Health Law Debate Leaves Unanswered Questions
Though host Bill Goodman said they just "scratched the surface" on what the federal health-care reform law will mean for Kentucky, physicians and legislators debated Medicaid expansion, the implications of requiring people to buy health insurance, how to pay for it all and other questions last night on KET's "Kentucky Tonight" panel and call-in show.
Perhaps the biggest question about the law in Kentucky is whether the state will choose to expand Medicaid, allowing as many as 329,000 more people with incomes up to 138 percent of the federal poverty threshold to qualify for the program for the poor and disabled and be paid for entirely by the federal government in 2014-16. State Rep. Mary Lou Marzian, D-Louisville, pushed hard for the expansion, saying "We can't leave 100 percent of the money laying on the table."
Starting in 2017, the amount of federal contribution will start to decrease — to 95 percent in 2017, 94 percent in 2018, 93 percent in 2019 and 90 percent in 2020 and subsequent years, according to the Henry J. Kaiser Foundation.
Kentucky already has a $400 million shortfall in its budget, said Republican state Sen. Tom Buford of Nicholasville, and would need "$515 to $695 million by 2020" to pay for the additional recipients. Other Republicans have said that would require higher taxes or cuts in services, and called for Gov. Steve Beshear to reject the expansion, but supporters of the law argue that the state will save money overall. For that story, click here.
Louisville urologist Michael Macfarlane, a member of the state Republican executive committee, said he would like to see everyone get health care, but "It really boils down to how are we are going pay for this. . . . In every program like this they underestimate what the future entails. . . . The money is not out there. . . . We are going to be Greece and Spain before long."
Marzian replied, "We are paying now for our uninsured folks that we can put onto Medicaid." Noting that the state has spent hundreds of millions of dollars to help the Kentucky Speedway and the Kentucky Horse Park and build the Yum! Center in Louisville, she asked, "Why can’t we help our middle class and the poorest of the poor get health insurance and health care?" She said the law will stimulate the economy because having more people insured will generate more need for health-care services and health-care jobs.
The panel also debated the implications of the law's requirement to buy health insurance or pay a penalty, which the U.S. Supreme Court upheld as a legitimate use of the taxing power of Congress. Marzian said requiring people to buy health insurance is "personal responsibility" since "everybody uses health care at some point."
Buford, an insurance agent and the chairman of the Senate Banking and Insurance Committee, contended that instead of buying health insurance, those not eligible for Medicaid could just choose to pay the penalty ($695 for individuals or up to 2.5 percent of the household income, the Kaiser Foundation notes) and when hospital care is needed, "She can buy insurance on her way in the ambulance," and after being treated, can cancel the policy.
"That is simply not true," Marzian said. "There is a waiting period." Well, not exactly.
Nicole Huberfeld, a University of Kentucky law professor whom Supreme Court Justice Ruth Bader Ginsburg cited in her opinion, told Kentucky Health News, "The law allows for one three-month grace period of non-coverage per year, so if a person were uncovered, then covered, then uncovered, then covered, penalties would be assessed for the second two non-covered periods." She called that scenario "economically inefficient" since "Most people do not choose to pay something, the tax penalty, for nothing: opting not to have insurance coverage."
In his blog for MoneyTalks News, Stacy Johnson argued that buying health coverage only when it's needed might also backfire: "If you go to the emergency room for a broken leg, will you sit there in agony, applying for insurance and waiting as long as it takes for newly purchased insurance to kick in?"
The liveliest debate on the hour-long show was between the two doctors, Macfarlane and Morehead internist Ewell Scott.
Macfarlane said, "This system really has nothing to do with helping people get health insurance, this system is really going to take over health care . . . directly by computer programs and protocols out of Washington," which he said will ration care and socialize the system. He said a new coding system that will require physicians to select from a vast number of codes — up to 68,000 in the new system from 13,000 in the old one, the American Medical Association indicates— to describe in detail the diagnosis and treatment of each case.
Scott replied, "I think Dr. Macfarlane, with all due respect, is crazy. . . . This is not going to happen." Asked is and how Macfarlane was misstating the facts, Scott said, "This is not going to be a problem for the physician." Macfarlane replied, "That's just not true."
The system in question is the International Classification of Diseases. The ninth version of the system has been in place for 30 years. The transition to ICD-10 will be effective Oct. 1, 2013, according to the Cabinet for Health and Family Services. Despite the increased number of codes, it is not expected to be more time-consuming for providers because "each diagnosis or procedure gets only one code," said Don McLeod, spokesman for the federal Centers for Medicare & Medicaid Services.
Scott acknowledged the law is not perfect and "does nothing to control costs in the long run," but called it "a baby step forward for getting us out of this terrible, dysfunctional health-care financing system we've gotten ourselves into." Scott noted the U.S. has the most expensive health-care system in the world "by double" but has "the worst outcomes in the world." A study by The Commonwealth Fund ranked the U.S. sixth of the seven main industrialized countries in terms of quality.
Macfarlane maintained, "We have the best system in the world." He acknowledged changes are needed, but "The idea that the mandate will pay for this is just false." Large swaths of the population, including young adults, undocumented immigrants and people who are out of work, will continue to avoid buying health insurance, he said. (In fact, undocumented immigrants are exempt from paying the penalty, according to the Kaiser Foundation.)
Goodman ended the show by acknowledging the subject's complexity and the need for more discussion on another episode later this summer or in early fall. To view the show, click here.
Kentucky Health News is a service of the Institute for Rural Journalism and Community Issues, based in the School of Journalism and Telecommunications at the University of Kentucky, with support from the Foundation for a Healthy Kentucky.