The exchanges, similar to what Republicans have proposed for Medicare recipients, will be available to small businesses and uninsured individuals starting in 2014. The idea, the same as a Medicare plan proposed by conservative Rep. Paul Ryan, R-Wis., is that the marketplace will foster competition and drive down costs. But of course, that can’t happen until the exchanges are up and running.
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Another cost-cutting approach is scheduled to begin in 2015 when a new Independent Payment Advisory Board can start recommending ways to curb the growth of Medicare costs. As of this year, the government is tracking readmission rates at hospitals and charging penalties to hospitals with the highest rates.
Next year, Medicare will test plans to pay a single “bundled” fee for an operation, instead of separate charges for every doctor, test, and medication. The law sets up many other pilot programs aimed at cutting costs, including home-based care for the chronically ill, transitional care for people leaving hospitals, penalizing hospitals with high infection rates, and offering hospice services along with aggressive treatment (giving patients both could reduce costs and at the same time prolong life, research shows).
The bottom line is, it’s way too soon to say whether any of these experiments will fail, or succeed and spread and change the health sector on a large scale.
As for “Romneycare,” the Santorum campaign is basing its claim of failure on a 2008 study by the libertarian Cato Institute. Massachusetts leads the nation in coverage – more than 98 percent of its residents have insurance. A survey of the state in June found 63 percent approved of the law, while only 21 percent opposed it. The initial law did not deal with rising costs, but the state is tackling them now with experiments that look a lot like what’s in the Affordable Care Act.
If the authors of the 906-page Affordable Care Act had left out the cost-cutting components, it would have been a much shorter and less complicated law. But that would have made it an even easier target for the GOP than the current law, with its years of phase-ins during which critics are free to carp before anyone knows if they are right or not.
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