Reforming our Healthcare System

I have written several articles on postings related to Reform in America. A list of links have been provided at bottom of this article for your convenience. This article will, however address additional areas rife for reform.

Nine Key Strategies to Achieving 21st Century Personalized Health Care

  1. Create information-rich health savings accounts to encourage and empower the individual.
  2. Create a secure electronic health records with expert systems to maximize accuracy, minimize errors, reduce inefficiencies, and improve care.
  3. Develop a new system of health justice to replace the trial lawyer-driven malpractice litigation, with patient safety as a central component of the new approach.
  4. Create a buyers’ market for pharmaceuticals by building a transparent system for individuals, doctors, and pharmacists of price and efficacy information about prescription and over-the counter drugs. The system would have an open formulary with an “after-pay” rather than a co-pay.
  5. Create a system and culture of rapid adoption of solutions that result in better outcomes at lower cost for both the public and private sector.
  6. Establish an intellectually credible, accurate system for capturing the cost and benefits of better solutions, better technologies, and better outcomes. This will create a technically correct model of return on investment for solutions with better outcomes at lower cost.
  7. Develop a real-time continuous research database.
  8. Combine these electronic systems into an online public health network for health protection against natural outbreaks and a bio-shield against deliberate biological attack.
  9. By implementing the first eight strategies, turn health and health care from a problem into an opportunity, making it the leading creator of high-value jobs and foreign exchange earnings in American society.

Health care reform is for the most part governmental policy that affects health care delivery in a given place. Health care reform typically attempts to:

  • Broaden the population that receives health care coverage through either public sector insurance programs or private sector insurance companies
  • Expand the array of health care providers consumers may choose among
  • Improve the access to health care specialists
  • Improve the quality of health care
  • Give more care to citizens
  • Decrease the cost of health care

United States

In the United States, the debate regarding health care reform includes questions of a right to health care, access, fairness, sustainability, quality and amounts spent by government. The mixed public-private health care system in the United States is the most expensive in the world, with health care costing more per person than in any other nation, and a greater portion of gross domestic product (GDP) is spent on it than in any other United Nations member state except for East Timor.

Hawaii and Massachusetts

Both Hawaii and Massachusetts have implemented some incremental reforms in health care, but neither state has complete coverage of its citizens. For example, data from the Kaiser Family Foundation shows that 5% of Massachusetts and 8% of Hawaii residents are uninsured. To date, The U.S. Uniform Law Commission, sponsored by the National Conference of Commissioners on Uniform State Laws has not submitted a uniform act or model legislation regarding health care insurance or health care reform.

United Kingdom

Healthcare was reformed in 1948 after the Second World War, broadly along the lines of the 1942 Beveridge Report, with the creation of the National Health Service or NHS. It was originally established as part of a wider reform of social services and funded by a system of National Insurance, though receipt of healthcare was never contingent upon making contributions towards the National Insurance Fund. Private health care was not abolished but had to compete with the NHS. About 15% of all spending on health in the UK is still privately funded but this includes the patient contributions towards NHS provided prescription drugs, so private sector healthcare in the UK is quite small. As part of a wider reform of social provision it was originally thought that the focus would be as much about the prevention of ill-health as it was about curing disease. The NHS for example would distribute baby formula milk fortified with vitamins and minerals in an effort to improve the health of children born in the post war years as well as other supplements such as cod liver oil and malt. Many of the common childhood diseases such as measles, mumps, and chicken pox were mostly eradicated with a national program of vaccinations.

The NHS has been through many reforms since 1974. The Conservative Thatcher administrations attempted to bring competition into the NHS by developing a supplier/buyer role between hospitals as suppliers and health authorities as buyers. This necessitated the detailed costing of activities, something which the NHS had never had to do in such detail, and some felt was unnecessary. The Labour Party generally opposed these changes, although after the party became New Labour, the Blair government retained elements of competition and even extended it, allowing private health care providers to bid for NHS work. Some treatment and diagnostic centres are now run by private enterprise and funded under contract. However, the extent of this privatisation of NHS work is still small, though remains controversial. The administration committed more money to the NHS raising it to almost the same level of funding as the European average and as a result, there was large expansion and modernisation programme and waiting times improved.

The government of Gordon Brown proposed new reforms for care in England. One is to take the NHS back more towards health prevention by tackling issues that are known to cause long term ill health. The biggest of these is obesity and related diseases such as diabetes and cardio-vascular disease. The second reform is to make the NHS a more personal service, and it is negotiating with doctors to provide more services at times more convenient to the patient, such as in the evenings and at weekends. This personal service idea would introduce regular health check-ups so that the population is screened more regularly. Doctors will give more advice on ill-health prevention (for example encouraging and assisting patients to control their weight, diet, exercise more, cease smoking etc.) and so tackle problems before they become more serious. Waiting times, which fell considerably under Blair (median wait time is about 6 weeks for elective non-urgent surgery) are also in focus. A target was set from December 2008, to ensure that no person waits longer than 18 weeks from the date that a patient is referred to the hospital to the time of the operation or treatment. This 18-week period thus includes the time to arrange a first appointment, the time for any investigations or tests to determine the cause of the problem and how it should be treated. An NHS Constitution was published which lays out the legal rights of patients as well as promises (not legally enforceable) the NHS strives to keep in England.


Numerous healthcare reforms in Germany were legislative interventions to stabilise the public health insurance since 1983. 9 out of 10 citizens are publicly insured, only 8% privately. Health care in Germany, including its industry and all services, is one of the largest sectors of the German economy. The total expenditure in health economics of Germany was about 287.3 billion euro in 2010, equivalent to 11.6 percent of the gross domestic product (GDP) this year and about 3,510 euro per capita. Direct inpatient and outpatient care equal just about a quarter of the entire expenditure – depending on the perspective. Expenditure on pharmaceutical drugs is almost twice the amount of those for the entire hospital sector. Pharmaceutical drug expenditure grew by an annual average of 4.1% between 2004 and 2010.

These developments have caused numerous healthcare reforms since the 1980s. An actual example of 2010 and 2011: First time since 2004 the drug expenditure fell from 30.2 billion euro in 2010, to 29.1 billion Euro in 2011, i. e. minus 1.1 billion Euro or minus 3.6%. That was caused by restructuring the Social Security Code: manufacturer discount 16% instead of 6%, price moratorium, increasing discount contracts, increasing discount by wholesale trade and pharmacies.

The Netherlands

The Netherlands has introduced a new system of health care insurance based on risk equalization through a risk equalization pool. In this way, a compulsory insurance package is available to all citizens at affordable cost without the need for the insured to be assessed for risk by the insurance company. Furthermore, health insurers are now willing to take on high risk individuals because they receive compensation for the higher risks.

A 2008 article in the journal Health Affairs suggested that the Dutch health system, which combines mandatory universal coverage with competing private health plans, could serve as a model for reform in the US.


Following the collapse of the Soviet Union, Russia embarked on a series of reforms intending to deliver better healthcare by compulsory medical insurance with privately owned providers in addition to the state run institutions. According to the OECD none of 1991-93 reforms worked out as planned and the reforms had in many respects made the system worse. Russia has more physicians, hospitals, and healthcare workers than almost any other country in the world on a per capita basis, but since the collapse of the Soviet Union, the health of the Russian population has declined considerably as a result of social, economic, and lifestyle changes. However, after Putin became president in 2000 there was significant growth in spending for public healthcare and in 2006 it exceed the pre-1991 level in real terms. Also life expectancy increased from 1991-93 levels, infant mortality rate dropped from 18.1 in 1995 to 8.4 in 2008. Russian Prime Minister Vladimir Putin announced a large-scale health care reform in 2011 and pledged to allocate more than 300 billion rubles ($10 billion) in the next few years to improve health care in the country.


Taiwan changed its healthcare system in 1995 to a National Health Insurance model similar to the US Medicare system for seniors. As a result, the 40% of Taiwanese people who had previously been uninsured are now covered. It is said to deliver universal coverage with free choice of doctors and hospitals and no waiting lists. Polls in 2005 are reported to have shown that 72.5% of Taiwanese are happy with the system, and when they are unhappy, it’s with the cost of premiums (equivalent to less than US$20 a month).

