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On the Third Hand: Son of PPACA

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Either the U.S. Department of Health and Human Services (HHS) Patient Protection and Affordable Care Act (PPACA) exchange enrollment systems will work, or they won’t.

Either the PPACA public exchange plans will start up in 2014, or they won’t, and, either the PPACA health insurance product rules — especially the individual and small group rules — will take effect in 2014, or they won’t.

It seems hard to tell. I used to try to include disclaimers in my stories along the lines of “if PPACA takes effect as scheduled in 2014 and works roughly as backers expect.”

My editors got sick of reading the disclaimer and made me stop putting it in. Maybe I need to negotiate to get it back into their good graces…

But, anyhow, my guess is that either enrollment will end up going OK, and the next big story to cover will be problems with the “three R’s” — the reinsurance, risk corridor and risk adjustment programs PPACA drafters included in PPACA to try to keep all of the PPACA changes from wiping out nice, warm-looking health insurers that somehow ended up covering all of the really sick people.

If PPACA collapses and blows away, the story will be about the absence of the expected PPACA changes somehow causes risk management problems roughly comparable to what PPACA itself would have created.

The coming year will be a year in which actuaries at Milliman, S&P and Moody’s probably have a shot at getting booked on The Colbert Report. Maybe The Daily Show. Maybe the 2014-2015 television season will be the first television season ever during which a health insurance actuary gets onto Saturday Night Live.

Whatever the nature of the crisis is, chances are that it will somehow burn brightly for a year or so, then calm down and burn with a nice, clear flame for a while.

Then we’ll get back to a new version of what 2002 looked like: Wondering what the next round of “health care reform” will be like. Because, really, either with PPACA or without it, we’ll get some benefit from higher consumer out-of-pocket costs, some from narrower networks, some from a combination of public and private exchanges, and some from sticking it to brokers. But then we’ll be coming face to face with the cold reality that health care costs have stabilized but are still really, really high. 

Early predictions on what the Son of PPACA might look like:

  • A lot like PPACA. I think the parts that people in the insurance industry hate, for example, seem to be pretty small. Since PPACA was passed, for example, I don’t think I’ve received a single press release, legal commentary or survey having to do with the new standards for claim decision appeals. 

  • Tough on aggressive underwriting. I don’t see any Republicans celebrating the idea of coverage rescissions or letting insurers exclude consumers because they happen to be a little overweight.

  • More reliant on public reinsurance programs for people with hemophilia, severe diabetes and other catastrophically expensive conditions. One thing an early PPACA implementation disaster — the failure of the Pre-existing Condition Insurance Plan — taught everyone is that insuring catastrophically sick people is hard. You can’t just wipe away the costs of covering a boy with hemophilia by asking him to fill out a health risk assessment and getting him a nurse case manager.

  • More realistic about benefits than the “I want a pony, then a unicorn, then another unicorn” approach evident in PPACA. Every life is infinitely precious, but, no, it’s actually not.

  • Possibly more rigid in terms of provider network rules than PPACA. We could see some horror stories about the effects of lack of a meaningful level of provider choice.

On the one hand, getting to the point of thinking about the Son of PPACA effort may be pretty ugly and take some time.

On the other hand, this time has been coming since the Clinton health care proposal failed.

On the third hand, the irony is that Hillary Clinton could end up back in the health policy mix just in time to debate proposals that are Daughters of Clinton Care as much as Sons of PPACA.

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