Consumers and businesses that are expecting the Affordable Care Act (aka Obamacare) to result in lower costs for health care are going to be disappointed, the head of Hawaii Medical Service Association told us Wednesday.
Michael Gold, president and CEO of HMSA, told The Maui News that some people will suffer "rate shock" as premiums go up initially as the ACA is implemented. Gold explained that folks who have traditionally had health insurance coverage will be helping to pay for those who have not.
Gold said the operation of the health insurance exchanges to ensure a selection of companies for the uninsured will be an ongoing cost. He said federal funds will help pay for the initial setup of the exchanges (Hawaii's will be called the Hawaii Health Connector), but that there is an estimate of about a 2 percent increase in premiums that will be needed for ongoing costs.
The HMSA chief said that ongoing cost will simply become part of the base rate.
In a further discussion about reining in health care costs, Gold explained that the only way to achieve true reductions is to change the whole mindset of providers - and insurance companies.
Doctors and hospitals are now compensated for the quantity of services and procedures they provide. Gold believes that quantity of services needs to be replaced by quality of services. That involves not just treating the sick or injured, but also keeping people well.
Our take from the meeting was that health care costs will continue to rise for the foreseeable future. Getting the uninsured insured may be a worthy goal, but the ACA apparently does nothing about skyrocketing costs.
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