The ACA’s Choice Problem

The Affordable Care Act (ACA) is in many ways a success. Millions more Americans now have access to health care, and the ACA catalyzed advances in health care delivery reform. Simultaneously, it has reinforced and bolstered a problem at the heart of American health policy and regulation: a love affair with choice. The ACA’s insurance reforms doubled down on the particularly American obsession with choice. This article describes three ways in which that doubling down is problematic for the future of US health policy. First, pragmatically, health policy theory predicts that choice among health plans will produce tangible benefits that it does not actually produce. Most people do not like choosing among health plan options, and many people—even if well-educated and knowledgeable—do not make good choices. Second, creating the regulatory structures to support these choices built and reinforced a massive market bureaucracy. Finally, and most important, philosophically and sociologically the ACA reinforces the idea that the goal of health regulation should be to preserve choice, even when that choice is empty. This vicious cycle seems likely to persist, based on the Democratic debates leading up to the 2020 presidential election

The Irony of Health Care’s Public Option

The idea of a public health insurance option is at least a half century old, but has not yet had its day in the limelight. This chapter explains why if that moment ever comes, health care’s public option will fall short of expectations that it will provide a differentiated, meaningful alternative to private health insurance and will spur health insurance competition. Health care’s public option bubbled up in its best-known form in California in the early 2000s and got increasing mainstream attention in the lead up to the 2010 health reform, the Patient Protection and Affordable Care Act (ACA). The idea has reemerged with vigor once again as a core tenet of Democratic presidential nominee Joe Biden’s plans to build on the ACA. When people talk about health care’s public option, they mean a public health insurance plan, typically based on Medicare that someone could select in the individual, or nongroup, health insurance market instead of a private health insurance offering. Proponents have argued that a public health insurance option could deliver better cost-control than private insurance, while also being able to offer a broad choice of providers and quality control. Health care’s public option died in the 2010 ACA legislative process, but had it been enacted, it would have faced serious obstacles to produce these results its architects hoped. The assumption that people will select the public option if it is better than other options is belied by a mounting body of empirical literature showing how we struggle, and do not do all that well, when choosing among health insurance options. Even more, political thorniness would almost certainly have prevented the public option from being a clear best alternative, which would have further impeded its ability to stand out in a crowd of options. If consumers fail to gravitate overwhelmingly to a public option, it cannot catalyze the market pressure necessary to produce lower prices or higher quality. For a public health insurance option to have transformative potential—to promote greater health equity and freedom—it needs to be more than an option among many, what Sitaraman and Alstott call a competitive public option. It must be designed in a way that does not rely on people weighing it against other options and selecting it when it is the best. This chapter examines possibilities for health care’s public option in three parts. It first explains the theory behind health care’s competitive public option, the form envisioned in the ACA and similar to early proposals by the Biden Campaign during the Democratic primaries. It then considers the challenges this competitive public option would have faced had it become policy reality. Finally, it examines more effective ways that public health insurance might be integrated into a public/private hybrid system to achieve greater health equity

Discrimination Risks of Alzheimer’s as Support for Social Insurance for Long-Term Care

This short reflection on an article by J. J. Arias, A. M. Tyler, B. J. Oster, and J. Karlawish (“The Proactive Patient: Long-term Care Insurance Discrimination Risk of Alzheimer’s Disease Biomarkers,” Journal of Law, Medicine & Ethics 46, no. 2 (2018): 485-498) makes clear why the private market for long-term care insurance, and its regulation, will perpetually fail to protect families against the risks to their security posed by a family member with Alzheimer’s. It describes why a comprehensive federal solution is the only feasible and wise option

How a Pandemic Plus Recession Foretell the Post-Job Based Horizon of Health Insurance

For many years, the health insurance that people received through their jobs was considered the gold standard, so much so that it came to be called “Cadillac coverage.” Just as Cadillac has lost its sheen, so has job-based health insurance coverage in many cases. This decline predated the COVID-19 pandemic, yet it has been, and will continue to be, hastened by it. The changes to job-based coverage have prompted people to ask: what’s next? This Article suggests that the lessons from the pandemic could offer an opportunity fundamentally to rethink the way to pay for healthcare in the United States, perhaps opening a window for reform. Meaningful reform should imagine a better overall financing system ten to twenty years from now, rather than just trying to plug the most egregious holes in the existing system. This long view might produce counterintuitive results, likely focusing on reforms that will, in part or in whole, reach people who already have health insurance, rather than taking a laser focus to address the needs of the uninsured. But doing so could eventually produce a simpler and more equitable structure

How a Pandemic Plus Recession Foretell the Post-Job Based Horizon of Health Insurance

For many years, the health insurance that people received through their jobs was considered the gold standard, so much so that it came to be called “Cadillac coverage.” Just as Cadillac has lost its sheen, so has job-based health insurance coverage in many cases. This decline predated the COVID-19 pandemic, yet it has been, and will continue to be, hastened by it. The changes to job-based coverage have prompted people to ask: what’s next? This Article suggests that the lessons from the pandemic could offer an opportunity fundamentally to rethink the way to pay for healthcare in the United States, perhaps opening a window for reform. Meaningful reform should imagine a better overall financing system ten to twenty years from now, rather than just trying to plug the most egregious holes in the existing system. This long view might produce counterintuitive results, likely focusing on reforms that will, in part or in whole, reach people who already have health insurance, rather than taking a laser focus to address the needs of the uninsured. But doing so could eventually produce a simpler and more equitable structure

