Transformation of our HealthCare System under ACA

According to FACTCHECK, per capita health care costs have been rising at just under 3 percent a year over the last four years, but that’s less than half the average annual growth in the preceding eight years.

The Centers for Medicare & Medicaid Services calls the effect of the ACA on the slowdown “minimal.” and cites the following reasons:

  • The economic slowdown and subsequent sluggish recovery
  • Drops in some prescription drug costs brought about by the expiration of patents on several costly medications including Lipitor, Plavix and Singulair, which are now available in low-cost generic versions, and
  • A one-time reduction in Medicare payment levels to skilled nursing facilities

Medicare began paying physicians employed with hospitals more than independent practice physicians due to an arbitrage between Medicare’s Inpatient (Part A) and outpatient (Part B), resulting in hospital outpatient billings among their highest profit centers and incentivizing hospitals to go on a buying binge to purchase doctor practices. This is in addition to the formation of “networks” to take advantage of incentives provided under the ACA.

SK&A highlights the shift of influence in healthcare delivery from 2011 to 2014 in the U.S, as rapidly evolving towards Integrated Health Systems (IHS), causing a dynamic shift in how decisions are made, with more healthcare providers (HCPs) joining large integrated networks, physicians are becoming less influential in purchasing and decision making.

Comparing our tri-state statistics, showing the employment rate of HCPs moving to IHSs from 11/2011 to 3/2014, NJ 16% to 26%, a 63% increase, NY 28% to 38%, a 36% increase and PA 41% to 53%, a 29% increase to an already major transformation.

As we go to the presses, a current report shows that over 1 million Obamacare enrollees received the wrong subsidy, as the purported system for verification of income is flawed, if not, non-existent.

Note: The claw back rule is limited to $2,000 and the only current system for government recovery is when/if the individual has overpaid on his/her taxes.


  • 85% of enrollees are getting aid from the government
  • Average subsidy for exchange enrollees in 2014 is $4,410.
  • 2015-2024, more than $1 trillion will be spent on subsidies

So will the transformation of the private practice physician to hospital based improve our health care delivery system? Will it reduce the cost to the consumer or simply shift the profits from the independent practitioner to the hospitals, networks and/or ACO’s or, will the ACA ultimately increase the cost to employers and employees beyond their capacity to support our current system BEFORE we nationalize!

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