Employers and the self-employed are legally bound to pay National Health Insurance (NHI) premiums which are similar to social security contributions in other countries. However, the NHI is a pay-as-you-go system. The aim is for the premium income to pay costs. The system is also subsidized by a tobacco tax surcharge and contributions from the national lottery.


As evidenced by the large variety of different healthcare systems seen across the world, there are several different pathways that a country could take when thinking about reform. In comparison to the UK, physicians in Germany have more bargaining power through professional organizations (i.e., physician associations); this ability to negotiate affects reform efforts. Germany makes use of sickness funds, which citizens are obliged to join but are able to opt out if they have a very high income. The Netherlands used a similar system but the financial threshold for opting out was lower. The Swiss, on the other hand use more of a privately based health insurance system where citizens are risk-rated by age and sex, among other factors. The United States government provides healthcare to just over 25% of its citizens through various agencies, but otherwise does not employ a system. Healthcare is generally centered around regulated private insurance methods.

One key component to healthcare reform is the reduction of healthcare fraud and abuse. In the U.S. and the EU, it is estimated that as much as 10 percent of all healthcare transactions and expenditures may be fraudulent.

“Control knobs” theory

The five control knobs for health-sector reform

In “Getting Health Reform Right: A Guide to Improving Performance and Equity,” Marc Roberts, William Hsiao, Peter Berman, and Michael Reich of the Harvard T.H. Chan School of Public Health aim to provide decision-makers with tools and frameworks for health care system reform. They propose five “control knobs” of health reform: financing, payment, organization, regulation, and behavior. These control knobs refer to the “mechanisms and processes that reformers can adjust to improve system performance”. The authors selected these control knobs as representative of the most important factors upon which a policymaker can act to determine health system outcomes.

Their method emphasizes the importance of “identifying goals explicitly, diagnosing causes of poor performance systematically, and devising reforms that will produce real changes in performance”. The authors view health care systems as a means to an end. Accordingly, the authors advocate for three intrinsic performance goals of the health system that can be adjusted through the control knobs. These goals include:

  1. Health status: This goal refers to the overall health of the target population, assessed by metrics such as life expectancy, disease burden, and/or the distribution of these across population subgroups.
  2. Customer satisfaction: This goal is concerned with the degree of satisfaction that the health care system produces among the target population.
  3. Financial risk protection: This goal refers to the health system’s ability to protect the target population from the financial burden of poor health or disease.

The authors also propose three intermediate performance measures, which are useful in determining the performance of system goals, but are not final objectives. These include:

  1. Efficiency:
    1. Technical efficiency: maximum output per unit cost
    2. Allocative efficiency: a given budget maximises health system user satisfaction or other defined goals
  2. Access: effective availability by which patients receive care
  3. Quality of care: consideration of both the average quality and distribution of quality

While final performance goals are largely agreed upon, other frameworks suggest alternative intermediate goals to those mentioned here, such as equity, productivity, safety, innovation, and choice.

FrameworkIntermediate Goals
Control knobs frameworkEfficiency
Framework for assessing behavioural healthcareEffectiveness
EGIPSS modelProductivity
Volume of care and services
Quality of care and services
WHO Performance frameworkAccess
Commonwealth Fund frameworkHigh-quality care
Efficient care
System and workforce innovation and improvement
WHO Building Blocks FrameworkAccess
Systems ThinkingEquity

The five proposed control knobs represent the mechanisms and processes that policy-makers can use to design effective health care reforms. These control knobs are not only the most important elements of a healthcare system, but they also represent the aspect that can be deliberately adjusted by reforms to affect change. The five control knobs are:

  1. Financing, which encompasses all the mechanisms and activities designed to raise money for the health system. With respect to mechanisms, the financing knob includes health-related taxes, insurance premiums and out-of-pocket expenses among others. Activities refers to the institutional organization that collects and distributes finance to participants in the health sector. In other words, financing is about the resources available to the healthcare system, who controls them and who receives them. The financing knob has clear implications for the health status of the population and particular groups in it, as well as the access to health care and protection from financial risk that these groups, and the population as a whole, have. The financing knob involves numerous potential financing mechanisms and processes that should be selected in accordance with a country’s social values and politics.
  2. Payment refers to the mechanisms and processes through which the health system or patients distribute payments to providers, including fees, capitation and budgets on the part of the government and fees paid by patients. Payment is about the distribution of available resources to the providers of health services. Health care reform can implement a variety of incentive schemes for both providers and patients in a way to optimize limited resources.
  3. Organization of the health system refers to the structure of providers, their roles, activities and operations. Essentially, organization describes how the health care market is set up: who are the providers, who are the consumers, who are the competitors, and who runs them. Changes in the organization of a healthcare system happen at multiple levels at both the front-line and managerial level.
  4. Regulation refers to actions at the state level that modify or alter the behavior of various actors within the health care system. The actors may include health care providers, medical associations, individual consumers, insurance agents, and more. Regulations are only effective when enforced, therefore laws that are “on the books” but are not implemented in practice have little effect on the system as a whole.
  5. Behavior of healthcare actors includes actions of both providers (e.g., doctors’ behavior) and patients (e.g., anti-smoking campaigns) and involves “changing individual behavior through population-based interventions”. Healthcare reform with respect to behavior revolves around the behaviors that can be used to improve the outcomes and performance of the health care system. These behaviors include health-seeking behavior, professional/doctors’ behavior, treatment compliance, and lifestyle and prevention behaviors.

The five control knobs of health care reform are not designed to work in isolation; health care reform may require the adjustment of more than one knob or of multiple knobs simultaneously. Further, there is no agreed-upon order of turning control knobs to achieve specific reforms or outcomes. Health care reform varies by setting and reforms from one context may not necessarily apply in another. It is important to note that the knobs interact with cultural and structural factors that are not illustrated within this framework, but which have an important effect on health care reform in a given context.

In summary, the authors of “Getting Health Reform Right: A Guide to Improving Performance and Equity” propose a framework for assessing health systems that guides decision-makers’ understanding of the reform process. Rather than a prescriptive proposal of recommendations, the framework allows users to adapt their analysis and actions based on cultural context and relevance of interventions. As noted above, many frameworks for health care reform exist in the literature. Using a comprehensive yet responsive approach such as the control knobs framework proposed by Roberts, Hsiao, Berman, and Reich allows decision-makers to more precisely determine the “mechanisms and processes” that can be changed in order to achieve improved health status, customer satisfaction, and financial risk protection.

Explaining Health Care Reform: Questions About Health Insurance Subsidies

Health insurance is expensive and can be hard to afford for people with lower or moderate income, particularly if they are not offered health benefits at work. In response, the Affordable Care Act (ACA) provides for sliding-scale subsidies to lower premiums and out-of-pocket (OOP) costs for eligible individuals.

This brief provides an overview of the financial assistance provided under the ACA for people purchasing coverage on their own through health insurance Marketplaces (also called exchanges).

Health Insurance Marketplace Subsidies

There are two types of subsidies available to marketplace enrollees. The first type, called the premium tax credit, works to reduce enrollees’ monthly payments for insurance coverage. The second type of financial assistance, the cost sharing subsidy, is designed to minimize enrollees’ out-of-pocket costs when they go to the doctor or have a hospital stay. In order to receive either type of financial assistance, qualifying individuals and families must enroll in a plan offered through a health insurance Marketplace.


The premium tax credit reduces enrollees’ monthly payments for insurance plans purchased through the Marketplace. Marketplace plans are offered in four “metal” levels of coverage: bronze, silver, gold, and platinum. Bronze plans tend to have the lowest premiums but have the highest deductibles and other cost sharing, leaving the enrollee to pay more out-of-pocket when they receive covered health care services, while platinum plans have the highest premiums but very low out-of-pocket costs. The premium tax credit can be applied to plans in any of these metal levels. Also offered on the Marketplace are Catastrophic health plans with even lower premiums and higher cost sharing compared to bronze plans. Catastrophic plans are generally only available to individuals younger than 30, and premium tax credits cannot be applied to these plans.

Who is eligible for the premium tax credit?