Health Care Spending and Financial Security after the Affordable Care Act

Health insurance has fallen notoriously short of protecting Americans from financial insecurity caused by health care spending. The Patient Protection and Affordable Care Act (“ACA”) attempted to ameliorate this shortcoming by regulating health insurance. The ACA offers a new policy vision of how health insurance will (and perhaps should) serve to promote financial security in the face of health care spending. Yet, the ACA’s policy vision applies differently among insured, based on the type of insurance they have, resulting in inconsistent types and levels of financial protection among Americans. To examine this picture of inconsistent financial protection, this Article offers a taxonomy to describe ways in which health insurance regulation can promote financial security. It then uses this taxonomy to map the effect the ACA will have on the financial security of various insured populations. Specifically, it analyzes how much a person in poor health might spend out of pocket on health care in three scenarios: a person with average coverage through an individual-market health insurance exchange, a worker with employer-sponsored insurance, and a retiree with Medicare and a supplemental insurance plan. This analysis reveals two effects. First, the ACA alleviates financial risk from health care spending to some degree in all three scenarios. But, secondly, the ACA preserves (and may even exacerbate) variability in the degree and type of financial risk remaining across the three scenarios. In effect, the ACA asserts and affirms different visions of the role of health insurance in promoting financial security for different people. This inconsistency leaves some insured especially vulnerable to spending and creates complexity that may impede insured from comprehending these points of vulnerability

Reimagining the Risk of Long-Term Care

U.S. law and policy on long-term care fail to address the insecurity American families face due to prolonged illness and disability-a problem that grows more serious as the population ages and rates of disability rise. This Article argues that, even worse, we have focused on only part of the problem. It illuminates two ways that prolonged disability or illness can create insecurity.The first arises from the risk of becoming disabled or sick and needing long-term care, which could be called care-recipient risk. The second arises out of the risk of becoming responsible for someone else\u27s care, which I call next-friend risk. The law and social welfare policy has focused on the first, but this Article argues that the second equally threatens the wellbeing of American families. While attempting to mitigate care-recipient risk, in fact, the law has steadily expanded next-friend risk, by reinforcing a structure of long-term care that relies heavily on informal caregiving. Millions of informal caregivers face financial and nonmonetary harms that deeply threaten their own long-term security. These harms are disproportionately experienced by people who are already vulnerable-women, minorities, and the poor. Scholars and policymakers have catalogued and critiqued these costs but treat them as an unfortunate byproduct of an inevitable system of informal care

Cost-Sharing Reductions, Technocrat Tinkering, and Market-Based Health Policy

The Trump Administration has exposed both the durability and vulnerability of the Patient Protection and Affordable Care Act’s insurance reforms. One of the Administration’s first strikes at “Obamacare” was to discontinue federal government payment of cost-sharing reductions, which insurers pay to low-income enrollees on the exchanges to reduce their out-of-pocket share of medical spending. The states struck back with a clever solution that could hold insurers and enrollees harmless. This Article examines this strategy and why, while impressive, it reaffirms larger problems with the ACA’s market-based approach to health reform and the need for new pathways forward

Health Care\u27s Market Bureaucracy

The last several decades of health law and policy have been built on a foundation of economic theory. This theory supported the proliferation of market-based policies that promised maximum efficiency and minimal bureaucracy. Neither of these promises has been realized. A mounting body of empirical research discussed in this Article makes clear that leading market-based policies are not efficient — they fail to capture what people want. Even more, this Article describes how the struggle to bolster these policies — through constant regulatory, technocratic tinkering that aims to improve the market and the decision-making of consumers in it — has produced a massive market bureaucracy. To illustrate the growth the of market bureaucracy, this Article traces the origin and development of several market-based theories that have been central to the modern era of health law. The first, called managed competition, looks to consumerism in insurance markets and contends that people will choose wisely among health plan options, and their choices will drive higher value health care. The second relies on consumerism when using medical care. Sometimes called consumer-driven health care, the notion is that when people are subject to a share of the costs, they will more selectively choose when and where to use medical care and will avoid low-value care. The final example considers the application of antitrust to health care mergers, ostensibly to create a competitive field on which consumerism can flourish. This Article shows that, in application, none of these ideas has, nor will ever, deliver as imagined in a world that deviates from theory. Nonetheless, they continue to spawn a vast web of health law regulation in their support. The cost of this market bureaucracy includes the scaffolding to hold up an ineffective market-based structure and, more importantly, the opportunity cost of driving out better alternatives to solving important health care challenges. Health care’s market bureaucracy endures in light of this failure in part due to politics and political economy, a point others have illuminated well. Yet, this Article suggests that it persists equally because of its elevation of values of individualism and choice. Choice is especially appealing when it comes to decisions about our health, where we want to believe we are in control, but choice has proven empty as conceived. Understanding that markets do not actually enhance choice—and are as bureaucratic as any other approach — can clear the way to ask how to design health law and policy that better produces what the polity genuinely values

The Reverberating Risk of Long-Term Care

The Fiftieth Anniversary of Medicare and Medicaid offers an opportunity to reflect on how American social policy has conceived of the problem of long-term care. In this essay, I argue that current policies adopt too narrow a conception of long-term care risk, by focusing on the effect of serious illness and disability on people who need care and not on the friends and family who often provide it. I propose a more complete view of long-term care risk that acknowledges how illness and disability reverberates through communities, posing insecurity for people beyond those in need of care