Introduction
Increased health costs in the recent past have forced US government to come up with health care reforms that will help to reduce its expenditures on health care provision. These reforms are contained in the health care reform bill that was enacted in 2010 by President Barack Obama in the Patient Protection and Affordable Care Act (Cohn, 2010). Health care reforms have numerous pros and cons to both the government and the citizens. The democrats support these reforms while the republicans oppose on different grounds. This paper discusses the benefits and costs that come with these health care reforms while also concluding the main reasons why democrats and republicans support and oppose the reforms respectively.
Benefits
According to democrats, the Act has a number of benefits to the Americans which can be divided into short term and long term benefits. Democrats believe that the enactment of this legislation will make health insurance more available to the Americans. This would be made possible in the following ways;
a) Helping early retirees
Health care reforms create a re-insurance program that is temporary until the time when exchanges will be available. This is aimed to reduce the increased claims that health care costs are expensive for those employers who provide benefits to the retirees who are aged between fifty-five and sixty four years. This policy is enforced only three months after the date of enactment of health care reform bill (Harrington, 2010).
b) Tax credits for small businesses
Health care reforms will offer some tax benefits to the small businesses to enable them to cover their employees more comfortably. Reforms would provide small companies tax credit amounting to 35 percent of the total premium hence making their employees’ coverage more affordable. This percentage may be increased up to 50 percent by the year 2014 thus making insurance coverage of all employees more affordable. These tax credits are made available immediately after the enactment of the new law.
c) Stabilizing Medicare financially
The reforms will allow the beneficiaries of Medicare to be provided with $250 especially those who were stacked in 2010 in the ‘donut hole’. Reforms would also help close the donut hole by 2020 and from this year a discount of 50 percent will be given on all brand-name drugs.
d) No children discrimination
Those children with conditions that are pre-existing will not be denied coverage by various health plans as it has been done there before. The reforms would apply six months after enactment date and would apply to everyone by 2014.
e) Free care for prevention
Under the Medicare, the new reforms will ensure that there are no co-payments for all preventive services. It also removes all deductibles in preventive services provided through Medicare.
Health care reforms will also provide a number of long term benefits to both the citizens as well as to the government as discussed below.
a) Premium controls
Health care bill allows premiums to be closely monitored where insurance companies will increase their premiums the way they want. If they want to increase their premiums, the new law requires them to first announce it to the public. Again insurance companies are not allowed to add the expenses for administration to their policy. The new law requires them not to exceed more than 25 percent of the expenses that are non-medical. If any insurance company is discovered to have gone above this percent, it will be forced to refund the extra amount to its policyholders.
b) Allow premiums to be based on age limit instead of health
The new laws will require insurance companies not to underwrite their policy on the basis of health status of the holder. In addition, they are required to include pre-existing conditions in their coverage. This help to remove unreasonable limits that were put there before such as lifetime limits. Age bracket will be the basis for allocating premiums and not the age of the person intending to take the insurance cover. Furthermore, insurance companies will not be allowed to cancel the policy if the policyholders get sick as they used to do there before. Several instance insurance companies made honest mistakes to cancel their coverage but with the new laws this will not be allowed.
c) More choices
With the new laws, policyholders will be allowed to have more than one plan rather than just to keep one insurance plan as they are used to. They can now look for several alternatives that are more comprehensive that will fit their needs better. This could not be possible with the old heath insurance laws.
d) Reduce government costs
Recently, the government expenditures on health care have increased drastically calling government and other policy makers in the health sectors to look for an urgent solution (Singleton, 2011). One of the proposals given in the health care reforms is to cut the benefits that are given to different groups such as the elderly in order to reduce the burden of the government on health care provision. Though this strategy has numerous negative consequences especially to the poor and the elderly in the society who may not afford health care services, government on the other hand will benefit in that it will be in a position to reduce its spending on the health care provision thus attaining its goal of economic growth and stability. The government may also decide to increase tax for middle class employees in order to cater for the increased number of beneficiaries who are attaining the age of retirement. This will also help to reduce the burden of government in providing health care services.
Cons of health care reforms
The republicans are in the forefront to oppose this Act on the basis that it is doing more harm than good to the Americans. Some of the reasons they are giving to oppose this Act include the following;
a) Compromise of health care services
The government proposal to reduce its spending on the elderly will affect their health negatively. Due to the increased drug prices, the elderly and the poor are already feeling the pain of buying drugs through out-of- pocket expenses and the government move will make it more difficult for them to afford their basic health care services (Gulley, Rasch, & Chan, 2011). Many elderly and poor people will be forced to skip some of their prescribed dose since they are not financially capable to cater for them. This will affect them negatively requiring them to seek further hospitalizations that are more expensive. Some people may also be forced to buy drugs at the expense of other basic needs such as food and heating expenses which as a result will make their health status worse.
b) Increased taxation
The new health care reforms are expected to be opposed by various groups that are affected negatively by these reforms. For example, middle class employees are not ready to be taxed more in order to cater for health care of other groups. They are already feeling the pressure for increased health care services and even some of them struggling to cater for their own health care expenses. Thus any government move to increase their tax will be highly opposed. Again the elderly are also not ready to receive lower benefits for the health care services and although the government will the power to so, it is likely to lose the support of the retirees in the coming general elections. This opposition may be reduced if the government looks for other ways that are more acceptable to the citizens.
c) Increased burden on the employers
The new reforms will require employers to pay more premiums for their employees that in turn will increase the expenses of their companies (Cole, & McCullough, 2006). These will make all the companies operating in the US to lack competitive advantage in the international market due to high prices of their products.
Conclusion
Democrats support the enactment of this new law on the basis that it will make health care to be more affordable to all the Americans. The benefits of these reforms include reduced burden on the side of the government and better insurance coverage on the side of the citizens. Small businesses will also be given tax credits in order to make insurance coverage for their employees more affordable. On the other hand, the republicans oppose this legislation because it will lead to compromised health care among the poor and the elderly, increased taxation and finally low competitive advantage for US businesses in the international market due high prices of their products.
References
Cohn, J. (2010). How They Did It. New Republic, 24(9), 14-25.
Cole, C. & McCullough, K. (2006). A Review of the Issues Surrounding Fair Share Health Care Bills. Journal of Insurance Regulation, 25(1), 25-40.
Gulley, S., Rasch, E., & Chan, L. (2011). Ongoing Coverage for Ongoing Care: Access, Utilization, and Out-of-Pocket Spending Among Uninsured Working-Aged Adults with Chronic Health Care Needs. American Journal of Public Health, 101(2), 368-375.
Harrington, S. (2010). The Health Insurance Reform Debate. Journal of Risk & Insurance, 77(1), 5-38.
Singleton, J. (2011). The Good, The Bad, and The Ugly: How the Due Process Clause May Limit Comprehensive Health Care Reform. Issues in Law & Medicine, 26(3), 217-236.
