How The Economy Is Today And The Obama Care Act And How It Was 10 Years Argumentative Essay Samples
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A decade back the American economy was on a high growth path. The stock market was booming, with everything appearing bright. Between 2003 and 2005, the economy grew at more than 6% rate year on year (YOY). The unemployment rate was a low 5.3% (“ObamaCare” 2014). Owing to a thriving job market, the number of uninsured was close to 42 million, which was lower than the previous decades. However, the situation has changed completely in the last 10 years (Coughlin et al 2014). The period between 2007 and 2008 experienced one of the worst recessions in the history of the US economy. The rate of unemployment spiked up to 10% in the late 2009. The GDP growth rate plummeted to a near zero in 2008 and 2009 (Coughlin et al 2014). The economy is still recovering from the bad market conditions of 2008. Therefore, it is not possible to compare 2005 with 2015 economically. One of the significant changes to take place during this period was the implementation of Affordable Care Act (ACA), more popularly known as Obamacare. People are divided in opinion as regards the efficacy of Obamacare. Some are of the opinion that Obamacare will be a burden on people in today’s already staggering economy, while some believe that Obamacare will be a boon to the people. This paper would argue that the implementation of Obamacare will make the healthcare process more affordable to people, thereby helping them deal with the current and future economic situations.
More Coverage or More Expenditure
Under the old Medicaid, poor people with no children and poor non-disabled adults were not covered. After Obamacare was implemented, these people were also included. In fact, all the people with an income of up to 138% of the federal poverty line were included ($15,000 for individual and $26,951 for family) (Coughlin et al 2014). Two thirds of the poor people, who were not under the old Medicaid policy, came under Obamacare. This expansion alone will provide 17 million more people coverage at a very affordable insurance premium.
However, it is argued that by trying to cover more people, the cost for the federal government will go up. In fact, it is somewhat true. It is estimated that the federal government will spend almost a trillion dollar from its pocket due to this expansion process. It may start benefitting if the program is successful as intended. However, many think that it is a wastage of taxpayers’ money, which will make the healthcare process less efficient.
Fewer Burdens on State Budgets
During 2005, bills for people under Medicaid coverage were paid by the federal and state governments. In fact, the total unpaid bill to the hospitals during 2005-2006 is estimated to be $40 billion, which was pushing the overall insurance premium up for all (Coughlin et al 2014). Because of domination of a few big private companies in the healthcare market, the healthcare process, though efficient, involved high premiums.10 years back, states had to share a higher burden of the Medicaid. However, under the new ACA related changes, states will receive at least $1 from the federal government for every $1 spent on the Medicaid program (“ObamaCare” 2014). Even for poorer states, the federal government pays up to 75% of the medical bill. This way, the states have less cost burden due to healthcare bills. The medical cost of both states (up by 20%) and the federal government (up by 26%) will go up between 2014 and 2022 (Coughlin et al 2014). However, as more and more people come under the insurance coverage, it will reduce the uncompensated costs for the states, the federal government and hospitals. The overall cost will decrease. The overall uncompensated cost paid by the government 10 years back was more than $100 billion, and it is still more than $100 billion, but if Obamacare is implemented as intended, then this cost will come down drastically.
The main problem is that in the first few years after implementing Obamacare, the cost for the states will increase drastically. Most of the states are already cash strapped after the recession of 2007-2008. The full implementation of ACA will, therefore, put more financial stress on the states. Although the federal government has pledged full support, many wonder if the states, still recovering from the aftermath of recession, can afford to take this extra financial burden at this time or not.
Reduced Pharmacy Cost
Apart from the hospital related costs, Obamacare has also introduced significant changes for prescription drugs. 10 years back, people were not allowed to purchase drugs from outside. However, currently, people covered under Medicaid are allowed to buy prescription drugs from other developed countries, such as Canada and the European Union, if the medicine is available at a lower cost. Obamacare also mandated the U.S. Food and Drug Administration (FDA) to approve generic drugs for most of the common medications (“ObamaCare” 2014). This is also reducing the price of drugs and will further push down cost for the patients in the coming days as FDA approves more generic drugs.
This process will create confusion in the pharmacy drugs market, and this may even open up new avenues for illegal and unapproved drugs to get into the USA. This process of procuring prescription drug from outside weakens the role of FDA and increases the chances of low quality generics to infiltrate the US market.
Currently, Medicaid network is limited. However, under the new ACA, many hospitals and physicians have registered as Obamacare provide better incentive based pay for better service. It pays up to 4% more than normal pay for higher quality treatment and hospital care.
One of the main problems with Medicaid is its payment plan to hospitals and physicians. For example, it pays $50 to an emergency room doctor per hour, whereas other insurance companies pay almost $200 per hour (“ObamaCare” 2014). Because of this, many doctors opted out of Medicaid. In many cases, doctors providing services under Medicaid were less knowledgeable and provided poor quality service. Expansion of Medicaid without addressing this issue will further deteriorate the quality of treatment.
The implementation of Obamacare was slow in the last few years. However, 2014 witnessed a huge spurt of registration in the government insurance programs. In fact, as per data released by the federal government in January 2015, the percentage of uninsured people is 10.8%, which is the lowest percentage from the time data is available. The economy may not be as good of a condition as it was 10 years back, but healthcare reforms surely have made sure that more people are covered and getting at least basic healthcare coverages.
“Medicaid Financing and Reimbursement”. Medicaid.gov. 2014. Web. 6 Feb 2015 <http://www.medicaid.gov/Medicaid-CHIP-Program-Information/By-Topics/Financing-and-Reimbursement/Financing-and-Reimbursement.html>
Coughlin, Teresa A.; Holahan, John; Caswell, Kyle and McGrath, Megan. “Uncompensated Care for the Uninsured in 2013: A Detailed Examination”. Kaiser Family Foundation (KFF). 30 May 2014. Web. 6 Feb 2015 <http://kff.org/uninsured/report/uncompensated-care-for-the-uninsured-in-2013-a-detailed-examination/>
“ObamaCare: Before and After”. Discover the Networks (DTN). 2014. Web. 6 Feb 2015 <http://www.discoverthenetworks.org/viewSubCategory.asp?id=1957#MEDICAIDANDITSINEFFICIENCIES>
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