In order to receive the premium tax credit for coverage starting in 2022, a marketplace enrollee must meet the following criteria:

  • Have a household income at least equal to the Federal Poverty Level (FPL), which for the 2022 benefit year will be determined based on 2021 poverty guidelines: (Table 1)
  • Not have access to affordable coverage through an employer (including a family member’s employer)
  • Not be eligible for coverage through Medicare, Medicaid, the Children’s Health Insurance Program (CHIP), or other forms of public assistance
  • Have U.S. citizenship or proof of legal residency (Lawfully present immigrants whose household income is below 100% FPL can also be eligible for tax subsidies through the Marketplace if they meet all other eligibility requirements.)
  • If married, must file taxes jointly in order to qualify

For the purposes of the premium tax credit, household income is defined as the Modified Adjusted Gross Income (MAGI) of the taxpayer, spouse, and dependents. The MAGI calculation includes income sources such as wages, salary, foreign income, interest, dividends, and Social Security.

Employer coverage is considered affordable if the employee’s contribution – for self-only coverage, not including the cost of adding family members –  is less than 9.61 percent of household income. Under this rule, if an employer covers 100% of the cost of self-only coverage for its workers but nothing toward the cost of family coverage, the offer of employer coverage would still be considered affordable, meaning that family members would nonetheless be ineligible for marketplace subsidies. This anomaly is sometimes referred to as the “family glitch.”

The employer’s coverage must also meet the minimum value standard, meaning that the plan has an actuarial value of at least 60 percent (equivalent to a bronze plan), with an annual OOP limit on cost sharing of no more than $8,700/$17,400 in 2021. Minimum value plans must also provide substantial coverage for hospitalization and physician care. People who are offered employer-sponsored coverage that fails to meet one or both of these requirements can qualify for Marketplace subsidies if they meet the other criteria listed above.

In states that have expanded Medicaid under the ACA, adults with income up to 138% FPL are generally eligible for Medicaid and so ineligible for Marketplace subsidies. In the 12 states that have not adopted the Medicaid expansion, adults with income as low as 100% FPL can qualify for Marketplace subsidies, but those with lower incomes are not eligible for tax credits and generally not eligible for Medicaid unless they meet other state eligibility criteria. KFF estimates that 2.2 million Americans living in non-expansion states fall into this coverage gap.

An exception to the rule restricting tax credit eligibility for adults with income below the poverty level is made for certain lawfully present immigrants. Other federal rules restrict Medicaid eligibility for lawfully present immigrants, other than pregnant women, until they have resided in the U.S. for at least five years.   Immigrants who would otherwise be eligible for Medicaid but have not yet completed their five-year waiting period may instead qualify for tax credits through the Marketplace. If an individual in this circumstance has an income below 100 percent of poverty, for the purposes of tax credit eligibility, his or her income will be treated as though it is equal to the poverty level. Immigrants who are not lawfully present are ineligible to enroll in health insurance through the marketplace, receive tax credits through the marketplaces, or enroll in non-emergency Medicaid and CHIP.

What amount of premium tax credit is available to people?

The premium tax credit works by limiting the amount an individual must contribute toward the premium for the “benchmark” plan – or the second-lowest cost silver plan available to the individual in their Marketplace. This “required individual contribution” is set on a sliding income scale. In 2022, for individuals with income up to 150% FPL, the required contribution is zero, while at an income of 400% FPL or above, the required contribution is 8.5% of household income (Table 2).

These amounts were set by the American Rescue Plan Act (ARPA) and they are in effect temporarily, just for the 2021 and 2022 coverage years. Prior to ARPA, the required contribution percentages for the 2020 plan year ranged from 2.06% of household income for people with income between 100% and 133% FPL to 9.78% of income for people with income from 300% to 400% FPL. In addition, prior to ARPA, people with income above 400% FPL were not eligible for premium tax credits. Congress is debating extension of the ARPA subsidy changes for future years.

The amount of tax credit is calculated by subtracting the individual’s required contribution from the actual cost of the “benchmark” plan. So, for example, if the benchmark plan costs $6,000 annually, the required contribution for someone with an income of 150% FPL is zero, resulting in a premium tax credit of $6,000;   if that same person’s income equals 250% FPL, the individual contribution is 4% of $32,200, or $1,288, resulting in a premium tax credit of $4,712.

The premium tax credit can then be applied toward any other plan sold through the Marketplace (with the exception of catastrophic coverage). The amount of the tax credit remains the same, so a person who chooses to purchase a plan that is more expensive than the benchmark plan will have to pay the difference in cost. Conversely, if a person chooses a less expensive plan, such as the lowest-cost silver plan or a bronze plan, the tax credit will cover a greater share of that plan’s premium, and possibly even cover the entire cost, leaving the consumer with a zero-premium plan. (When the tax credit exceeds the cost of a plan, it lowers the premium to zero and any remaining tax credit amount is unused.) Figure 1 shows an example of how premium tax credits would work for a 45-year-old individual with a 2022 income equal to 250% of FPL. The example assumes the unsubsidized benchmark plan premium for someone this age would be $6,000 annually, while unsubsidized premiums for the lowest cost bronze, lowest cost silver, and lowest cost gold plans for this person would be $4,500, $5,500, and $6,800, respectively.

For certain components of a marketplace plan premium, the premium tax credit will not apply. First, the tax credit cannot be applied to the portion of a person’s premium attributable to covered benefits that are not essential health benefits (EHB). For example, a plan may offer adult dental benefits, which are not included in the definition of EHB. In that case, the person would have to pay the portion of the premium attributable to adult dental benefits without financial assistance. In addition, the ACA requires that premium tax credits may not be applied to the portion of premium attributable to “non-Hyde” abortion benefits. Marketplace plans that cover abortion are required to charge a separate $1 monthly premium to cover the cost of this benefit; although insurers can itemize the $1 charge on a single monthly bill and collect what enrollees owe monthly, including for the $1 charge, in a single transaction. Finally, if the person smokes cigarettes and is charged a higher premium for smoking, the premium tax credit is not applied to the portion of the premium that is the tobacco surcharge.

How will premium tax credit be provided?

To receive the premium tax credit, people must apply for coverage through the Marketplace and in their application, provide information about their age, address, household size, citizenship status, and estimated income for the coming year. Immediately after submitting the application, people will receive a determination letting them know the amount of premium tax credit for which they qualify. The consumer then has the option to have the tax credit paid in advance, claim it later when they file their tax return, or some combination of the two options.

The advanced premium tax credit (APTC) option allows consumers to have 1/12 of their tax credit paid directly to their marketplace plan insurer each month, reducing the monthly amount the consumer owes.  However, because the APTC eligibility determination is based on estimated income, the enrollee is required to reconcile their APTC at tax time the following year, once they know what their actual income was. (For people receiving an advanced payment of the premium tax credit in 2021, the reconciliation would occur when they file their 2021 tax return in 2022). If the consumer overestimated their income when they applied, they can receive the unclaimed premium tax credit for which they were eligible as a refundable tax credit when they file. If the consumer underestimated their income at the time of application and excess APTC was paid on their behalf during the year, they would have to repay some or all of the excess tax credit when they file. There are maximum repayment limits which vary depending on income, shown in Table 3.

Alternatively, people can opt to pay their entire premium costs each month and wait to receive their tax credit until they file their annual income tax return the following year, although most marketplace participants cannot afford this option. The premium tax credit is refundable, meaning it is available to qualifying enrollees regardless of whether they have federal income tax liability. Everyone who receives APTC in a tax year is required to file a tax return for that year in order to continue receiving financial assistance in the future.

Cost Sharing Subsidies

The second form of financial assistance available to Marketplace enrollees is a cost sharing subsidy. Cost sharing subsidies reduce enrollees’ out-of-pocket cost due to deductibles, copayments, and coinsurance when they use covered health care services.

Who is eligible for the cost sharing subsidy?

People who are eligible to receive a premium tax credit and have household incomes from 100% to 250% of poverty are eligible for cost sharing subsidies.

How are cost sharing subsidies provided?

Unlike the premium tax credit (which can be applied toward any metal level of coverage), cost sharing subsidies are only offered through silver plans. For eligible individuals, cost sharing reductions (CSR) are applied to a silver plan, essentially making deductibles and other cost sharing under that plan more similar to that under a gold or platinum plan.  Individuals with income between 100% and 250% FPL can continue to apply their premium tax credit to any metal level plan, but they can only receive the cost sharing subsidies if they pick a silver-level plan.

