reagan’s obamacare legacy

(Image from theheatlightning.com)

With the announcement yesterday that another judge has found the “personal mandate” aspect of the Affordable Care Act unconstitutional, I wanted to point to this post by Ezra Klein that deals with another acronym with which you might be less familiar, EMTALA.

Passed in 1986 and signed into law by none other than Conservative Superman President Reagan, the Emergency Medical Treatment and Active Labor Act specifies the obligations that a hospital must fulfill when someone arrives at the hospital requesting “examination or treatment for a medical condition.” EMTALA specifies that should an initial examination provide evidence that the patient is suffering from an “emergency medical condition”, the hospital has an obligation to provide “such treatment as may be required to stabilize the medical condition”, or if their facilities are not adequate, a transfer to another hospital.

As Ezra’s commenter pointed out, this requirement provides a very strong argument for the need for an insurance mandate by acting as an “insurance-of-last-resort” for those who are not insured through other means. The problem with this “insurance-of-last-resort” is that it is free; nobody is forced to pay a premium to be covered under EMTALA. This “mandate gap”, requiring hospitals to provide care without requiring potential patients to be able to pay for it, introduces a large externality into the health care system: the costs of emergency care are not necessarily borne by those seeking such care.

The idea that a hospital does not have the option to turn people away from care but that people have the option of putting themselves in the position where they will be unable to pay for such care is incoherent, and results in higher costs for those responsible and financially sound enough to purchase their own insurance. We need for people to be responsible for the costs that they impose on the health care system, and we can accomplish that in one of two ways: (1) an individual mandate that ensures everyone has an arrangement in place for paying their medical bills or (2) eliminating EMTALA, allowing hospitals to turn away people based on their ability to pay to prevent free-riding in the health care system.

In my eyes, the choice between the two is a no-brainer.

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3 Responses to reagan’s obamacare legacy

  1. Mary Lyn says:

    Great post. Another interesting aspect is that hospitals can not refuse an EMTALA transfer. Would love to discuss more.

  2. Steph says:

    I agree with ML–great post, and anti-dumping laws like the EMTALA transfer acceptance requirement are interesting illustrations of the way the safety net plays out in the U.S. If you ever have a chance to read some of the cases that led to EMTALA, like Cambell v. Mincey or New Biloxi Hospital, Inc. v. Frazier, check them out–they’re helpful in showing that the baseline that we now expect (as evidenced by George W. Bush’s infamous comment about universal health care access through emergency rooms) had to be legislated into existence. Barring a SCOTUS ruling that the individual mandate is unconstitutional, I would expect Americans 20 years from now to have a hard time imagining a health care system where people weren’t expected to contribute simply because they’re part of this society.

    I think it’s interesting that one of your main points is that we need everyone to be responsible for their costs in the health cares system and I think that deserves a lot more discussion. I personally come at this from more of a social solidarity bent. While I think individual behavior and individual financial contributions to enable the system to work are important, I don’t think the idea of consumer “skin in the game” is the right approach and I don’t think it will be effective at containing health care costs. Or, at least not without cutting both necessary and unnecessary utilization. There are more nuanced ways to approach reducing national health expenditures (or at least reducing its growth) while still improving care, and improving population health. In my mind, the point of the individual mandate is not to make people responsible for the costs they incur but to get everyone in the system, so that we can start to make the system work better overall. The individual mandate is just a mechanical necessity of the structure of the Affordable Care Act. We could have gone with a single-payer system instead with taxes taking the place of individually- or group-paid premiums and the tax revenue (“penalty”) from the individual mandate.

    • frouglas says:

      Steph – I think that we’re getting at similar points here, from slightly different angles. I was not trying to say that the only way our health care system will work is if all consumers have some “skin in the game”, which is what it may have sounded like. I think that you’re right in that the constitutional mandate’s main purpose is to get everyone in the system so that we can start working on improving it. The point I was going for was that the way that the system is set up now illustrates why we need everyone in the system. We need everyone in the system because they’re already all in the system through the EMTALA.

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