The Road to Health Reform: What Can Physicians Expect Over the Next 4 Years? FREE

It is often said that it is the journey, not the destination, that matters most. When it comes to health care reform, it is both. The destination, as framed by the Patient Protection and Affordable Care Act (ACA), is affordable health insurance coverage and improved access to care. The journey will require setting up marketplaces (exchanges), selling qualified insurance, expanding Medicaid, and transforming payment and delivery systems. Before President Obama's reelection, one could have envisioned the journey being halted, but over the next 4 years, the health care system will have to travel a road to reform over political and practical obstacles, all of which will directly affect physicians and their patients.

For U.S. residents, the ACA's effectiveness in extending coverage will depend mostly on where they live and which political party controls their statehouse. Some states are well on their way to joining Massachusetts in providing coverage to nearly all residents, but others may take years to do so.

The ACA was originally projected to expand coverage to 95% of the U.S. population and to 32 million uninsured persons (half through Medicaid and half through health insurance plans offered by exchanges), with federal subsidies and limits on out-of-pocket expenses to make the plans affordable (1). The Supreme Court's decision to make the ACA's Medicaid expansion voluntary, combined with continuing opposition from many Republican-controlled states, means that the coverage expansions will be slower and less uniform.

As of 6 February 2013, only 6 states with Republican governors have committed to accepting federal funding to expand Medicaid in 2014 to all residents with incomes up to 133% of the federal poverty level. Eleven Republican-led states have declined, and 5 others may follow suit. Nationwide, only 21 states and the District of Columbia have committed to expanding Medicaid, and the rest remain undecided (2). In states that decide not to expand Medicaid, residents with incomes at or below the federal poverty level will have no access to the ACA's subsidized coverage. By 2022, the law is likely to cover 3 million fewer persons than originally estimated (3).

Similarly, many states have declined to set up state-administered exchanges to provide residents with access to qualified health plans. The ACA requires the federal government to run the exchanges in states that opt out; however, some experts question the federal government's ability to effectively do this in dozens of states with tens of millions of residents (4).

Initial confusion is likely as people navigate coverage through the ACA's programs. Here too, states play an important role: A strong public outreach effort will be needed to help people sign up (5 - 6). But how likely is it, in states where opposition to the law runs strong, that officials will lift a finger to facilitate coverage?

The journey to universal coverage will face unrelenting pressure to reduce federal health care spending. The “fiscal cliff” legislation passed by Congress on 1 January 2013 merely postponed until 1 March 2013 more than $100 billion in scheduled across-the-board cuts to “discretionary” defense and domestic programs. Then, at the end of March, a temporary legislative measure to fund the federal government will expire, raising the possibility of a government shutdown if agreement cannot be reached on a bill to continue funding. By mid-May, the federal government will have breached its debt limit. At the end of the year, Congress will again need to address a scheduled double-digit cut in Medicare physician payments.

Congressional Republicans have vowed to use these self-imposed deadlines to force Senate Democrats and President Obama to accept deeper federal spending cuts in nondefense programs and to begin reform of Medicare, Medicaid, and other entitlements. President Obama has stated that any spending cuts must be accompanied by more revenue. Absent a “grand bargain” on taxes, spending, and entitlement reform, continued spending showdowns between the House of Representatives and the President may be a challenge during President Obama's second term. Accordingly, health programs, including the National Institutes of Health, the Centers for Disease Control and Prevention, and graduate medical education residency programs, will be at risk for deep funding cuts, and some physicians (especially in more procedurally oriented specialties) may see reduced Medicare payments.

Even without new federal budget cuts, many physicians could soon see their Medicare payments reduced. For the past several years, Medicare has used the positive incentive of higher payments to get physicians to participate in quality reporting programs. Starting in 2015, physicians will be subject to payment cuts if they do not comply (7). One study estimates that 80% of physicians could be subject to penalties (8).

Primary care physicians, though, stand to benefit from an ACA program that increases Medicaid payment for visits and vaccinations to no less than Medicare's rates. On average, this will increase their Medicaid payments by 73% this year and next (9). The program will expire at the end of 2014 unless Congress or state Medicaid programs decide on extensions. Primary care physicians will also continue to benefit from the ACA's 10% Medicare bonus program through 2015.

Finally, there will be a sustained push to get physicians and hospitals to transition to more efficient care delivery models, such as accountable care organizations, patient-centered medical homes, and bundled payments for care episodes. Physicians, especially in smaller practices, will find participation in such models to be challenging, yet it may offer them the best opportunity to sustain or even increase their Medicare payments.

Despite the challenges, the journey to a health care system that covers nearly everyone while lowering per capita spending is one that is well worth taking. The Institute of Medicine recently found that although the United States spends more on health care than any other country, its outcomes are worse on most measures of health (10). This is the health care that we have and are trying to move away from.

Physicians can help the United States chart a path to a better health care system by urging their states to expand coverage and urging Congress to enact responsible ways to reduce health care spending that preserve funding for programs essential to public health. Physicians can lead efforts to develop new ways to deliver patient-centered care. Most important, physicians can bring to the policy discussion their unique perspectives on what it is like to try to deliver compassionate, ethical, and high-quality care to patients in a system that too often stands in the way.