What amount of cost sharing subsidies are available to people?

Cost sharing subsidies are determined on a sliding scale based on income. The most generous cost sharing subsidies are available for people with income up to 150% FPL. For them silver plans that would otherwise have an actuarial value of 70% (meaning the plan would have very high deductibles) are modified to have an actuarial value of 94%. This level of cost sharing reduction plan (sometimes called CSR 94 plans) is similar to a platinum plan, and otherwise, applicable silver plan deductibles, copays, and other cost sharing are substantially reduced. Somewhat less generous cost sharing subsidies are available for people with income of 151% FPL up to 200% FPL that increase the silver plan actuarial value to 87% (CSR 87 plans), with cost sharing more similar to that under a gold plan. And for people with income of 200% up to 250% FPL, modest cost sharing reductions are available to increase the silver plan actuarial value to 73% (CSR 73 plans) and to reduce deductibles and other cost sharing below levels otherwise applicable under a normal silver plan.

Insurers have flexibility in how they set deductibles and copays to achieve the actuarial value under marketplace plans, including CSR plans. On average, in 2021 federal marketplace plans, annual deductibles in CSR94 plans were $177, compared to $4,816 in a normal Silver plan, while average annual deductible in CSR87 and CSR73 plans were $800 and $3,835, respectively.

The ACA also requires maximum annual out-of-pocket spending limits on cost sharing under marketplace plans, with reduced limits for CSR plans. In 2023, the maximum OOP limit will be $8,700 ($17,400 family) for all QHPs; with lower maximum OOP amounts permitted under cost sharing reduction plans. (Table 4)


Subsidies to make insurance more affordable and increase insurance coverage are a key element of the Affordable Care Act. Premium and cost sharing subsidies of varying levels are available to individuals and families with low to moderate incomes, to make coverage and care more affordable.

Beginning in 2021, the ARPA temporarily increased marketplace premium tax credit amounts and extended eligibility for premium tax credits. As a result of these changes, marketplace participants with the lowest incomes (up to 150% FPL) are now eligible for zero-premium silver plans with cost sharing subsidies that also reduce their out-of-pocket cost for covered benefits. The ARPA subsidies first became available to consumers during a pandemic-related special enrollment opportunity in 2021, and more than 2.8 million individuals signed up for new health insurance coverage during that time. Even so, KFF estimates millions more uninsured individuals are eligible for marketplace financial assistance but not enrolled. As the public learns more about more affordable coverage options in the marketplace, it is possible that even greater numbers can enroll in plans with both monthly premiums and deductibles that they find affordable.

United States Health Care Reform Progress to Date and Next Steps


The Affordable Care Act is the most important health care legislation enacted in the United States since the creation of Medicare and Medicaid in 1965. The law implemented comprehensive reforms designed to improve the accessibility, affordability, and quality of health care.


To review the factors influencing the decision to pursue health reform, summarize evidence on the effects of the law to date, recommend actions that could improve the health care system, and identify general lessons for public policy from the Affordable Care Act.


Analysis of publicly available data, data obtained from government agencies, and published research findings. The period examined extends from 1963 to early 2016.


The Affordable Care Act has made significant progress toward solving long-standing challenges facing the US health care system related to access, affordability, and quality of care. Since the Affordable Care Act became law, the uninsured rate has declined by 43%, from 16.0% in 2010 to 9.1% in 2015, primarily because of the law’s reforms. Research has documented accompanying improvements in access to care (for example, an estimated reduction in the share of nonelderly adults unable to afford care of 5.5 percentage points), financial security (for example, an estimated reduction in debts sent to collection of $600–$1000 per person gaining Medicaid coverage), and health (for example, an estimated reduction in the share of nonelderly adults reporting fair or poor health of 3.4 percentage points). The law has also begun the process of transforming health care payment systems, with an estimated 30% of traditional Medicare payments now flowing through alternative payment models like bundled payments or accountable care organizations. These and related reforms have contributed to a sustained period of slow growth in per-enrollee health care spending and improvements in health care quality. Despite this progress, major opportunities to improve the health care system remain.


Policy makers should build on progress made by the Affordable Care Act by continuing to implement the Health Insurance Marketplaces and delivery system reform, increasing federal financial assistance for Marketplace enrollees, introducing a public plan option in areas lacking individual market competition, and taking actions to reduce prescription drug costs. Although partisanship and special interest opposition remain, experience with the Affordable Care Act demonstrates that positive change is achievable on some of the nation’s most complex challenges.

Health care costs affect the economy, the federal budget, and virtually every American family’s financial well-being. Health insurance enables children to excel at school, adults to work more productively, and Americans of all ages to live longer, healthier lives. When I took office, health care costs had risen rapidly for decades, and tens of millions of Americans were uninsured. Regardless of the political difficulties, I concluded comprehensive reform was necessary.

The result of that effort, the Affordable Care Act (ACA), has made substantial progress in addressing these challenges. Americans can now count on access to health coverage throughout their lives, and the federal government has an array of tools to bring the rise of health care costs under control. However, the work toward a high-quality, affordable, accessible health care system is not over.

In this Special Communication, I assess the progress the ACA has made toward improving the US health care system and discuss how policy makers can build on that progress in the years ahead. I close with reflections on what my administration’s experience with the ACA can teach about the potential for positive change in health policy in particular and public policy generally.

Impetus for Health Reform

In my first days in office, I confronted an array of immediate challenges associated with the Great Recession. I also had to deal with one of the nation’s most intractable and long-standing problems, a health care system that fell far short of its potential. In 2008, the United States devoted 16% of the economy to health care, an increase of almost one-quarter since 1998 (when 13% of the economy was spent on health care), yet much of that spending did not translate into better outcomes for patients. The health care system also fell short on quality of care, too often failing to keep patients safe, waiting to treat patients when they were sick rather than focusing on keeping them healthy, and delivering fragmented, poorly coordinated care.

Moreover, the US system left more than 1 in 7 Americans without health insurance coverage in 2008.7 Despite successful efforts in the 1980s and 1990s to expand coverage for specific populations, like children, the United States had not seen a large, sustained reduction in the uninsured rate since Medicare and Medicaid began (Figure ). The United States’ high uninsured rate had negative consequences for uninsured Americans, who experienced greater financial insecurity, barriers to care, and odds of poor health and preventable death; for the health care system, which was burdened with billions of dollars in uncompensated care; and for the US economy, which suffered, for example, because workers were concerned about joining the ranks of the uninsured if they sought additional education or started a business. Beyond these statistics were the countless, heartbreaking stories of Americans who struggled to access care because of a broken health insurance system. These included people like Natoma Canfield, who had overcome cancer once but had to discontinue her coverage due to rapidly escalating premiums and found herself facing a new cancer diagnosis uninsured.

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Figure 1.

Percentage of Individuals in the United States Without Health Insurance, 1963–2015

Data are derived from the National Health Interview Survey and, for years prior to 1982, supplementary information from other survey sources and administrative records. The methods used to construct a comparable series spanning the entire period build on those in Cohen et al and Cohen and are described in detail in Council of Economic Advisers 2014. For years 1989 and later, data are annual. For prior years, data are generally but not always biannual. ACA indicates Affordable Care Act.

In 2009, during my first month in office, I extended the Children’s Health Insurance Program and soon thereafter signed the American Recovery and Reinvestment Act, which included temporary support to sustain Medicaid coverage as well as investments in health information technology, prevention, and health research to improve the system in the long run. In the summer of 2009, I signed the Tobacco Control Act, which has contributed to a rapid decline in the rate of smoking among teens, from 19.5% in 2009 to 10.8% in 2015, with substantial declines among adults as well.

Beyond these initial actions, I decided to prioritize comprehensive health reform not only because of the gravity of these challenges but also because of the possibility for progress. Massachusetts had recently implemented bipartisan legislation to expand health insurance coverage to all its residents. Leaders in Congress had recognized that expanding coverage, reducing the level and growth of health care costs, and improving quality was an urgent national priority. At the same time, a broad array of health care organizations and professionals, business leaders, consumer groups, and others agreed that the time had come to press ahead with reform. Those elements contributed to my decision, along with my deeply held belief that health care is not a privilege for a few, but a right for all. After a long debate with well-documented twists and turns, I signed the ACA on March 23, 2010.

