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Health Care Reform
Quynh Smith
Sources of Inefficiency in the
Health Care Delivery System
 We spend a substantial amount on high cost, low-value
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treatments.
Patients obtain too little of certain types of care that are
effective.
Patients frequently do not receive care in the most costeffective.
There is extensive variation in the quality of care
provided to patients.
There are many preventable medical errors that lead to
worse outcomes.
Our system is complex and we have high administrative
costs.
What is Health Care Reform?
 Broaden the population that receives health care
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coverage through either public sector insurance
programs or private sector insurance companies
Expand the array of health care providers
consumers may choose among
Improve the access to health care specialists
Improve the quality of health care
Decrease the cost of health care
Trends in Health Care
Spending and Cost
Overall Spending
 Based on Organization of for Economic CoOperation and Development (OECD):
 The U.S. devotes considerably more of its
economy to health care than other developed
countries.
 U.S. health spending as a share of GDP in 2006
(15.3%) was considerably higher than all other
countries, including Canada (10.0%), France
(11.0%), Germany(10.6%), Japan (8.1%), and
the United Kingdom (8.4%).
 Switzerland was a distant second to the U.S.,
devoting an estimated 11.3% of GDP to health
care.
Overall Spending
 According to the Centers for Medicare and Medicaid
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Services (CMS), the U.S. is projected to spend over
$2.5 trillion on health care in 2010, or $8,160 per U.S.
resident.
Health spending in 2009 is projected to account for
17.6% of GDP.
In 1970, U.S. health care spending was about $75
billion, or $356 per resident, and accounted for 7.2%
of GDP.
Health care spending has risen about 2.4 percentage
points faster than GDP since 1970.
CMS projects that by 2018, health care spending will
be over $4.3 trillion, or $13,100 per resident, and
account for 20.3% of GDP.
Distribution by Service
Sources of Health Spending
 Between private and public sectors,
private health spending accounts for 54%
of total health spending in 2007.
 64% expenditures from private health
insurance
 22% expenditures from out-of-pockets
 13% by other private sources (philanthropy)
Sources of Health Spending
 CMS projects that the private share of
national health spending will fall to 49% by
2018, with public spending growing to 51%
as the oldest baby boomers become
eligible for Medicare.
Rises in Premiums of Health
Insurance
 Between 1999-2008, the cumulative
growth in insurance premiums was 119%.
 Compared with cumulative inflation of 29
% and cumulative wage growth of 34%.
Uninsured in America
Percent of Americans Uninsured by
Age
Who Are the Uninsured?
 More than eight in ten of the uninsured are in
working families—about two thirds are from
families with one or more full-time workers and
14% are from families with part-time workers.
 About two-thirds of the uninsured are poor or
near poor.
 Adults are more likely to be uninsured than
children.
 The number of nonelderly uninsured Americans
rose to 45.7 million in 2008 amidst rising
unemployment rates and an economic recession.
2009 Federal Poverty Line
American Recovery and
Reinvestment Act 2009
Provided over $2 billion to expand the
number of sites, increase services at
existing CHCs, and provide supplemental
payments for spikes in the number of
uninsured CHCs serve as a result of the
recession.
Texas vs. United States
Texas vs. United States
Texas vs. United States
President Obama’s
Proposal
President Obama’s Health Plan
 Reduce long-term growth of health care costs for
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businesses and government
Protect families from bankruptcy or debt because of
health care costs
Guarantee choice of doctors and health plans
Invest in prevention and wellness
Improve patient safety and quality of care
Assure affordable, quality health coverage for all
Americans
Maintain coverage when you change or lose your job
End barriers to coverage for people with pre-existing
medical conditions
Public Opinion on Health
Reform
Health Care Proposals
Senate Democratic Bill (Patient Protection
Affordable Care Act)
And
House Bill (Affordable Health Care for
America Act)
The House and Senate versions:
 Insurance reforms to protect consumers from
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insurance company worst-practices – like
denying coverage based on pre-existing
conditions, capping total coverage, and dropping
or watering down coverage when you get sick
and need it most
Consumer protections that will restrict how much
of your premium dollars insurance companies
can spend on marketing, profits, salaries.
