Patient Protection and Affordable Care Act (ACA) is a U.S. federal law signed by President Obama on March 23, 2010. The unofficial name of the act is Obamacare. It is a legal framework for healthcare reform, which has become one of the largest projects in US history since the mid-1960s.
The reform is an initiative of former US President Barack Obama and is considered the main achievement of his presidency.
This is the first attempt to reform the US medical system since the 1960s when President Johnson created the state Medicare and Medicaid programs to help retirees and the poor.
Back in 1993, the Bill Clinton administration tried to carry out the current reform, albeit unsuccessfully.
On January 13, 2017, 6 days before the inauguration of Republican Donald Trump, the U.S. House of Representatives voted in favor of a resolution that would initiate the process of canceling Obamacare.
Background
Over the past 30 years, America has disproportionately increased health care spending, although there were no objective reasons for improving the quality of services. Over the past decade, the cost of insurance per employee has soared more than doubled. A significant part of the population remains uninsured, and the proportion of such people is growing. The insurance market provided by employers is extremely monopolized, which impedes labor mobility and creates conditions for discrimination of patients both before and after the conclusion of an insurance contract, including in the form of denial of payments. The ever-increasing cost of Medicare and Medicaid is one reason for the acute US budget deficit.
The current medical system is characterized by unresolved interaction between the public and private sectors of the economy. Despite the fact that the state allocates huge sums to the industry, it does not have effective levers of control over the prices and costs of services and drugs.
As a result, medicine is in fact very expensive and many poor citizens cannot pay for it, and often the state also does not protect them in any way. The United States is one of the few developed countries that do not have a universal health insurance system.
Content of the Reform
On March 21, 2010, the US Congress approved health care reform; part of its provisions was considered in 2012 by the Supreme Court to be contrary to the constitution. In 2015, before the Supreme Court considered a case on the legality of applying tax credits to people who purchase insurance on federal exchanges (and not just on established states) – this practice was recognized as legal.
The main element of the reform is the introduction of the obligation of US citizens to purchase health insurance if they are not insured. At the same time, subsidies are provided for the poor.
The reform is also intended to improve the conditions of medical insurance for citizens who already have a policy. So, according to the bill, from January 1, 2014, employers and their insurers will no longer be able to refuse to provide health insurance or increase insurance premiums if, before the start of the employment contract, the employee has already confirmed a serious chronic illness (for example, AIDS, cancer, etc.).
Exchanges for policyholders will be created, thanks to which it will be possible to obtain a policy for those who could not get insurance from the employer. For insurance premiums, in this case, a “ceiling” will be set at 3-9.5% of the client’s income. Citizens will be able to purchase insurance without the assistance of employers in specially created centers for this. There will be an administrative liability in relation to persons who refuse to acquire and companies that refuse to sell the policy. Starting in 2014, such fines for citizens will amount to $95 or 1% of income and will gradually increase to $695 or 2% of income. The supply system for senior citizens with necessary medicines will be improved.
As a result, insurance coverage should cover 95% of the country’s population (versus 84% according to 2011 data).
It is also expected that the reform will create new 400 thousand jobs. It will be possible to reduce the cost of an individual patient and invest more in medicine.
New taxes will also appear for wealthy citizens and pharmaceutical companies – in the amount of $409.2 billion by 2019. Thanks to the reform, it is planned to reduce the budget deficit by $138 billion over the next 10 years and another $1.2 trillion in the next decade. According to the authors of the bill, the effectiveness of the system as a whole will increase. It цшдд be possible to release $286 billion only as a result of a reduction in administrative expenses in insurance companies.
The program is designed for 10 years and will cost the US budget 940 billion dollars. According to the Congressional Budget Office in 2012, if the reform were canceled, the budget deficit would have grown by $ 109 billion over 10 years. The “extended” nature of the reform will allow patients, market participants and the economy as a whole to adapt to it.
Criticism
Opposition to the law and attempts to repeal it are based on the support of such forces as trade unions, propaganda centers of American conservatives, republicans, associations of small business representatives and the Tea Party. These groups are of the opinion that the law will frustrate plans to develop the existing healthcare system, that new insurance standards will increase public spending and increase the budget deficit. Some object to the very idea of universal health, viewing health insurance as a product that, like others, should not be subsidized.
On May 12, 2016, Republicans achieved an important judicial victory: a federal court ruled that the Obama administration used the wrong methods to finance subsidies to the poor as part of the reform
Consequences
Due to the fact that reform means increased government regulation, relies on a powerful federal government apparatus and requires large budgetary expenditures, the reform itself as a whole, as well as its individual provisions and / or stages in particular, have been repeatedly sabotaged by representatives of the Republican Party that controls the US House of Representatives. These contradictions ultimately led to the fact that the budget for the fiscal year 2014 was not agreed on time, and, consequently, to the suspension of the US government and state organizations from October 1, 2013.
From October 2013 to June 2014, according to various estimates, the number of adult Americans with health insurance increased by 8-10 million.
Cancellation steps
On January 14, 2017, 6 days before the inauguration of Donald Trump, the US House of Representatives voted in favor of a resolution that would initiate the process of canceling Obamacare.
On January 20, 2017, the incumbent President of the United States, Donald Trump, in his early hours at the White House signed an executive decree that eases the regulatory requirements for government agencies introduced by the Affordable Health Insurance Act, based on which the Obamacare program works.
At the end of June, the US president called on Republican senators to cancel the current health insurance system adopted by Barack Obama. All 48 Democrats in the Senate stand against this.
On July 28, the US Senate rejected a “truncated” plan to partially replace Obamacare’s health care reform. Decisive vote belonged to Republican Senator John McCain.
In October 2017, the Trump administration announced that it would cease a number of payments to insurance companies, believing that they did not have the necessary approval from Congress.
On December 15, 2018, a federal court in the Texas city of Fort Worth declared unconstitutional health care and patient protection reform in the United States. Judge Reed O’Connor, who made this decision, explained this by abolition in 2017 of one of the main provisions of Obamacare – a mandate that obliges all U.S. citizens to buy health insurance. Supporters of Obamacare intend to appeal the verdict to the Supreme Court.