Obama Care: US Healthcare Reforms and Its Impact - Essay Sample

Introduction

Obama care refers to the Patient Protection and Affordable Care Act of 2010 (ACA). The Act's goal is to make health affordable for every American citizen via reducing the costs for the less privileged and those who cannot afford the ever-rising cost of healthcare. The name Obama Care is coined from President Barack Obama, who championed healthcare reforms during his tenure from the year 2009 to 2017. The act has had tremendous benefits to US citizens as well as drawbacks, which will be analyzed in this review.

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Positives

Obama Care act has slowed the rise in healthcare costs. ACA does this by partly providing insurance for a majority of the citizens and making preventative care free. As such, individuals can receive treatment before they can seek or need the more expensive emergency room services. Between the years 2012 and 2017, the healthcare cost growth was at 1.3 percent per annum and thanks to the act, Centers for Medicare and Medicaid Services (CMS) asserts that the cost of healthcare is projected to grow by only 2.5 percent over the next decade (Amadeo, 2013).

ACA demands all the insurance plans to cover at least ten health essential benefits, including addiction, mental health, chronic diseases, among others. Without these services covered, a majority of the citizens would end up in more expensive emergency rooms escalating the cost tremendously and affecting their incomes negatively (HealthMarkets, 2018).

ACA eliminates the lifetime and annual coverage limits that required the insured to use up to $1 million annually, with beneficiaries who exceeded the limit paying 100% of their medical cost (Amadeo, 2013). This is a relief to many Americans suffering the chronic diseases since the costs are significantly reduced. Moreover, the act bars insurance companies from denying care to beneficiaries with pre-existing conditions, meaning the insurers cannot drop the patients, nor raise the premiums should they get sick. Lastly, the cover has extended the people who can be covered under the parent's cover up to 26 years, meaning more than 3 million individuals who were uninsured by the year 2012 were added (Amadeo, 2013). The advantage is it increased the insurers' profits since they would receive more premium from this healthy category.

Negatives

Approximately three to five million lost their job-based health insurance (Amadeo, 2013). This is because of a majority of the business found it easier to absorb the fines and allow the employees to buy insurance plan in exchange. The premium does not reduce for everybody, meaning that unqualified individuals find the available plans highly unaffordable, with beneficiaries being forced to pay for services they may not require (HealthMarkets, 2018).

ACA also introduced tax penalties to those who did not have insurance. Before 2019, individuals without insurance would be faced with substantial penalties, which is an additional burden (HealthMarkets, 2018). Before 2019, the number of insured individuals is estimated to have reduced by four million, which cost them millions of dollars (Amadeo, 2013). Moreover, the increased coverage translates to an increase in healthcare costs in the short-term. This can be attributed to the many people receiving preventive care and diagnosis for the first time, thus becoming more expensive to treat illnesses that had been assumed for a long time.

Lastly, approximately 30 million individuals did not have any company insurance and depended on private health insurance (Amadeo, 2013). Thus, the insurance companies canceled their subscriptions because their initial covers failed to cover the ten essential benefits. Some of the individuals were met by higher insurance premiums, while the act was demanding individuals to even pay for services they did not need, such as maternity care (HealthMarkets, 2018).

Conclusion

Due to the ever-rising cost of health and a surge in people suffering from lifetime chronic conditions, the government needs to develop policies aimed at subsidizing this overall cost. One of the ways was the introduction of the Affordable Care Act by President Obama. Similar to any other policy, ACA has is positives and negatives, both of which impacted the citizens' economics.

References

Amadeo, K. (2013, July 3). 10 Obamacare Pros and Cons. The Balance; The Balance. https://www.thebalance.com/obamacare-pros-and-cons-3306059

HealthMarkets. (2018, March 28). HealthMarkets. https://www.healthmarkets.com/resources/health-insurance/affordable-care-act-pros-and-cons/