Physicians Opting Out of Obamacare Plans

An estimated 214,524 American physicians will not be participating in ACA (Obamacare) health plans, according to a large 2014 survey of multi-physician medical practices by the Medical Group Management Association (survey summarized here).  Why?

• ACA's payment rates for services rendered are "financially unsustainable" for physicians.  "[W]here private plans pay $1.00 for a service, Medicare pays $0.80, and [Obamacare] plans are now paying about $0.60."
  
• ACA's high deductibles can leave patients owing thousands of dollars to physicians and hospitals for services rendered—money that doctors need to keep their doors open, but may not be able to collect from patients.
  
• ACA's premiums aren't cheap either, and if a patient stops paying the premiums, Obamacare rules give patients a 90-day grace period to get premiums caught up. If the patient doesn't pay up, Obamacare forces the insurance company to pay physicians and hospitals for any services provided day 1 through 30, but not for services provided from day 31 through 90. Doctors and hospitals are simply left holding the bag. 

With the deck stacked against them, doctors are simply avoiding Obamacare plans. As of January 2014, a estimated 70% of California's 104,000 physicians had already said no to participating in Covered California plans.

Why Large Employers Won't Be Hiring

From Paul Mirengoff @ powerlineblog.com:

"...it’s time for a sober look at the costs of [Obama's] signature program. Our friend Tevi Troy, head of the American Health Policy Institute (AHPI), provides that look in a study called “The Cost of the Affordable Care Act to Large Employers.”

The study is based on internal cost data from more than 100 large employers (10,000 or more employees each) doing business in the United States. ...The study’s main findings are that over the next decade:

Obamacare will cost large U.S. employers between $4,800 to $5,900 per employee.

Large employers expect overall Obamacare-related cost increases of between $163 million and $200 million per employer, or an increase of 4.3 percent in 2016 and 8.4 percent in 2023 over and above what they would otherwise be spending.

Based on these data, the total cost of Obamacare to all large U.S. employers will amount to between $151 billion and $186 billion, or 5.9 percent more than what they would otherwise be spending.

Tevi concludes that “these data demonstrate that the added mandates, fees and regulatory burdens associated with the ACA are increasing the cost of employer-sponsored health care plans, with implications for both employers and employees.” I’ll say.

Staffing decisions will, of course, be among the “implications.” If the estimates contained in the AHPI study are even close to accurate, Obamacare will likely prove to be a significant job-killer.

In a related story, Elizabeth Harrington reports @ the Washington Free Beacon:

Health care costs have already been increasing for large businesses, which spend $578.6 billion each year to provide health coverage for 170.9 million employees, retirees, and dependents. However, numerous studies suggest that Obamacare is adding to employers’ burdens.

For instance, a report by the Urban Institute found that Obamacare increased large employer health costs by $11.8 billion in 2012, and the Joint Committee on Taxation estimated that the excise tax on high-cost plans would cost $32 billion from 2018 to 2019.

The novel survey by the American Health Policy Institute asked companies directly what their costs will be, rather than “speculating from the outside.”