Creation of a health exchange to increase
consumer choice and guarantee coverage
A commitment to expanding health coverage
Affordable health options, with subsidies for
working families and a hardship waiver
Tax credits to help small businesses afford
coverage
The House and Senate versions:
 Improvements in the health status of our population
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by investing in prevention and chronic disease
management
Making preventive care completely free – with no
copayments or deductibles
Lowering the cost of health care for our seniors
Improving the quality and extending the life of
Medicare
Strengthening our primary care workforce
Reforming the delivery system
Ensuring that reform is not only fully paid for, but
actually significantly reduces the federal deficit
Health Reform Subsidy
Calculator
Senate Democratic Bill
Single Adult: Age 25
Annual
Income
$14,404
% Poverty
150
Annual
Income
$21,660
% Poverty
200
Annual
Income
$43,320
% Poverty
400
Actual annual plan premium:
Medicaid
$2,637
$2,637
Cap on premium as % of income:
Medicaid
6.3%
9.8%
Person/family premium payment:
Medicaid
$1,365
$2,637
% of total premium paid by person/family:
Medicaid
52%
100%
Person/family payment as % of income:
Medicaid
6.3%
6.1%
Government subsidy:
Medicaid
$1,273
$0
Note: Subsidies are only available for people purchasing coverage on their own in the Exchange (not through
an employer). All individuals and families with incomes at or below 133% of the federal poverty level will be
eligible for Medicaid. Others with higher incomes may also be eligible, depending on rules that vary by state.
Senate Democratic Bill
Age 25: Family of 4
Annual
Income
$29,327
% Poverty
133
Annual
Income
$44,100
% Poverty
200
Annual
Income
$88,200
% Poverty
400
Actual annual plan premium:
Medicaid
$7,108
$7,108
Cap on premium as % of income:
Medicaid
6.3%
9.8%
Person/family premium payment:
Medicaid
$7,108
$7,108
% of total premium paid by person/family:
Medicaid
39%
100%
Person/family payment as % of income:
Medicaid
6.3%
8.1%
Government subsidy:
Medicaid
$4,330
$0
Note: Subsidies are only available for people purchasing coverage on their own in the Exchange (not through
an employer). All individuals and families with incomes at or below 133% of the federal poverty level will be
eligible for Medicaid. Others with higher incomes may also be eligible, depending on rules that vary by state.
House Bill
Single Adult: Age 25
Annual
Income
$16,245
% Poverty
150
Annual
Income
$21,660
% Poverty
200
Annual
Income
$43,320
% Poverty
400
Actual annual plan premium:
Medicaid
$3,169
$3,169
Cap on premium as % of income:
Medicaid
5.5%
12.0%
Person/family premium payment:
Medicaid
$1,191
$3,169
% of total premium paid by person/family:
Medicaid
38%
100%
Person/family payment as % of income:
Medicaid
5.5%
7.3%
Government subsidy:
Medicaid
$1,978
$0
Note: Subsidies are only available for people purchasing coverage on their own in the Exchange (not through an
employer). All individuals and families with incomes at or below 150% of the federal poverty level will be eligible
for Medicaid. Others with higher incomes may also be eligible, depending on rules that vary by state.
House Bill
Age 25: Family of 4
Annual
Income
$33,075
% Poverty
150
Annual
Income
$44,100
% Poverty
200
Annual
Income
$88,200
% Poverty
400
Actual annual plan premium:
Medicaid
$8,543
$8,543
Cap on premium as % of income:
Medicaid
5.5%
12.0%
Person/family premium payment:
Medicaid
$2,426
$8,543
% of total premium paid by person/family:
Medicaid
28%
100%
Person/family payment as % of income:
Medicaid
5.5%
9.7%
Government subsidy:
Medicaid
$6,117
$0
Note: Subsidies are only available for people purchasing coverage on their own in the Exchange (not through an
employer). All individuals and families with incomes at or below 150% of the federal poverty level will be eligible
for Medicaid. Others with higher incomes may also be eligible, depending on rules that vary by state.
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