Progress Under the ACA

The years following the ACA’s passage included intense implementation efforts, changes in direction because of actions in Congress and the courts, and new opportunities such as the bipartisan passage of the Medicare Access and CHIP Reauthorization Act (MACRA) in 2015. Rather than detail every development in the intervening years, I provide an overall assessment of how the health care system has changed between the ACA’s passage and today.

The evidence underlying this assessment was obtained from several sources. To assess trends in insurance coverage, this analysis relies on publicly available government and private survey data, as well as previously published analyses of survey and administrative data. To assess trends in health care costs and quality, this analysis relies on publicly available government estimates and projections of health care spending; publicly available government and private survey data; data on hospital readmission rates provided by the Centers for Medicare & Medicaid Services; and previously published analyses of survey, administrative, and clinical data. The dates of the data used in this assessment range from 1963 to early 2016.

Expanding and Improving Coverage

The ACA has succeeded in sharply increasing insurance coverage. Since the ACA became law, the uninsured rate has declined by 43%, from 16.0% in 2010 to 9.1% in 2015, with most of that decline occurring after the law’s main coverage provisions took effect in 2014 (Figure 1). The number of uninsured individuals in the United States has declined from 49 million in 2010 to 29 million in 2015. This is by far the largest decline in the uninsured rate since the creation of Medicare and Medicaid 5 decades ago. Recent analyses have concluded these gains are primarily because of the ACA, rather than other factors such as the ongoing economic recovery. Adjusting for economic and demographic changes and other underlying trends, the Department of Health and Human Services estimated that 20 million more people had health insurance in early 2016 because of the law.

Each of the law’s major coverage provisions—comprehensive reforms in the health insurance market combined with financial assistance for low- and moderate-income individuals to purchase coverage, generous federal support for states that expand their Medicaid programs to cover more low-income adults, and improvements in existing insurance coverage—has contributed to these gains. States that decided to expand their Medicaid programs saw larger reductions in their uninsured rates from 2013 to 2015, especially when those states had large uninsured populations to start with (Figure 2). However, even states that have not adopted Medicaid expansion have seen substantial reductions in their uninsured rates, indicating that the ACA’s other reforms are increasing insurance coverage. The law’s provision allowing young adults to stay on a parent’s plan until age 26 years has also played a contributing role, covering an estimated 2.3 million people after it took effect in late 2010.

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Figure 2.

Decline in Adult Uninsured Rate From 2013 to 2015 vs 2013 Uninsured Rate by State

Data are derived from the Gallup-Healthways Well-Being Index as reported by Witters and reflect uninsured rates for individuals 18 years or older. Dashed lines reflect the result of an ordinary least squares regression relating the change in the uninsured rate from 2013 to 2015 to the level of the uninsured rate in 2013, run separately for each group of states. The 29 states in which expanded coverage took effect before the end of 2015 were categorized as Medicaid expansion states, and the remaining 21 states were categorized as Medicaid nonexpansion states.

Early evidence indicates that expanded coverage is improving access to treatment, financial security, and health for the newly insured. Following the expansion through early 2015, nonelderly adults experienced substantial improvements in the share of individuals who have a personal physician (increase of 3.5 percentage points) and easy access to medicine (increase of 2.4 percentage points) and substantial decreases in the share who are unable to afford care (decrease of 5.5 percentage points) and reporting fair or poor health (decrease of 3.4 percentage points) relative to the pre-ACA trend. Similarly, research has found that Medicaid expansion improves the financial security of the newly insured (for example, by reducing the amount of debt sent to a collection agency by an estimated $600–$1000 per person gaining Medicaid coverage). Greater insurance coverage appears to have been achieved without negative effects on the labor market, despite widespread predictions that the law would be a “job killer.” Private-sector employment has increased in every month since the ACA became law, and rigorous comparisons of Medicaid expansion and nonexpansion states show no negative effects on employment in expansion states.

The law has also greatly improved health insurance coverage for people who already had it. Coverage offered on the individual market or to small businesses must now include a core set of health care services, including maternity care and treatment for mental health and substance use disorders, services that were sometimes not covered at all previously. Most private insurance plans must now cover recommended preventive services without cost-sharing, an important step in light of evidence demonstrating that many preventive services were underused. This includes women’s preventive services, which has guaranteed an estimated 55.6 million women coverage of services such as contraceptive coverage and screening and counseling for domestic and interpersonal violence. In addition, families now have far better protection against catastrophic costs related to health care. Lifetime limits on coverage are now illegal and annual limits typically are as well. Instead, most plans must cap enrollees’ annual out-of-pocket spending, a provision that has helped substantially reduce the share of people with employer-provided coverage lacking real protection against catastrophic costs (Figure 3). The law is also phasing out the Medicare Part D coverage gap. Since 2010, more than 10 million Medicare beneficiaries have saved more than $20 billion as a result.

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Figure 3.

Percentage of Workers With Employer-Based Single Coverage Without an Annual Limit on Out-of-pocket Spending

Data from the Kaiser Family Foundation/Health Research and Education Trust Employer Health Benefits Survey.

Reforming the Health Care Delivery System

Before the ACA, the health care system was dominated by “fee-for-service” payment systems, which often penalized health care organizations and health care professionals who find ways to deliver care more efficiently, while failing to reward those who improve the quality of care. The ACA has changed the health care payment system in several important ways. The law modified rates paid to many that provide Medicare services and Medicare Advantage plans to better align them with the actual costs of providing care. Research on how past changes in Medicare payment rates have affected private payment rates implies that these changes in Medicare payment policy are helping decrease prices in the private sector as well. The ACA also included numerous policies to detect and prevent health care fraud, including increased scrutiny prior to enrollment in Medicare and Medicaid for health care entities that pose a high risk of fraud, stronger penalties for crimes involving losses in excess of $1 million, and additional funding for antifraud efforts. The ACA has also widely deployed “value-based payment” systems in Medicare that tie fee-for-service payments to the quality and efficiency of the care delivered by health care organizations and health care professionals. In parallel with these efforts, my administration has worked to foster a more competitive market by increasing transparency around the prices charged and the quality of care delivered.

Most importantly over the long run, the ACA is moving the health care system toward “alternative payment models” that hold health care entities accountable for outcomes. These models include bundled payment models that make a single payment for all of the services provided during a clinical episode and population-based models like accountable care organizations (ACOs) that base payment on the results health care organizations and health care professionals achieve for all of their patients’ care. The law created the Center for Medicare and Medicaid Innovation (CMMI) to test alternative payment models and bring them to scale if they are successful, as well as a permanent ACO program in Medicare. Today, an estimated 30% of traditional Medicare payments flow through alternative payment models that broaden the focus of payment beyond individual services or a particular entity, up from essentially none in 2010. These models are also spreading rapidly in the private sector, and their spread will likely be accelerated by the physician payment reforms in MACRA.

Trends in health care costs and quality under the ACA have been promising (Figure 4). From 2010 through 2014, mean annual growth in real per-enrollee Medicare spending has actually been negative, down from a mean of 4.7% per year from 2000 through 2005 and 2.4% per year from 2006 to 2010 (growth from 2005 to 2006 is omitted to avoid including the rapid growth associated with the creation of Medicare Part D). Similarly, mean real perenrollee growth in private insurance spending has been 1.1% per year since 2010, compared with a mean of 6.5% from 2000 through 2005 and 3.4% from 2005 to 2010.

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Figure 4.

Rate of Change in Real per-Enrollee Spending by Payer

Data are derived from the National Health Expenditure Accounts.1 Inflation adjustments use the Gross Domestic Product Price Index reported in the National Income and Product Accounts. The mean growth rate for Medicare spending reported for 2005 through 2010 omits growth from 2005 to 2006 to exclude the effect of the creation of Medicare Part D.

