One of the design flaws of the Affordable Care Act is that a number of the basic principles used in the insurance industry for risk management “have been sort of cast aside in the way the Affordable Care Act was structured,” said QualChoice Holdings Inc. President and CEO Michael Stock.
The insurance industry is in the business of managing risk. “And so when you take some sound business practices that are not only used in the health insurance industry, the property/casualty industry, … if you don’t follow those, it has a tendency to not work out well in the long run,” Stock said.
Under the ACA, everyone pays the same amount for the same health insurance plan, regardless of what the health status of a person is.
“And the impact is, the premiums are set too high for the healthiest people, and so the healthiest people aren’t getting into the program,” Stock said.
Arkansas Blue Cross & Blue Shield would like to see tighter rules on the enrollment periods put in place.
Max Greenwood, a spokeswoman for ABCBS, said some uninsured people who need expensive medical procedures or high-cost medical treatments enroll for health insurance, receive the treatment and then drop the coverage.
In addition, the ACA didn’t address controlling health care costs, said state Rep. Charlie Collins, R-Fayetteville, who co-chairs the Arkansas Legislative Health Care Task Force.
The emergency room is the most expensive place to receive care. Yet it’s free for people without insurance because of the Emergency Medical Treatment & Labor Act, which was passed in 1986. It requires access to emergency services regardless of whether the patients can pay.
He said the act makes it illegal for the states to change that law to require people to pay to use the emergency room.
“What we’ve essentially said is people without income or with low income or who just choose not to pay for insurance can go to the emergency room all day long, for any reason, at no cost” to them, Collins said.
Instead, that emergency room cost “gets pushed onto everybody else.”
Collins said that’s one of the reasons premiums on the exchanges are rising so quickly across the country.
“If the hospitals cannot charge people who are coming in for free anymore, they have to shift that cost to the people that are paying,” he said.
(Also see Arkansas Sidesteps Some Obamacare Problems with Unique Mix.)
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