The Patient Protection and Affordable Care Act and Healthcare Finance


In 2010, President Barack Obama signed into law the Affordable Care Act (ACA), which is commonly referred to as Obamacare. What is outlined in this Act has now shaped the lives of millions of American young people positively by making preventive services affordable. The Act has also made it easy to obtain health insurance coverage (Sommers, Buchmueller, Decker, Carey, & Kronick, 2013). When wholly executed, the law is expected to decrease the population of people without insurance covers by over 30 million. This achievement can be made possible by ensuring that American citizens get affordable and comprehensive insurance coverage through traditional employer-sponsored insurance companies and new health insurance marketplaces. Currently, the Affordable Care Act has delayed the surge in healthcare costs and improved the quality of healthcare through pay-for-performance programs, reinforced primary care, care harmonization, and revolutionized Medicare payment reforms (Sommers et al., 2013). The law has put in place arrangements such as authority, financial backing and insurance exchanges. The ACA regulates all insurance firms. It stipulates that every person must have a health cover within the minimum standards and receive the same tariff in spite of antecedent health conditions (medical conditions that kick off before the person’s health insurance goes into effect) or gender. Before the ACA was signed, some insurance firms were unable to ensure people with preexisting medical conditions. The ACA is expected to cut down the costs as well as lay a foundation for affordable and quality medical care for its citizens (Scutchfield & Costich, 2013).

Challenges and Problems Associated with Healthcare Finance

Though the signing of the ACA by President Obama in 2010 was embraced with great jubilation, it was synonymous with releasing a horde of medically covered people into the already constrained and fragile medical delivery system. Expert opinions show the American healthcare sector has had workforce constraints for decades and is not ready to take the expected influx of patients effectively (Scutchfield & Costich, 2013). The training of new medical teams would take a lot of time. However, without additional training, patients would have to wait longer for medical services, have difficulties accessing providers, and spend insufficient time with providers.

Additionally, they would have to bear cost surges and more frustrations with medical care delivery. Overall, the system would be overloaded because the number of those who would want to benefit from these free medical services would rise. Consequently, with the current delivery system and shortages of medical professionals in the United States, the entire movie would have a negative impact on the objectives of legislators who crafted the ACA. In fact, the welfare of healthcare practitioners could be compromised. The ACA, therefore, would increase regulatory burdens, workloads, reduce salaries, introduce new penalties to insurers, contempt personal predilections and principles, and compel employers to provide full coverage for their permanent employees (Moran & Bolton, 2012). All these factors could have negative outcomes on the ACA goals and break President Obama’s promises as stated in the ACA (Kocher, Emanuel, & DeParle, 2010).

Review of the Literature

Obamacare or the Patient Protection and Affordable Care Act is said to be one of the most important American healthcare revolutions. The Law came through the introduction and revision of existing federal government legal structures for the United States healthcare system (Scutchfield & Costich, 2013). The ACA provides universal benefits to U.S. citizens by providing a medical insurance coverage from birth to retirement age. The implementation of the ACA holds numerous promises. For example, it is expected to reduce the number of uninsured U.S. citizens by more than half. Statistics show that the law will raise the number of medically insured people by approximately 94%. This rise implies a reduction in the number of Americans without health insurance by 31 million people and an increase in Medicaid registration by 15 million individuals. It is approximated that only 24 million Americans will remain uninsured (Scutchfield & Costich, 2013).

The formation of the ACA had several public aims. One of the core functions of the ACA was to achieve universal medical insurance coverage through divided responsibilities among the government, individuals and their employers (Moran & Bolton, 2012). The second function was to have an unbiased system of medical insurance coverage where citizens enjoyed fair, quality and affordable medical services. Thirdly, the ACA aimed for better health care values, quality, and efficiency while plummeting uneconomical spending and increasing the healthcare system’s accountability to every patient. The ACA was expected to lead to improved primary health care access and enduring transformation in the availability of prime and preventive healthcare. Finally, the ACA targeted strategic investments through the health sector by extension of clinical preventive care and public investments.