As a result, health care spending is likely to be far lower than expected. For example, relative to the projections the Congressional Budget Office (CBO) issued just before I took office, CBO now projects Medicare to spend 20%, or about $160 billion, less in 2019 alone. The implications for families’ budgets of slower growth in premiums have been equally striking. Had premiums increased since 2010 at the same mean rate as the preceding decade, the mean family premium for employer-based coverage would have been almost $2600 higher in 2015. Employees receive much of those savings through lower premium costs, and economists generally agree that those employees will receive the remainder as higher wages in the long run. Furthermore, while deductibles have increased in recent years, they have increased no faster than in the years preceding 2010. Multiple sources also indicate that the overall share of health care costs that enrollees in employer coverage pay out of pocket has been close to flat since 2010 (Figure 5), most likely because the continued increase in deductibles has been canceled out by a decline in co-payments.

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Figure 5.

Out-of-pocket Spending as a Percentage of Total Health Care Spending for Individuals Enrolled in Employer-Based Coverage

Data for the series labeled Medical Expenditure Panel Survey (MEPS) were derived from MEPS Household Component and reflect the ratio of out-of-pocket expenditures to total expenditures for nonelderly individuals reporting full-year employer coverage. Data for the series labeled Health Care Cost Institute (HCCI) were derived from the analysis of the HCCI claims database reported in Herrera et al, HCCI 2015, and HCCI 2015; to capture data revisions, the most recent value reported for each year was used. Data for the series labeled Claxton et al were derived from the analyses of the Trueven Marketscan claims database reported by Claxton et al 2016.

At the same time, the United States has seen important improvements in the quality of care. The rate of hospital-acquired conditions (such as adverse drug events, infections, and pressure ulcers) has declined by 17%, from 145 per 1000 discharges in 2010 to 121 per 1000 discharges in 2014. Using prior research on the relationship between hospital-acquired conditions and mortality, the Agency for Healthcare Research and Quality has estimated that this decline in the rate of hospital-acquired conditions has prevented a cumulative 87 000 deaths over 4 years. The rate at which Medicare patients are readmitted to the hospital within 30 days after discharge has also decreased sharply, from a mean of 19.1% during 2010 to a mean of 17.8% during 2015 (Figure 6; written communication; March 2016; Office of Enterprise Data and Analytics, Centers for Medicare & Medicaid Services). The Department of Health and Human Services has estimated that lower hospital readmission rates resulted in 565 000 fewer total readmissions from April 2010 through May 2015.

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Figure 6.

Medicare 30-Day, All-Condition Hospital Readmission Rate

Data were provided by the Centers for Medicare & Medicaid Services (written communication; March 2016). The plotted series reflects a 12-month moving average of the hospital readmission rates reported for discharges occurring in each month.

While the Great Recession and other factors played a role in recent trends, the Council of Economic Advisers has found evidence that the reforms introduced by the ACA helped both slow health care cost growth and drive improvements in the quality of care. The contribution of the ACA’s reforms is likely to increase in the years ahead as its tools are used more fully and as the models already deployed under the ACA continue to mature.

Building on Progress to Date

I am proud of the policy changes in the ACA and the progress that has been made toward a more affordable, high-quality, and accessible health care system. Despite this progress, too many Americans still strain to pay for their physician visits and prescriptions, cover their deductibles, or pay their monthly insurance bills; struggle to navigate a complex, sometimes bewildering system; and remain un-insured. More work to reform the health care system is necessary, with some suggestions offered below.

First, many of the reforms introduced in recent years are still some years from reaching their maximum effect. With respect to the law’s coverage provisions, these early years’ experience demonstrate that the Health Insurance Marketplace is a viable source of coverage for millions of Americans and will be for decades to come. However, both insurers and policy makers are still learning about the dynamics of an insurance market that includes all people regardless of any preexisting conditions, and further adjustments and recalibrations will likely be needed, as can be seen in some insurers’ proposed Marketplace premiums for 2017. In addition, a critical piece of unfinished business is in Medicaid. As of July 1, 2016, 19 states have yet to expand their Medicaid programs. I hope that all 50 states take this option and expand coverage for their citizens in the coming years, as they did in the years following the creation of Medicaid and CHIP.

With respect to delivery system reform, the reorientation of the US health care payment systems toward quality and accountability has made significant strides forward, but it will take continued hard work to achieve my administration’s goal of having at least half of traditional Medicare payments flowing through alternative payment models by the end of 2018. Tools created by the ACA— including CMMI and the law’s ACO program—and the new tools provided by MACRA will play central roles in this important work. In parallel, I expect continued bipartisan support for identifying the root causes and cures for diseases through the Precision Medicine and BRAIN initiatives and the Cancer Moonshot, which are likely to have profound benefits for the 21st-century US health care system and health outcomes.

Second, while the ACA has greatly improved the affordability of health insurance coverage, surveys indicate that many of the remaining uninsured individuals want coverage but still report being unable to afford it. Some of these individuals may be unaware of the financial assistance available under current law, whereas others would benefit from congressional action to increase financial assistance to purchase coverage, which would also help middle-class families who have coverage but still struggle with premiums. The steady-state cost of the ACA’s coverage provisions is currently projected to be 28% below CBO’s original projections, due in significant part to lower-than-expected Marketplace premiums, so increased financial assistance could make coverage even more affordable while still keeping federal costs below initial estimates.

Third, more can and should be done to enhance competition in the Marketplaces. For most Americans in most places, the Marketplaces are working. The ACA supports competition and has encouraged the entry of hospital-based plans, Medicaid managed care plans, and other plans into new areas. As a result, the majority of the country has benefited from competition in the Marketplaces, with 88% of enrollees living in counties with at least 3 issuers in 2016, which helps keep costs in these areas low. However, the remaining 12% of enrollees live in areas with only 1 or 2 issuers. Some parts of the country have struggled with limited insurance market competition for many years, which is one reason that, in the original debate over health reform, Congress considered and I supported including a Medicare-like public plan. Public programs like Medicare often deliver care more cost-effectively by curtailing administrative over head and securing better prices from providers. The public plan did not make it into the final legislation. Now, based on experience with the ACA, I think Congress should revisit a public plan to compete alongside private insurers in areas of the country where competition is limited. Adding a public plan in such areas would strengthen the Marketplace approach, giving consumers more affordable options while also creating savings for the federal government.

Fourth, although the ACA included policies to help address prescription drug costs, like more substantial Medicaid rebates and the creation of a pathway for approval of biosimilar drugs, those costs remain a concern for Americans, employers, and taxpayers alike— particularly in light of the 12% increase in prescription drug spending that occurred in 2014. In addition to administrative actions like testing new ways to pay for drugs, legislative action is needed. Congress should act on proposals like those included in my fiscal year 2017 budget to increase transparency around manufacturers’ actual production and development costs, to increase the rebates manufacturers are required to pay for drugs prescribed to certain Medicare and Medicaid beneficiaries, and to give the federal government the authority to negotiate prices for certain high-priced drugs.

There is another important role for Congress: it should avoid moving backward on health reform. While I have always been interested in improving the law—and signed 19 bills that do just that—my administration has spent considerable time in the last several years opposing more than 60 attempts to repeal parts or all of the ACA, time that could have been better spent working to improve our health care system and economy. In some instances, the repeal efforts have been bipartisan, including the effort to roll back the excise tax on high-cost employer-provided plans. Although this provision can be improved, such as through the reforms I proposed in my budget, the tax creates strong incentives for the least-efficient private-sector health plans to engage in delivery system reform efforts, with major benefits for the economy and the budget. It should be preserved. In addition, Congress should not advance legislation that undermines the Independent Payment Advisory Board, which will provide a valuable backstop if rapid cost growth returns to Medicare.

Lessons for Future Policy Makers

While historians will draw their own conclusions about the broader implications of the ACA, I have my own. These lessons learned are not just for posterity: I have put them into practice in both health care policy and other areas of public policy throughout my presidency.

