The national debate over the function of the Affordable Care Act (ACA) includes significant disputes concerning the influence of health insurance on population health outcomes. It is expected that replacing Obamacare will make it more difficult for millions of Americans to obtain medical coverage. There have been political discussions about whether a lack of access to health care leads to negative health consequences such as mortality. Nonetheless, assessing the impact of medical insurance on population well-being and treatment results is becoming increasingly difficult since such indicators require long timelines to create and are sometimes loaded with confounding factors. This is due to the fact that changes in medical coverage are frequently connected to other contextual variables that influence medical care usage. This paper discusses the purpose of medical insurance, the current medical insurance landscape in the United States, and the influence of medical insurance coverage on health care utilization, illness treatment, outcomes, and self-reported health.
Purpose of Health Insurance
One of the key functions of medical insurance is to achieve financial risk management objectives. In certain cases, health insurance has been linked to increased financial stability. For example, the Oregon Health insurance experiment found that persons covered by Medicaid had significantly better financial health than the uninsured. This accounted for a $390 average decline in billed medical bills and the elimination of escalating out-of-pocket expenditures (Sommers et al., 2017). Other studies, such as the ACA’s 2014 Medicaid expansion, according to Sommers et al (2017) have revealed similar changes, including reduced bill collections and bankruptcies. The two studies thus confirmed that insurance coverage reduces the risk of large unpredictable medical costs.
Maintaining Good Health
Keeping good health in control with frequent checks keeps total expenditures low. It also makes it simpler to detect diseases like cancer or diabetes early, allowing treatment to begin immediately. Early detection also raises the likelihood of a positive outcome if the doctor does discover something. Since the adoption of the Affordable Care Act, most preventative care has been covered at no additional cost to the patient. The insurance will cover the hospital visit as long as the doctor or medical provider defines it as “preventive.”
The Current Medical Insurance Landscape in The US
The majority of developed nations have created national health insurance programs. However, the United States stands apart for providing a patchwork of private and governmental sources of coverage, leaving approximately 8.8% of its population uninsured (Berchick et al., 2018). Additionally, according to Berchick et al (2018), employer-provided coverage accounted for 56.0% of the insured population, followed by Medicare at 17.2%, Medicaid at 19.3%, and private health insurance acquired directly from an insurer at 67.2%.
The lack of a unified healthcare system in the United States has resulted in considerable coverage gaps. Young adults between the ages of 19 to 34, racial and ethnic minorities (particularly Hispanics), those with low educational attainment, people with low incomes, and self-employed people are the most likely to lack insurance (Berchick et al., 2018). Uninsured people are less likely to have a regular source of health care, more likely to have difficulty receiving timely care, and less likely to use medical care than insured people.
Health insurance providers in the United States have also highlighted a variety of equality and efficiency concerns, particularly in relation to employment-based coverage. Employer payments to an employee’s health insurance premium, for example, are tax-deductible, resulting in a $209 billion revenue loss in 2004 (Frean et al., 2017). This “tax subsidy” exacerbates moral hazard by incentivizing consumers to acquire more comprehensive coverage. Because the value of the tax deduction is determined by an individual’s marginal tax rate, it is a regressive subsidy that benefits higher-income employees rather than lower-income people.
Providing coverage in the workplace results in labor market inefficiencies. Workers may be discouraged from changing employment or retiring early, and their labor force participation may be altered in order to qualify for coverage. Means-tested public insurance, such as Medicaid can also generate perverse incentives in which individuals change their work hours and incomes to ensure that family members are covered (Frean et al., 2017). Expanded Medicaid eligibility and implementation have also resulted in a crowd out of private insurance. In this example, commercially insured low-income employees with dependents eligible for public coverage replace private coverage with public coverage.
Despite the fact that the United States has failed to address these issues through extensive health insurance reform, public policy has not remained completely inactive. During the 1990s, Medicaid expansions helped to reduce the number of uninsured children (Frean et al., 2017). Furthermore, recent legislative attempts emphasizing voluntary enrollment in private coverage via tax credits, small-group, and individual insurance market changes, and employer premium subsidies have not reduced the number of the uninsured. As a result, numerous jurisdictions have made it mandatory for individuals to purchase private insurance. Nonetheless, outreach activities have attempted to deliver information to people who are eligible but have not registered for public coverage.
The Influence of Medical Insurance Coverage
Insurance must enhance patient care in order to improve health, not merely the way it is paid for. According to Sommers et al (2017), the ACA’s coverage expansion was linked to greater rates of having a go-to provider and being able to pay for necessary care—factors often linked to improved health outcomes. More robust experimental and quasi-experimental data demonstrates that coverage expansions have similar effects on primary care access, ambulatory care visits, prescription drug usage, and medication adherence.
Chronic Disease Care and Outcomes
The effects of insurance coverage on cancer, the top cause of mortality among non-elderly persons in the United States, have been studied. Though not all cancers cause chronic disease, the majority of cancer diagnoses need continuous treatment, and roughly 8 million U.S. persons under the age of 70 are now living with cancer (Sommers et al., 2017). Aside from increased cancer screening, health insurance may enable more prompt or effective cancer care. However, the data is equivocal on this front. A study of Massachusetts’ reform found no improvements in breast cancer stage at diagnosis, but the ACA’s dependent-coverage provision was connected with earlier cervical cancer detection and treatment among young women (Sommers et al., 2017). Additional study is needed to determine the effects of coverage for many other ailments, such as asthma, renal disease, and heart failure. According to Sommers et al (2017), getting coverage boosts access to regular care for those who have any chronic disease. Overall, the picture for addressing chronic physical disorders is complex, with coverage effects possibly differing among diseases and delivery systems.
Well-Being and Self-Reported Health
Although there is conflicting information about results for specific disorders, research from several studies suggests that coverage significantly raises individuals’ sense of their health. In one year, the Oregon research discovered a 25% rise in the proportion of patients reporting “good, very good, or excellent” health, as well as an increase in the number of days in both good physical and mental health (Sommers et al., 2017). Findings from quasi-experimental studies show that self-reported health and functional status improved following Massachusetts’ reform and several state Medicaid expansions made prior to the Affordable Care Act (ACA). Furthermore, self-reported physical and mental health also improved following the implementation of the ACA’s dependent-coverage provision.
References
Berchick, E. R., Hood, E., & C. Barnett, J. (2018). Health insurance coverage in the United States: 2017 (pp. 2-21).
Frean, M., Gruber, J., & Sommers, B. D. (2017). Premium subsidies, the mandate, and Medicaid expansion: Coverage effects of the Affordable Care Act. Journal of health economics, 53, 72-86.
Sommers, B. D., Gawande, A. A., & Baicker, K. (2017). Health insurance coverage and health—what the recent evidence tells us. New England Journal of Medicine, 377(6), 586-593.