Critical Analysis of the Challenges and Problems of the Affordable Care Act

For the past few years, the ACA has outlived several methodical disasters, one governmental poll that saw the re-election of the head of state that executed the ACA, two trials in the Supreme Court and a couple of repeal efforts in Congress (Ossoff & Thomason, 2013). However, the future of the ACA cannot be promised with certainty (Lokkerbol et al., 2014). Some of the major hurdles that the Act has faced include:

Medicaid Expansion

To implement the ACA in every state of America, experts say that the U.S. needs to expand the state-federal Medicaid programs to cover people with incomes at or slightly above the poverty line (Lokkerbol et al., 2014). According to Kocher, Emanuel, and DeParle (2010), 21 states with Republican governors or GOP-controlled legislatures including Texas and Florida have flinched citing ideological objections, budget constraints, as well as skepticism about Washington’s long-term commitments to pay for most health care costs (Kocher, Emanuel, & DeParle, 2010).

Anemic Enrollment

By 2015, it was approximated that eighteen million Americans who were potential insurance clients had failed to buy insurance policies in federal and state marketplaces. There were objections regarding the buying of the insurances from marketplaces with insurance firms claiming that they faced difficulties enrolling Hispanics, young adults and people with contrary opinions. The cash allocated to the federal government to enroll people was exhausted thereby forcing several states to face harsh penalties.

Market Stability

It was speculated that insurance premiums might increase notwithstanding the efforts by the central regime to cushion insurers from hefty health charges. The standard operating procedure was that insurers met with their new customers in the marketplaces to figure out if their premiums were enough to cover the medical costs (Ghitza & Tai, 2014). However, that trend was to end in the coming days.


Individuals who got their insurance coverage through their employers benefited from the health law. However, the government has included among its policies heavy tax plans from 2018. The Cadillac tax, which is a product of the health decree, will push employers to offer minimal health coverage or transfer the additional expenses related to taxes to their workers. The insurance prices have also kept rising especially for those who needed a lot of care. It is estimated that their cost will rise to $6,850 for individuals and $13.700 for families.

Political Resistance

The Affordable Care Act has faced numerous challenges from the GOP and the Republicans. The Republicans have vowed to bring down the ACA. In 2014, the House of Representatives filed a lawsuit alleging that the president had overstepped his powers by implementing the health law (Lokkerbol et al., 2014). The allegations were used as a stepping ground for the 2016 presidential election campaigns with some political leaders reiterating their urge to repeal the law. Currently, there are doubts whether the ACA will ever prevail if the Republicans capture the White House and Congress in 2016 (Jones, Bradley, & Oberlander, 2014).

Recommended Solutions

As the problems of the Affordable Care Act continue to be rampant, various solutions have been recommended. One argument is that the enactment of the ACA imposes an influx of a high number of medically insured patients into the already constrained healthcare system. The American government has inadequate medical staff, which is likely to lower the quality of healthcare services. One of the recommended solutions to address this problem is the adoption of telemedicine. According to a global study carried out by Cisco on the implementation of telemedicine, 74% of patients were comfortable with in-patient consultations with their health care providers while 70% were comfortable with communicating with their healthcare teams via online services such as emails, text messages, and videos instead of in-office visits. Conversely, 60% of the doctors were ready to embrace online consultation as a means of communing with their clients. These findings were obtained from a nationwide survey in the United States, which involved more than 2,000 primary care physicians (Miller & Sim, 2004).

As the new Affordable Care Act gears toward closing the uninsured gap in America, the coverage does not consider how cost-ineffective the care may be. A recent survey shows that the number of the underinsured population has risen as premiums and deductibles increase. The ACA can be saved from future downfall if it is ready to adopt the willingness of the American people to use telehealth or telemedicine (Miller & Sim, 2004). Another survey on the suitability of telemedicine also shows that it provides desired clinical outcomes for treatment via online means as is the case with in-person treatments. Another important factor to consider is the availability of telemedicine. The service is available throughout the day and night in all regions of the U.S. and at lower and more manageable costs than the conventional in-person treatments (Miller & Sim, 2004).

