Like a lot of blue-state health-watchers, Marna Borgstrom and Jennifer Prah Ruger were relieved Thursday at the U.S. Supreme Court’s surprise decision to preserve the bulk of President Obama’s health-care law.
They also kept their eye on less-noticed dangers on the horizon as the law moves forward.
Borgstrom (pictured), CEO of Yale-New Haven Hospital, and Ruger, a Yale public-health and law professor, were among the legions of experts parsing the fine print in the hour after the Supreme Court announced its surprise 5-4 ruling to uphold the president’s Affordable Care Act.
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“I feel the way I think most of my industry colleagues really do” about the overall ruling, Borgstrom said in an interview. “This was the only possible outcome if you look at what’s good for health care and what’s good for the people we care for. I tried to wrap my head around what would happen if they struck down the mandate or if they struck down the decision. It was unfathomable.
“My fear was they would take down down the mandate [that everyone buy insurance] and leave the rest of it in place, which says there are more expectations and less money to cover it.”
Still, to Borgstrom, the reform train—demanding hospitals keep and get people better care for less money—had already left the public-policy station. Private employers and government budget crunches were already forcing hospitals to help “knit the pieces of the system together better,” she said in an interview. But even with the law intact, she is concerned about purely budget-driven, rather than policy-driven, federal decisions on Medicare.
Medicaid was on the mind of Ruger. While the ruling enables Connecticut to proceed full-force with like-minded health reforms, one portion will enable other states to do less for those who can’t afford insurance—compromising the nation’s ability to set a common standard for people’s care, Ruger said.
1 Nation, 2 Medicaids?
She was surprised that Chief Justice John Roberts proved the decision’s swing vote, not the usual justice on whom court-watchers focus, Anthony Kennedy. Roberts, a conservative, joined the court’s “liberal” wing in deciding that the law’s monetary linchpin—a mandate that everyone buy health insurance—is constitutional. Roberts agreed with critics that the Obama administration was wrong to justify that mandate on the basis of the Commerce Clause regulating interstate commerce. But he agreed with a secondary Obama administration argument: That the mandate can be considered a tax on people who don’t buy insurance, and that tax is constitutional.
In the one minor blow to Obama’s law, a majority of the justices struck down a portion of the law that would withhold all federal Medicaid money from states that don’t follow new rules, including covering adults who earn up to 133 percent of the federal poverty level. States—which administer Medicaid—have different rules for who gets the government health insurance for the poor.
But the ruling does allow the act to reward states that expand Medicaid. It allows the federal government to send millions of new dollars to states to cover that new expansion. But it lets states refuse to take the money, refuse to expand the Medicaid rolls, and keep the federal Medicaid money they were already receiving. (Read a summary of that aspect of the ruling here.)
Some states—like Connecticut—could give poor people better health coverage under Medicaid than will others, including southern states whose Republican governors disagree with the idea of expanding the safety net and federal involvement in health care.
Ruger (pictured) called variation in Medicaid coverage “problematic.” She said people’s health “outcomes”—how many people get or stay sick or get coverage—could vary from state to state as a result of the Supreme Court ruling. The country needs a common standard, she argued.
“Health is a special thing that every human needs and wants. Somebody who lives in Mississippi shouldn’t have less of a chance to have their health needs met and achieve a good health outcome than somebody who lives in Massachusetts. There’s a universal aspect to it,” Ruger said in an interview.
She said she agrees with the argument that states are “important laboratories” to test approaches to policy. They should be free to test ideas for “how to get there” in achieving better results in health care, she said—but not to set lower standards for care. Like how poor you need to be to get Medicaid. Or when you can see a doctor or receive in-patient mental-health care when someone needs it.
Ruger recently published an article on the subject in the New England Journal of Medicine, entitled “Fair Enough? Inviting Inequities in State Health Benefits.” Read it here. In the article, she argued that the Obama administration was already allowing too much variation for specific Medicaid coverage rules under its interpretation of the law. But it was still insisting that more people, adults reaching the 133 percent threshold, be included. The Supreme Court decision changes that.
Pressure Still On Hospitals
Medicaid is also a central concern for Yale-New Haven’s Borgstrom, since she runs an urban hospital with a high Medicaid and Medicare case load.
Hospitals like Yale-New Haven and other hospitals had already agreed to support $155 billion in Medicare reimbursement cuts nationwide over the next decade as part of the reform deliberations, she noted. Then, after the law passed, the Congressional Budget Office came out with a revised projection—that even more cuts would be needed to keep the system solvent.
“That’s the thing I worry about more” than court decisions, Borgstrom said—that “further cuts in payments are not going to be policy based but because the CBO says you’ve got to cut more.”
Either way, hospitals must respond to pressure to provide better care at lower cost, she said. Court ruling or not, federal law or not, private employers were making sure of that.
Borgstrom said she saw the need for that not only as a health care provider, but as an employer—one that self-insures 30,000 people when you count employees and their dependents.
“Any employer providing insurance was saying, ‘It’s not our problem if the federal and state government underpay you we can’t pick up the difference. It’s a hidden tax,’” Borgstrom said. “We had already said we had to knit the pieces of the health care system better. We were going down that path regardless.”
Click here for a story on the breakdown of how the now-preserved federal law affects people.
In preparation for Thursday’s ruling, the federal government issued state-by-state figures. According to a federal health website, thanks to the law:
• Around 23,000 Connecticut adults under 26 gained health insurance because of a requirement that they be allowed to stay on their parents’ plans.
• 42,224 Connecticut Medicare patients have saved a total of $44,764,074 on prescription drugs because of a “donut hole” reimbursement.
• 422,154 Connecticut seniors on Medicare got free colonoscopies, mammograms, or other preventive help in 2011.
• The state has received more than $1 million to “fight unreasonable [insurance] premium increases.”
• 322 uninsured Connecticut people with preexisting medical conditions have been able to get coverage.
(Click here to see the full list.)