I count myself among the many who were dismayed, disheartened and dumbfounded when the Supreme Court issued its opinion upholding the constitutionality of the act. I will not join the commentariat in condemning the Supreme court in general or Chief Justice Roberts for the opinion. I take at face value the idea that Chief Justice Roberts ruled in the fashion that he thought correct. He seeming to have relied on the Brandeis Rule for statutory construction in place since 1936 which provided that :
"The Court will not pass upon a constitutional question, although properly
presented by the record, if there is also present some other ground upon which the case may
be disposed of. [...] Thus, if a case can be decided upon two grounds, one involving a
constitutional question, the other a question of statutory construction or general law, the
On the Affordable Care Act (ACA) my issue is not with the Court but with the manner in which Congress passed the Act and the manner in which the President marketed and sold it. While insisting to the voting public that the mandate and the rest of the act were not taxes, he sent his Solicitor General out to argue that it was in fact a tax so as to save it from constitutional scrutiny. The whole spectacle was some charade of Three-Card-Monty marketed using almost Orwellian Language. I think that I need to read Animal Farm again. [Rant concluded]
With the constitutional viability of the act safely ensured, I suppose that it is time for everyone to take Representative Pelosi's advice and now read it to find out what is in it. Some of that work has already been done and, as it applies to the Insurance Industry, Dr. Robert Hartwig of the Insurance Information Institute sat through an interview with World Risk and Insurance News to discuss the impact of the Affordable Care Act. That interview can be seen at http://www.wrin.tv/index.php/component/content/article/3/392#.T_LU2o4JJ5E.bitly.
As the ACA relates to the WC industry, the effects are not likely to be direct, if felt at all. Dr. Hartwig suggests that the primary impact on Employers and Workers' Compensation Insurers will be to diminish cost shifting behavior. For example, an employee without health insurance is less likely to be in good health and that, as a result, any occupational injuries are exacerbated by the poor condition that the employee was in prior to the injury. If one accepts that the ACA will actually lead to higher instances of coverage, this tangential benefit MAY lead to less problems with medical co-morbidities that lead to higher medical costs and longer periods of disability. For employers that actually provide health insurance for their employees, what little benefit may have been there under the most charitable treatment of Dr. Hartwig's comments most certainly evaporates. If one removes the rose-colored glasses, however, and views the Mandate through the lens of human experience the ACA neither removes the free-rider problem (the whole reason for the law in the first place right?) nor solves the cost shifting that Dr. Hartwig mentions. While Congress can pass a law, it cannot repeal the law of unintended consequences. The ACA's provisions for guaranteed issue with no ability to decline coverage based on a pre-existing condition has sewn the seeds of its own demise. If an individual can pay a fine (er... a tax as it was termed to survive constitutional scrutiny) and that fine is LESS than the cost of the premium, simple observance of human nature shows that the least expensive path will be chosen. At some point in the future, with the pre-existing condition in full flower, that same individual can now go get his insurance policy and VIOLA!, coverage is in place until it is no longer needed. In this example (and I would love to be proven wrong about the gaming of the system that looms large on the horizon) there is no diminishment of cost shifting just a reallocation of that to a wider premium base known as the taxpaying public. [While we're on that point, how many people that actually pay taxes, file a return are without insurance? Is the population such that this massive legislation was the only way through the problem?] Further, with the prohibition against taking a persion's condition into account when setting the premium for a policy, the so-called "community rating" provisions, the cost of that guaranteed issue policy is now to be shared by those of us who had coverage all along. Thanks for that Ms. Pelosi.
Another possible benefit mentioned by Dr. Hartwig relates to wellness programs encouraged under some health insurance programs. Perhaps there is some truth to this but I would submit that this relates more to larger Fortune 100 companies with Health Insurance Programs already in place, with a healthier work force. If that's the population involved, cost shifting from non-occupational conditions to the occupational injury realm is probably as rare as unicorns.
Finally, Dr. Hartwig also mentions as another possible benefit to the Worker's Compensation Insurance Industry the idea that supposedly injured workers will have less incentive to commit fraud by attempting to secure coverage for their non-occupational medical conditions as work related injuries. If the only benefit to an individual submitting a fraudulent claim is the coverage of medical conditions, I might have some sympathy with this argument. However, is it realistic to believe that someone who lies to get a medical condition covered is going to suddenly discover their scruples when it comes to the income benefits that accompany a WC claim? After all, if the individual had no money to purchase medical insurance in the first place, is it any more likely that this same person had savings, spare cash or money enough to cover disability insurance premiums? Sorry, but someone who is willing to commit fraud in the first instance is more than likely willing to see it through if there's an indemnity check for them during their convalesence. Yes, desperate people do desperate things but the idea that providing them with coverage for their medical conditions that they did not have before is going to change the incentives seems little more than wishful thinking.
"Skedsvold & White
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