Changes to Obamacare Could Bring Opportunity for Innovation

Low-income individuals can benefit from incremental improvements to the health care law.
November 19, 2014
By Ron Littlefield  |  Senior Fellow
Ron Littlefield, a former mayor of Chattanooga, Tenn., is a senior fellow with the Governing Institute and its lead analyst on the City Accelerator initiative. A city planner by career, he also consults to government through Littlefield Associates.

The lives of low-income residents change all the time. Daily life is unpredictable, including illness or injury. For the last year, how they dealt with such things changed under the Affordable Care Act (ACA), which brought the promise of coverage and a measure of stability for the previously uninsured.  Even as the second open enrollment period opens under the ACA, they – as with all Americans – face another round of changes under the incoming Congress.

Last week in a USA Today op-ed, Utah Republican Sen. Orrin Hatch wrote that voters had created a “new opportunity to improve American health care by electing a Republican Congress that is firmly committed to repealing and replacing Obamacare.”

It’s no secret that attempting to repeal parts or all of Obamacare has been a high priority on the conservative agenda, as many – if not all – incoming Republican legislators campaigned in opposition to the ACA and vowed to “repeal and replace.”
 
Now that the political ground has shifted and Republicans have a clear majority in both houses of Congress, it is expected the still-nascent ACA will continue to come under fire. There is no doubt spirited debates will ensue. While a full repeal with President Obama in office is improbable, hearings, investigations and aggressive oversight are a near certainty and funding reductions or changes to certain provisions of the law are likely. Where the pieces will fall and what will be left standing is anyone’s guess.
 
Sen. Hatch was right: It can be a time of new and great opportunity. If there ever was a need for innovation, it is now.
 
After the basic necessities – food, shelter and clothing among them – health care is an almost equal essential ingredient toward an acceptable quality of life. But cities and counties continually struggle to ensure citizens living in poverty, low-income families with children and homeless individuals receive an adequate level of medical care.
 
At the heart of the issue, of course, is cost. The harsh reality is that health care always comes with a price. People get sick and – in the process of making them well again – somebody has to pay. It is also widely accepted and well documented that ignoring health problems often increases the price of treating them. Undiagnosed conditions such as diabetes and high blood pressure eventually lead to more serious problems and expenses escalate. As the old saying goes, "Pay me now or pay me later – but if you pay me later, pay me more." 
 
There are successful examples of single entities and municipalities working on innovative solutions to their health care-related conundrums. Recognizing that prevention and early detection lowers costs and a healthy workforce is good for production, many companies and some local governments have instituted their own primary care facilities. This is actually an old idea from the Industrial Age when many employers had their own doctors on staff. My city, Chattanooga, set up its own clinic and pharmacy a few years ago to serve employees and their dependents. Even after accounting for additional costs for staff and facilities to provide free primary health care, we saw total health care expenses stabilize. More importantly, simmering conditions that had long gone undetected were found and treated – including cancer, heart disease and other often lethal afflictions. Lives were saved. 
 
One day, after a particularly difficult negotiating session with our municipal unions, a representative said to me: “Well, Mr. Mayor, we’ve been here for hours and you haven’t given us much in wage increases, but I have to admit that whenever I go to the clinic or get a prescription filled at the city pharmacy, I get a raise.” While it may be hard to see at first or measure, health care does improve the quality of life for those that are covered.
 
Another old idea that has taken on new importance is that of the community health clinic. Many cities and some major hospitals are ramping up community health clinics to serve those without regular access to health services. The payoff for the health provider and the public comes in terms of lower costs for acute care – fewer trips to the emergency room and earlier disease intervention result in less expensive treatment and the like. Many community health facilities were established 50 years ago as part of the War on Poverty but the changing structure of the national health care system has given them new life as points of intake and referral for the ACA.
 
Which brings us back to the original topic at hand. As lawmakers who campaigned on the promise to “repeal and replace” Obamacare take office and other new challenges to the ACA take shape, the big question is: “What’s next?”
 
An article in The New Republic, “Eight Reasons to Stop Freaking Out About the Supreme Court’s Next Obamacare Case,” attempts to lay to rest concerns about pending judicial actions. One of the author’s reasons stands out: “Irrespective of the legal questions, and questions about judicial temperament, the justices will be made well aware of the fact that a knee-jerk ruling in favor of the challengers will kill people.”
 
That might be characterized as an editorial overstatement, but the fact remains that in addition to increased financial costs another irrefutable effect of poor health care is early death. Chattanooga's experience with its free clinics proved that to be true. The ACA is unquestionably a part of our medical landscape. It is part of our national safety net and is now thoroughly wired into the system. Major insurers and health care providers have spent millions adjusting to the new realities and, while some might not have been champions or early adopters, most now base their business models on the effects of the legislation. At this point, drastic action either by the courts or Congress would be disruptive in a very negative way. Decision-makers know this to be true.
 
However, there is always room for improvement. There are still holes in the social safety net and a more comprehensive, less porous national health care system might just bring additional benefits and spark increased entrepreneurial activity and innovation. As it stands, many creative and potentially more productive individuals are hampered by the lack of a more universal health care system. Some have no health care at all and others are underemployed – tied to jobs and benefits packages that keep them from realizing their full potential.  
 
There is a cost to Obamacare, just as there is a cost for health care in general. And yes, there should be changes. But this is not a time to retreat from reality. If we take this opportunity for incremental change and improvement, a negative becomes a positive. By unshackling individuals from the fear and worry associated with health care and thereby unleashing new creative spirits and entrepreneurial efforts, we obtain an improved business climate for our society and a better quality of life for individuals. To paraphrase that Chattanooga union official, “We get a raise.”
 
 
Be part of the campaign for civic innovation at the City Accelerator, presented by Citi Foundation.