With the presidential election fast approaching, there’s no shortage of discussion on the future of the Affordable Care Act (ACA), more commonly known as Obamacare. Whatever your feelings on the ACA, a victory for Obama guarantees its continued implementation. For that reason, a majority of doctors plan on voting for Romney because they fear the negative impacts the ACA could have on their practice, and hope Romney will make good on his promise to “repeal Obamacare on day one.”
But even if Romney wins, it’s highly unlikely that the ACA will be repealed. Here’s why–and what you should do to prepare for the inevitable.
Lack of Congressional Support to Overturn Obamacare
The ACA is an Act of Congress, and repealing it would thus require majority support from both houses of Congress. Current projections are that Republicans will maintain control over the House of Representatives, while Democrats are expected to hold the Senate 50-48, along with two Independents who both favor the ACA. A Senate with this composition won’t vote to repeal the ACA in 2013.
But could the Republicans retake the Senate in the 2014 midterm elections if Romney wins? Probably not. In the last century, the sitting president’s party has lost seats in the Senate in 21 out of 26 midterm elections. In that scenario, Republicans would lose even more Senate seats and there would be no chance of a successful vote to repeal the ACA.
An Executive Order Can’t Repeal Obamacare
If Congress won’t repeal the ACA, can an elected Romney deliver on his promise to issue an “Executive Order that paves the way for the federal government to issue Obamacare waivers to all fifty states?” This, he claims, would swiftly exempt all 50 states from the ACA.
The short answer is no. The president doesn’t have the authority to undo an Act of Congress by Executive Order, and any attempts to do so would result in a futile legal battle.
However, the ACA does give the president the power to grant states waivers for certain portions of the Act–but this capability is much more limiting than the Romney campaign suggests. First, the waiver provision doesn’t go into effect until January 1, 2017 (close to the last day of the next presidential term). Second, it requires each state to apply to the Secretary of Health and Human Services, rather than have an Executive Order initiate the process. Finally, it requires a state to demonstrate that it provides the same amount of individual and financial coverage as the waiver provides. This provision offers states some flexibility to develop their own health plans, but doesn’t actually exempt them from anything.
In short, the section of the ACA that Romney was counting on is not a panacea for dissolving the Act.
ACA is Here to Stay: What You Should Do
Like it or not, the ACA is a done deal, regardless of who gets inaugurated in January 2013. The best thing you can do as a doctor is to prepare for its effects. Here are five areas to focus on.
1. Prepare for More Patients
At least three components of the ACA will lead to a rise in the number of patients visiting doctors’ offices: 1) the extension of coverage to 32 million more Americans; 2) requirements for insurance companies to cover more preventive care procedures; and, 3) prohibiting insurance companies from denying coverage for pre-existing conditions. All of this could mean more patients for your practice, so you should evaluate your ability to accommodate them. You might, for example, want to expand your staff or extend your office hours.
2. Make Decisions Regarding Medicare and Medicaid
Medicaid payments are rising to match Medicare rates–a sizable jump over the next few years. Unfortunately, that’s still only 81 percent of private insurance reimbursements, a rate that’s projected to drop due to $716 billion in cuts for Medicare and Medicare Advantage payments. In addition, changes in qualification criteria may result in many people moving from a private insurer to Medicaid, as happened when CHIP was established in 1997. As a result, many doctors are facing the difficult decision to stop accepting Medicare or Medicaid patients unless they can find ways to offset the costs.
3. Embrace or Reject Electronic Health Records (EHRs)
The ACA expands reporting requirements and reimbursements for the Physician Quality Reporting System (PQRS), creating penalties on Medicare reimbursements starting in 2015 for failure to adopt an EHR. This will encourage some of the 70 percent of doctors not yet using EHRs to purchase one, though others may drop government payers from their practice entirely. Those leaning toward the former may want to start looking at strategies for successful implementation.
4. Consider Going Rural
To improve access to care nationwide, the ACA creates a number of incentives to encourage physicians to practice in “underserved areas.” This primarily comes from the expansion of the National Health Service Corps, which provides loan repayments and scholarships to doctors practicing in rural areas. If you’re a young doctor considering a move, it might be worth exploring these incentives.
5. Evaluate Bundled Payments and ACOs
ACA creates Accountable Care Organizations (ACO)–groups of physicians who coordinate care for an individual patient or set of patients. By sharing information and taking joint accountability, an ACO can theoretically reduce the overall cost of care, with half the savings passed on to the providers as a bonus. Whether this will work remains to be seen–the results of the ACO pilot project suggest that for most providers this will result in more red tape that doesn’t improve care.
But whether you choose to participate in an ACO or not, government payers will be shifting from separately reimbursing physicians, labs and hospitals to “bundling payments.” This means you’ll have to collect payment for any treatments performed at a hospital from that hospital or a mutual association rather than from Medicare directly. This may require changes to your billing practices.
Of course, all of this is speculative. Large-scale initiatives like the ACA have a way of resulting in unintended consequences, and it’s impossible to forecast all the financial impacts it might have on medical practices. So, expect the unexpected–but do expect that the ACA will be there.
Blog thumbnail image created by DonkeyHotey.