The first lesson is that any change is difficult, but it is especially difficult in the face of hyperpartisanship. Republicans reversed course and rejected their own ideas once they appeared in the text of a bill that I supported. For example, they supported a fully funded risk-corridor program and a public plan fallback in the Medicare drug benefit in 2003 but opposed them in the ACA. They supported the individual mandate in Massachusetts in 2006 but opposed it in the ACA. They supported the employer mandatein Californiain 2007 but opposed it in the ACA— and then opposed the administration’s decision to delay it. Moreover, through inadequate funding, opposition to routine technical corrections, excessive oversight, and relentless litigation, Republicans undermined ACA implementation efforts. We could have covered more groundmore quickly with cooperation rather than obstruction. It is not obvious that this strategy has paid political dividends for Republicans, but it has clearly come at a cost for the country, most notably for the estimated 4 million Americans left uninsured because they live in GOP-led states that have yet to expand Medicaid.

The second lesson is that special interests pose a continued obstacle to change. We worked successfully with some health care organizations and groups, such as major hospital associations, to redirect excessive Medicare payments to federal subsidies for the uninsured. Yet others, like the pharmaceutical industry, oppose any change to drug pricing, no matter how justifiable and modest, because they believe it threatens their profits. We need to continue to tackle special interest dollars in politics. But we also need to reinforce the sense of mission in health care that brought us an affordable polio vaccine and widely available penicillin.

The third lesson is the importance of pragmatism in both legislation and implementation. Simpler approaches to addressing our health care problems exist at both ends of the political spectrum: the single-payer model vs government vouchers for all. Yet the nation typically reaches its greatest heights when we find common ground between the public and private good and adjust along the way. That was my approach with the ACA. We engaged with Congress to identify the combination of proven health reform ideas that could pass and have continued to adapt them since. This includes abandoning parts that do not work, like the voluntary long-term care program included in the law. It also means shutting down and restarting a process when it fails. When did not work on day 1, we brought in reinforcements, were brutally honest in assessing problems, and worked relentlessly to get it operating. Both the process and the website were successful, and we created a playbook we are applying to technology projects across the government.

While the lessons enumerated above may seem daunting, the ACA experience nevertheless makes me optimistic about this country’s capacity to make meaningful progress on even the biggest public policy challenges. Many moments serve as reminders that a broken status quo is not the nation’s destiny. I often think of a letter I received from Brent Brown of Wisconsin. He did not vote for me and he opposed “ObamaCare,” but Brent changed his mind when he became ill, needed care, and got it thanks to the law. Or take Governor John Kasich’s explanation for expanding Medicaid: “For those that live in the shadows of life, those who are the least among us, I will not accept the fact that the most vulnerable in our state should be ignored. We can help them.” Or look at the actions of countless health care providers who have made our health system more coordinated, quality-oriented, and patient-centered. I will repeat what I said 4 years ago when the Supreme Court upheld the ACA: I am as confident as ever that looking back 20 years from now, the nation will be better off because of having the courage to pass this law and persevere. As this progress with health care reform in the United States demonstrates, faith in responsibility, belief in opportunity, and ability to unite around common values are what makes this nation great.


The flaws of the U.S. health care system have been exposed and exacerbated by the coronavirus pandemic. This paper posits three underlying causes of our persistent poor performance: flawed assumptions; inadequate information; and fragmented delivery, payment, and insurance systems that make it easier to profit by shifting risk or costs to others than by improving value. To address these, Americans should adopt a single system approach to delivery, payment, and coverage where comprehensive, real-time information empowers providers and policy makers to deliver better care and protect the public’s health, and where better performance measures and payment models enable competitive markets at every level to reward only those suppliers, providers, and insurers that help deliver better, less expensive care. This approach can satisfy current stakeholders, aligns with key interests of those on the political right and left, and offers a path toward an inclusive, resilient, and high-performing delivery system.

Healthcare Delivery Development and Redesign: Integrating systems for better outcomes.

For over a decade, HMA has been leading the design, development, restructuring and implementation of integrated healthcare delivery systems, with a concentration on populations that depend on publicly funded services and the providers who care for them. We work with a variety of clients to build positive outcomes in:

HMA colleagues have deep and comprehensive experience as clinical leaders, health system administrators, and thought leaders in behavioral health, finance, managed care, information technology, long-term care and community services to meet the specific needs of each client in shaping effective, seamless and sustainable delivery models. All HMA staff members working on these projects have extensive experience advancing innovations in the care of those covered by public programs and those without coverage. For decades, HMA has been helping state and federal healthcare agencies shape systems that meet emerging requirements, and assisting health plans who, more and more, are becoming partners in delivery system restructuring. Our expertise includes:

  • Restructuring safety net providers to function more effectively, including public and private hospitals and health systems, Federally Qualified Health Centers (FQHCs) and public health programs
  • Developing and implementing multi-provider safety net integrated delivery systems focused on defined populations and communities
  • Building innovative models that partner managed care plans with providers to use new payment methodologies and incentivize more effective care delivery
  • Formulating post-acute care continuums, including long-term and community-based care
  • Assuring integration of behavioral and primary healthcare delivery at the practice site
  • Constructing approaches to workforce development to support new delivery system models
  • Assessing and developing information technology tools to facilitate connection between providers, link healthcare delivery with documented community needs and prevent duplication or gaps in care
  • Working at the point of care to implement new care management and practice models built upon evidence and lessons learned in other systems
  • Conducting community- and system-wide assessments, as well as service-specific strategic assessments
  • Developing and guiding implementation of integration work plans in the specific facilities, departments and programs that are critical for success
  • Providing specific consultation, mentoring and training for administrative, operational and clinical leaders
  • Evaluating capital needs and strategizing solutions
  • Reviewing and recommending governance structures for integrated delivery systems
  • Evaluating and negotiating contracts and affiliation agreements between providers, including academic partners
  • Leading operational change management projects
  • Serving in interim leadership roles, e.g. CEO/CFO/CMO/CNO/COO; project management; recruiting permanent leadership, and creating appropriate job descriptions for roles

Health System Transformation

The American Nurses Association (ANA) believes that every person has the right to the highest quality of healthcare. For decades, ANA has utilized the experience and expertise of its members to fight for meaningful health care reform.

Advocating in reaction to political policy

At the highest levels, ANA advocates for policymakers to recognize the true value of nursing, and the unique perspective that nurses have to offer. The voices of nurses are instrumental in advancing public health. The passage of the Patient Protection and Affordable Care Act (PPACA, often referred to as the ACA) in 2010 created essential health benefits, increasing protection for millions of people against losing or being denied insurance. ANA has outlined cornerstones of effective reform.

What’s at Stake Without the Affordable Care Act?

There have been many attempts to repeal the ACA but the strongest began at the end of 2016. In determining whether to support these proposals, ANA analyzed the proposed reforms against its four principles for health care reform. As the nation’s largest group of healthcare professionals, ANA was instrumental three times in 2017 in stopping the passage of legislation that would undermine the current health care delivery system, impacting nurses and their patients.

ANA’s Principles for Health System Transformation

In December 2016, ANA delivered a letter to then President-elect Trump outlining ANA’s Principles for Health System Transformation.
The system must:Ensure universal access to a standard package of essential health care services for all citizens and residents.Optimize primary, community-based, and preventive services while supporting the cost-effective use of innovative, technology-driven, acute, hospital-based services.Encourage mechanisms to stimulate economical use of health care services while supporting those who do not have the means to share in costs.Ensure a sufficient supply of a skilled workforce dedicated to providing high quality health care services.

ANA also spoke out against the proposed American Health Care Act (AHCA) in May 2017, arguing that the reforms would endanger the health of Americans, eliminate the Prevention and Public Health fund, and fundamentally jeopardize the quality of healthcare delivery.

Reform for an aging population

In addition to shifts in political policy, the aging population may necessitate dramatic health care reform. These changing demographics present the need for more complex and longer-term care. To provide the best possible experience for patients, innovative approaches should be considered; whether through utilizing new technologies or by extending the nursing scope of practice to reflect the true extent of nursing expertise.

Promoting ongoing conversations

Like in the case of our aging population, ANA recognizes that the debate over healthcare is ongoing, and we remain committed to educating the public about how nursing impacts our lives and the profession.

ANA continues to deliver the role of the nurse and the profession in a manner that is informative, rich in resources, and solution oriented. We encourage nurses to take action, and advocate for themselves and their patients to all receive the highest quality care.

Health care reform: A consensus on values, but an administrative road to nowhere

Federal health care reform, whatever form it finally takes, is once again an irresistible political force. But when an irresistible political force meets an immovable administrative object, bet on the object.

