risk & Insurance®. He can be reached at firstname.lastname@example.org.
October 1, 2012
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