Understanding the Affordable Care Act

How the Affordable Care Act will affect you and New Hampshire

On New Year’s Day, 2014, the long-talked about and hotly debated Affordable Care Act (once-derided as but now commonly called Obamacare, even by the President) will be fully implemented. It is President Obama’s chief legislative initiative to expand access to health care to those presently without it. 

“The Affordable Care Act will have a profound impact on how health care is delivered and paid for in our country,” says Steve Ahnen, president of the New Hampshire Hospital Association. “Like Medicare and Medicaid in the 1960s, it will, despite its inherent controversy, be a seminal moment in the course of history.”

But it relies heavily on the states to play a lead role. To get them on board the feds sweetened the deal by promising to pay for all the costs for the first few years to cover the law’s two bookends — expanding Medicaid coverage to include lower income workers and creating a healthcare exchange to allow people and businesses to purchase health insurance from a larger (and thus less-expensive) pool. 

Here in New Hampshire, where approximately 170,000 people are uninsured, there has been something like political schizophrenia. Two years ago the Republican-controlled Legislature forbade the state from adopting the ACA because of distaste for federal meddling and the potential of leaving them in the lurch without necessary funds. With the Democrats now controlling most of state government, leaders are embracing the idea as being too good to turn down.

This policy swing has left bureaucrats playing catch-up. So many questions remain unanswered, but the basics look like this.

Expand Medicaid: Medicaid is a 1960s “Great Society” program that provides medical and healthcare services to low income and some disabled people. It is managed by the states, and New Hampshire is one of the few states to continue to use a so-called “fee for service” model, meaning each procedure has a set price established and has the distinction of having the lowest provider reimbursement rate in the country.

This leaves the providers — in most case the hospitals — short. Typically, the state pays around 50 cents on every Medicaid-billed dollar. But short is better than nothing, which is what providers get when a patient is without coverage, so expanding Medicaid is very popular with the state’s financially ailing and overstressed hospitals.

Since most of the estimated 58,000 people who will soon become eligible (but still must apply) for Medicaid and receive coverage, they will presumably catch problems and seek treatment sooner and use health care more efficiently. And they will be less likely to use the most expensive portal to health care — the emergency room. 

Health Exchange: Even with the expansion of Medicaid, there remain approximately 112,000 Granite Staters without coverage or with inadequate coverage. By definition, these people are not low income and presumably chose for various reasons not to get coverage. The law mandates that larger employers with more than 50 employees provide coverage and individual families to find their own (and also provides some tax credits for those purchases). To do that, states may create their own market pool of insurance providers or rely on a federal one, both of which would be cheaper and more comprehensive than current market options. The law also sets essential benefits that each plan must offer.

For the vast majority of the people presently covered, the ACA would have little impact but would prohibit insurance companies from unpopular acts — like canceling or denying policies for pre-existing conditions and ending parents' coverage of college-age children.

“The focus of reform,” Ahnen says, “is designed to ensure that people get the right care, at the right time and in the right place, every time providing better quality and lower costs.” 

By the numbers

  • NH uninsured population: 170,000
  • Proposed coverage by expansion of Medicaid: 58,000 (to include people making less than $15,800 a year per household)
  • Target population for the health exchanges: 112,000

Each year we pose a series of questions to New Hampshire doctors via the Top Doctors survey. For 2013 we asked them what impact - good and bad - the Affordable Care Act will have on the future of health care. Here are their answers:

Question: How would you rate the Affordable Care Act?
On a scale of 1 to 10, do you believe the Affordable Care Act will have an overall positive or negative effect on our healthcare system? 1 indicates a completely negative outcome while 10 indicates a completely positive outcome.

1 indicates a completely negative outcome while 10 indicates a completely positive outcome.


Question: What positive change or impact do you hope the Affordable Care Act will have on our healthcare system?

Here are the 5 most popular answers from doctors:

  1. Overwhelmingly, the top response was better access to health care and greater coverage for a larger number of people.
  2. Coverage of children on parents’ plans until age 26
  3. Pre-existing conditions will no longer preclude people from accessing affordable insurance.
  4. Increased access to preventative care will help reduce more serious issues.
  5. Electronic medical records will help increase efficiency.

Question: What negative change or impact do you fear the Affordable Care Act will have on our healthcare system?

Here are the 5 most popular answers from doctors:

  1. More bureaucracy and/or paperwork and over-regulation
  2. Increased costs of health services and increased administrative costs
  3. Fewer doctors. Some fear lower payments to providers could potentially discourage young people from entering the medical field in the future, which will ultimately result in too many patients per doctor. This would create longer wait times and shorter patient visits.
  4. A more immediate “overloaded system” with too few doctors to handle the new influx of people who can now gain access to health care that will result in shorter patient visits.
  5. If it fails, we’ll be in a worse position and true reform will be even harder to achieve.
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