Policy & Regulation News

‘Affordable’ Affordable Care Act as Sustainable Cost Model

By Jacqueline DiChiara

King v. Burwell's aftermath has been both praised as a “positive” and “disastrous” ruling as the dust continues to clear following last Thursday’s decision from the Supreme Court.

King v. Burwell

Ralph S. Tyler, Partner Venable LLP, Former Chief Counsel at the FDA, and Former Insurance Commissioner of Maryland, spoke with RevCycleIntelligence.com about the greater industry wide implications of last week’s King v. Burwell decision from the Supreme Court.

Tyler says last week’s decision solidifies and confirms the position and viability of the Affordable Care Act (ACA) and largely settles the question of whether insurance will be provided to most Americans.

“The most surprising part of the development or evolution of the implementation of the ACA has been the number of states that at least so far have not taken advantage of the Medicaid expansion,” Tyler states. “The fact that there are large states in our country which have not taken advantage of the Medicaid expansion is unfortunate and, more fundamentally, a large gap in the coverage that was intended to be provided,” he adds.

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  • Over time, Tyler predicts people and political leadership among even more conservative states will recognize it is in the state’s best interest to provide health coverage for its most vulnerable citizens. “I expect this will be an incremental process and the states that haven’t participated will come around in the next couple of years,” he confirms.

    “While the court’s decision in King was undeniably an important one, it’s really a status quo decision. King leaves in place the Affordable Care Act and allows it to continue to operate as distinguished from the transformative and disruptive impact if the case had come out the other way,” Tyler maintains.

    Tyler says what now needs to be addressed following the ruling is a new focus on the affordable part of the Affordable Care Act to provide universal coverage within a sustainable cost model – a fundamental problem in healthcare’s payment incentive system.

    “The system mostly compensates for treatments and not for outcomes. It incentivizes healthcare events with too little regard for outcome and medical value. We’ve got to get away from that and start moving towards a system that rewards performance of outcomes, not just performance of services,” he states.

    Tyler says even before the ruling was made, the plaintiff petitioners failed to provide plausible answers to several core questions: “Was it really believable that Congress intended to deny subsidies to people who purchased insurance through federal exchanges, and what evidence supported that? What were the consequences of their position? Were the Supreme Court to come out the opposite of the way it did, what was going to happen in the real world and what would be the impact on millions of people?” Tyler asks. “To just brush that off and say Congress will take care of it was a pretty thin response,” he adds.