WhatleyKallas Analyzes How the ACA Decision Affects Doctors

        Yesterday, we posted the opinion of the Supreme Court upholding the Affordable Care Act (“ACA” or “PPACA”).   National Federation of Independent Businesses v. Sebelius. No. 11-393.  We also posted our initial analysis of opinion.  In summary, the mandate for health insurance was upheld based on the federal government’s taxation power but not based on the commerce power.  The Court read a limitation into the expanded Medicaid Program, ruling that the federal government cannot disqualify States from the existing Medicaid Program if they do not participate in the expanded Program.  Today, the press contains extensive discussion of the opinion, the legal analysis and the political implications of it, and one can read any newspaper or go on any news website for an extensive discussion of those issues.  In those discussions, one can find every view imaginable including from those who use the term Obamacare and those who call the ACA the clone of Romneycare.  Those discussions are interesting, but we want to address the questions being asked by our clients, doctors and their medical societies: what are the practical implications of the opinion and the full implementation of the Act for providers of healthcare.

  • Most obviously, the mandate and other provisions of the ACA will increase the number of insured people in the country.  That means more paying customers for providers of healthcare and is definitely good news.  It also means that health insurance companies have an ever-growing role in our healthcare system and that continuing our fight against the abuses of the health insurance companies is even more important.  Our firm will continue to fight those abuses.
  • The basic protections for patients, who are consumers of healthcare, remain in place.  Those protections include the prohibition against health insurance companies discriminating based on pre-existing conditions.  While these benefits go directly to patients, they also help providers.  For example, denials based on pre-existing conditions for patients have often resulted in denials of claims by providers, often retrospectively, and even recoupment efforts by health insurance companies.
  • Many of our clients have made innovative efforts to take advantage of the ACA and those efforts will now go forward.  For example, the Connecticut State Medical Society will move forward with the Coop, and we hope others will follow that example.  States that have delayed the development of insurance exchanges should now move forward with them.  Developments like these will add to the competition in the health insurance industry, something that both doctors and consumers need in this country.  As a result of these developments, doctors should find that more of their patients are insured.
  • The Act does not end the fight that doctors have been waging at the Federal Trade Commission and the Department of Justice on antitrust issues.  We must continue to educate and advocate before those regulatory bodies about the issues that doctors face when they are caught between the countervailing powers of highly concentrated insurance companies and highly concentrated hospitals.   
  • The parts of the Act encourage developing methodologies other than fee for service will likely now be implemented more aggressively.  Examples include bundled payments such as for episodes of care and shared payment models. The AMA Practice Management Center has developed an informative resource entitled Evaluating and Negotiating Emerging Payment Options that all doctors in private practice and their practice managers should review.  It can be found at  http://www.ama-assn.org/ama/pub/news/news/2012-02-24-emerging-physician-payment-models.page. The developing payment methodologies present opportunities and dangers for doctors to address that we should closely monitor as they evolve.  For example, physician controlled ACOs can provide opportunities for doctors to increase the portion of the shared savings that they receive.  On the other hand, increased risks from various payment methodologies mean that doctors should proceed with care and with expert advice.
  • The Medicaid aspects of the opinion create a level of uncertainty.  Until 2020, the federal government pays almost all of the costs of the enhanced Medicaid Program.  Some even argue that there is a net saving to States from the enhanced Program.  However, the ruling could result in some States opting out of the enhanced Medicaid Program.  In those States, doctors might find that many lower patients are without any significant coverage.  One could expect those people to continue to seek health care services at Emergency Rooms and clinics devoted to the treatment of those lower people. 
  • The ACA encourages active fraud investigations.  Unfortunately, doctors who are not in any way engaged in fraudulent activity are sometimes the victims of over-zealous bureaucrats and contractors, often operating under contingency fee arrangements.  We must continue the opposition to improper RAC audits and other procedures especially when statistically improper extrapolation methods are used to demand ransoms from doctors.
  • The ACA imposes many new regulatory requirements, including reporting obligations, on States, health insurance companies, and providers of health care.  The most publicized of the requirements relate to the development of health insurance exchanges in each State, which must be done by the end of the year.  Some of the requirements imposed on doctors under the Act and the Regulations implementing it could easily slip up on doctors.  We plan to post some of those deadlines on our website to help our clients avoid missing any of those deadlines through inadvertence. 

We plan to continue to post updates about the ACA and the implications of this important opinion.  In the meanwhile, if you have any general issues that you believe we should address for health care providers, please inform us at This email address is being protected from spambots. You need JavaScript enabled to view it. .