Another problem that the ACA has encountered is the health insurance exchange, which has played a critical role in the purchase and sales of health insurance. This provision in the ACA failed in 18 states in 2014 and was never executed in 13 other states. The causes of the failure were identified and addressed.

Implementation of the Solutions

Some of the issues raised included how states exchanges should be governed (Oberlander, 2012). The state exchanges operated as either prevailing state unit organizations or self-governing public groups. It was recommended that in each state, the state exchange should be placed under an independent agency as opposed to existing government agencies. Another alternative was to place them under the concerned insurance agency or Medicaid departments since they tended to have diverse needs than those of Medicaid partakers (Berger, 2014). The independent agency should be clearly relieved from operating laws or requirements of the state. Management should not have any political influence but maintain absolute professionalism. The exchanges should subcontract services that already have competitive markets whose performance can be scrutinized easily. Additionally, since state exchanges were a cause for concern, there was a likelihood that individuals wishing to benefit from the ACA would not be evenly distributed among the available health plans within the available exchange. There was a possibility that participants would go for preferred provider organizations (PPOs) with larger networks than health maintenance organizations (HMOs) with limited networks.

Justification of Solutions

Though the ACA prohibits inequality in charging enrollees based on their antecedent health conditions, individual firms have to set their premiums to cater for the extra costs, especially for enrollees with pre-existing medical conditions. Consequently, such a move discourages the healthier participants. With the ACA regulations, all insurers must treat all participants as members of the same risk pool, which is likely to increase the premiums for all plans offered by a particular insurance vendor. To address this problem, the federal government needs to provide regulations that will ensure the uniformity of services offered by all insurers. Additionally, the state should put into place measures that discourage adverse selection against and within the exchange between participating and non-participating insurers (Ghitza & Tai, 2014).


The Patient Protection and Affordable Care Act is a turning point in the American healthcare sector. This law has brought substantial changes to the American public by providing equal preventive services and insurance cover to the poor and the rich as well as the healthy and unhealthy. However, the ACA has faced numerous challenges since its enactment, and if heuristic measures are not taken, the dreams of millions of Americans will die with the regulation.


Berger, S. (2014). Fundamentals of health care financial management: A practical guide to fiscal issues and activities (4th ed.). Hoboken, NJ: John Wiley & Sons.

Ghitza, U. E., & Tai, B. (2014). Challenges and opportunities for integrating preventive substance-use-care services in primary care through the Affordable Care Act. Journal of Health Care for the Poor and Underserved, 25(10), 36.

Jones, D. K., Bradley, K. W., & Oberlander, J. (2014). Pascal’s Wager: Health insurance exchanges, Obamacare, and the Republican dilemma. Journal of Health Politics, Policy and Law, 39(1), 97-137.

Kocher, R., Emanuel, E. J., & DeParle, N. A. M. (2010). The Affordable Care Act and the future of clinical medicine: The opportunities and challenges. Annals of Internal Medicine, 153(8), 536-539.

Lokkerbol, J., Adema, D., Cuijpers, P., Reynolds, C. F., Schulz, R., Weehuizen, R., & Smit, F. (2014). Improving the cost-effectiveness of a healthcare system for depressive disorders by implementing telemedicine: A health economic modeling study. The American Journal of Geriatric Psychiatry, 22(3), 253-262.

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Moran, A. E. & Bolton, R. M. (2012). Important health plan disclosure requirements effective in September 2012 under the PPACA. Employee Relations Law Journal, 38(1), 63-74.

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Ossoff, R. H. & Thomason, C. D. (2013). Welcoming the age of the PPACA. Journal of Healthcare Compliance, 15(2), 45-58.

Scutchfield, F. D., & Costich, J. F. (2013). Law and the public’s health. American Journal of Preventive Medicine, 44(4), 427-428.

Sommers, B. D., Buchmueller, T., Decker, S. L., Carey, C., & Kronick, R. (2013). The Affordable Care Act has led to significant gains in health insurance and access to care for young adults. Health Affairs, 32(1), 165-174.

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