If you probe the health care stuff on presidential and congressional candidate websites, peruse partisan talking points and fund-raising letters, and parse actual or pending policy proposals, you find that each and every plan now in rhetorical or legislative play for reforming the federal role in health care lays claim to the same trinity of health care reform goals: accessaffordability, and quality. To be sure, some plans are more motivated and focused on increasing coverage (access) relative to containing costs (affordability), but the disagreements nonetheless center on how best to achieve greater access, affordability, and quality.

Right, you scoff, and all the candidates are also all for “peace and prosperity,” too. Actually, they’re not all for “peace;” and, before you shrug off or yawn past the fundamental agreement on what we value most when it comes to health care, recognize that as little as a quarter-century ago there was no such agreement.

In the early 1990’s, nearly a dozen major health care reform plans were discussed and debated, including (as only federal health care reform trivia buffs may recall) McDermott-Wellstone, Michael-Lott, Cooper-Breaux, Thomas-Chafee, and, of course, the Clinton administration’s plan for regional “health alliances” and a “national health board” to set premium targets for each “health alliance.” During the debates over those and other plans, accessibility was still closer than not to being an ideologically charged policy preference that divided Democrats and Republicans.

Intense debates have surrounded and hounded the Patient Protection and Affordable Care Act of 2010, a.k.a., the “ACA” or “Obamacare;” but, compared to a decade ago, and certainly compared to a quarter-century ago, there are now fewer elected voices in either party doubting (and none that I could find openly denying) that accessibility, as in ensuring that people of every demographic description and socioeconomic status are duly insured, is both absolutely essential and highly desirable.

By the same token, today’s fights over affordability qua cost-containment metrics and price-reduction imperatives now center not on the ends, but almost entirely on the means—strongly free market to strongly not, and strongly national government-centric to strongly not. The fact that policymakers all opt to use such rhetoric is revealing, even if some spout it disingenuously. If you take the respective policymakers at their word, affordability is no longer a primarily conservative or Republican health care reform concern, not any more than accessibility is a purely progressive or Democratic concern.

Regarding quality, it’s not, of course, that anyone ever opposed it as such, but rather that calls for better quality now punctuate the health care policy discourse in a pervasive way that they once did not—not even during the early days of the debate over what became Obamacare. Quality is now virtually everyone’s de rigueur health care reform plan qualifier, as in routine promises and reflexive reassurances that increasing access or enhancing affordability is never to be achieved by providing outmoded treatments, discounting ineffective drugs, or serving up yesteryear’s best medicine rather than today’s best.

This relatively new consensus on health care reform values leads to at least three questions worth pondering.

First, among the public at large if not among elected leaders, what, if any, other reform-relevant core values are held dear by most people? It’s hard to know, but in their April 2019 Heritage Foundation brief on opinion surveys about health care, Elizabeth Fender and Marie Fishpaw, in effect, nominated one: “choice.” They highlighted mass support for “lower costs” and “access to high quality” care, but also cited a March 1, 2019 online survey in which 91 percent agreed that “Americans should have more choices for their health care,” and 90 percent agreed that “Patients—not bureaucrats—should choose how health care is provided.”

Second, whatever the fate of this or that health care reform proposal, what about the Big Three programs that together now account for about 25 percent of the entire annual federal budget— Medicare, Medicaid, and the Children’s Health Insurance Program (CHIP)?

Very old news flash: Medicare might or might not become “Medicare for all,” but it is as politically sacred as Social Security. During his two terms in office, President Ronald Reagan not only walked back his famous 1960’s speeches condemning “socialized medicine,” but actually pushed for and won huge expansions in Medicare spending and coverage. The mid-1990s saw the last serious runs at rolling back Medicaid, and they all failed. And, in the mid-2010’s, many governors rejected more federal funds for Medicaid courtesy Obamacare, but most did while claiming that the decision would favor greater access, affordability, and quality for Medicaid recipients.

Established in 1997, CHIP has often been a partisan and ideological political football. Even today, you could fill several double-decker busses with CHIP’s mostly Republican congressional foes; but, you could also then drive them to a party celebrating the program’s 30th birthday. Following several years of legislative battles, including ones that got tangled up with the last federal government shutdown, in 2018 CHIP was reauthorized through 2027. Even its opponents went on record touting it as a triumph for low-income children’s access to affordable, high-quality care.

Third, finally, and looking ahead, can the federal government actually do what the public wants? Nobody truly knows the answer. Worse, judging from the appalling lack of administrative, how-to-do-it detail that accompanies the assorted plans for reforming the federal role in health care, nobody seems terribly interested in finding out.

This is, of course, nothing new. As little as most people know (or care) about the actual legislative and fiscal realities, they know (and care) even less about how any given health care reform plan would be translated from campaign promises and policy rhetoric into actual administrative action.

For instance, writing on the eve of the ACA in his book The Next American Government, Donald F. Kettl observed that our Big Three health care programs, Medicare, Medicaid, and CHIP, were primarily the administrative province of the Centers for Medicaid & Medicare Services (CMS), an agency within the U.S. Department of Health and Human Services (HHS) that has fewer than 5,000 full-time federal employees—fewer full-time staff members than Kettl’s then-academic home, the University of Pennsylvania, employed. And writing for Brookings, Sheila Burke and Elaine C. Kamarck outlined the challenges and capacity of CMS to oversee even the ACA. How could such a tiny agency coordinate or control, manage or monitor, those three existing mega-programs, let alone be reasonably expected to onboard and oversee, institute and implement, any major changes to the federal role in health care?

The answer is that the one agency charged with overseeing health care is already facing a capacity crisis. The sad and sorry administrative saga of Obamacare in the 2010’s was only the latest example of how, for several decades now, would-be presidents, Washington policymakers, and activists in both major parties have debated and, in some cases, enacted health care reform plans that, were, administratively speaking, at best bridges to nowhere and at worst, maps to mismanagement and mayhem.

For instance, in the early 1990’s, had the ambitious Clinton health care plan with its “alliances” not gone down to legislative defeat, it would have experienced an administrative meltdown because its key provisions assumed a system of intergovernmental relations and state-level capacities that did not exist and could not have been created “after the fact.” Much the same could be said for the many Medicaid reform plans that were touted in the mid-1990s.

Likewise, beginning with the “health exchanges,” profound administrative problems, well beyond “computer glitches” or “technology troubles,” have plagued the ACA. Administrative workability, as much or more than political feasibility or fiscal sustainability, has been the Achilles heel of every major health care reform initiative attempted or made over the last thirty years. In “Middle Way Healthcare Reform,” a July 2019 report by Penn’s Partnership for Effective Public Administration and Leadership Ethics (PEPALE), Richard P. Nathan and Praveen Rajaguru emphasize how deeply entrenched and devilishly hard to manipulate are the ways in which America presently administers healthcare.

Administratively speaking, they suggest, health care in America has been, and continues to be, a loosely interconnected but deeply entrenched set of institutional structures and information systems that variously serve more or less distinctive subpopulations: senior citizens and the disabled; low-income children and families; tax-benefitted private employees and their dependents; federal civilian workers; active-duty military personnel; state and local public employees; and subgroups like police and fire personnel, teachers, and corrections officers.

Reforming the federal role in health care in ways that respect the consensus favoring greater access, affordability, and quality would be just wonderful. But what my Brookings colleagues and I preached in the introduction to our aforementioned 1995 book on federal health care reform applies more urgently to today’s competing reform plans than it did to those we probed a quarter-century ago:

Making it work will require sustained effort, from the earliest phases of policymaking, to identify and solve the critical management problems. … Even the most incremental national plans that promise phased-in reforms but gloss over the … realities of policy implementation are bound to get lost in the administrative maze of public, private, and nonprofit organizations that now finance and deliver health care to most Americans.

Resources, “Health care reform.” By Wikipedia Editors; “Real Change,” By Newt Gingrich;, “Health Reform.”;, “United States Health Care Reform Progress to Date and Next Steps.”;, “Healthcare Delivery Development and Redesign: Integrating systems for better outcomes.”;, “Health System Transformation.”;, “Health care reform: A consensus on values, but an administrative road to nowhere.” By John J. Dilulio, Jr.;

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