Billions of Dollars Are in Play Over Health Care Law


obama-health-carePeekskill, N.Y. – In this small city about an hour from Manhattan, laid-off professionals and day laborers without insurance receive care at a community health center that has been part of the social fabric here for nearly four decades.

Because of the sweeping federal health care law passed two years ago, the center, part of the Hudson River HealthCare network, received a $4.5 million grant last month to expand. It plans to add six more medical and seven more dental exam rooms, allowing it to see as many as 5,000 additional patients, many of whom are without insurance, on Medicaid or have limited coverage. An additional 730 community centers or so like it are to be renovated or built across the country in the next two years for patients like that.

Unless the Supreme Court says otherwise.

By the end of June, the court is expected to decide whether some or all of the Obama administration’s health care law is constitutional. While speculation has focused on how the decision would affect the future of the nation’s health insurance market, little attention has been paid to the tens of billions of dollars in federal money appropriated for a host of other provisions in the law.

Exactly what happens to the money for those programs if the Supreme Court decides to overturn the entire law is unclear. Tens of billions of dollars could easily vanish, especially depending on the outcome of the November elections. Congress and the president could always decide to cut the funds for any of these initiatives, especially given pressing political and budgetary realities.

Critics of the law, particularly Congressional Republicans, argue that much of the spending already allocated and authorized is wasteful. They have been particularly concerned over the Prevention and Public Health Fund, whose funds have already been cut by a third as lawmakers sought to find money for other programs.

“Instead of helping Americans prevent health problems, the president’s new law actually uses this so-called prevention fund as a Washington slush fund,” Senator John Barrasso, a Republican from Wyoming, said last month.

He was one of a group of senators calling for the elimination of the fund. Critics cite programs like those improving sidewalks or creating community gardens as frivolous, and Republicans have argued for more accountability over how the money is being spent.

The Affordable Care Act allocates money for such diverse efforts as creating insurance programs for people who have pre-existing medical conditions and cannot find private coverage, offsetting employers’ costs for early-retiree health plans, bumping up the pay for some primary care doctors and a broad array of public health initiatives, like funds for state vaccination programs.

All told, at least $13.7 billion in federal money has already been spent, according to estimates from the Kaiser Family Foundation, a nonpartisan research group that is closely tracking the federal funds. The largest share of future spending, some $1 trillion, is expected to pay for expanding coverage. But the law also calls for significant sums – $100 billion has already been appropriated – to be spent over the next decade on other initiatives aimed at improving the nation’s health care system.

Community health centers, for example, are to receive $11 billion under the law with about $10 billion more designated for a new effort to improve public health. An additional $2 billion has been appropriated to states for care for the aged outside of nursing homes, and there is also $350 million to combat fraud and waste in Medicare. About $200 million is to go to school-based health centers.

If the court strikes down the entire law, many experts are skeptical that lawmakers will go ahead with funds for programs like the new Prevention and Public Health Fund, even if they are completely distinct from the controversial aspects of the law seeking to overhaul the insurance markets.

“I have no confidence that Congress will turn around and adequately fund the public health system,” said Dr. Georges C. Benjamin, the executive director of the American Public Health Association, which represents people working in public health. The federal law sought to remedy years of underinvestment, he said.

The fate of programs like the federally financed state pools for people who cannot get private insurance that were expected to end as soon as the full law went into effect in 2014, when insurers would be required to cover everyone, is also unclear.

About 70,000 people have enrolled in these programs. About $1 billion has been spent so far to help subsidize their coverage and an additional $4 billion has been authorized under the law to keep the programs until 2014.

As a result, people like Linda Ellis, 64, are now insured. Ms. Ellis could not find a private insurance company to cover her when she lost her employer-sponsored plan after being laid off. Her husband is already enrolled in the federal Medicare program, so she had to try to find coverage on her own. She was not eligible for the state Medicaid program. Because of a shoulder condition and minor ailments like sinusitis, no one would offer her a policy when she scrambled to find coverage.

“People don’t realize you can get rejected in the private market even if it’s not life-threatening,” said Ms. Ellis, who now pays $428 a month for insurance from a federally financed state program in Ohio. Ms. Ellis had contacted Families USA, a consumer advocacy group that provided her contact information to The New York Times.

But Ms. Ellis said she had no idea whether she would continue to be covered if the Supreme Court declared the entire law unconstitutional. When she asked the office of her United States senator, she was told no one could say, and federal officials declined to comment on what might happen to any program now financed under the law. “Obviously I’m concerned,” she said.

The largest share of the money to date, about $5 billion, has gone to employers, public retirement plans, unions and others that provide insurance coverage for workers who retire before they are eligible for Medicare. Under this early-retiree program, General Electric and the United Automobile Workers were among those entities receiving money.

G.E., for one, said it had used the $39 million it received under the program to reduce its costs and the costs of both active and retired employees. Republicans like Senator Mike Enzi from Wyoming have argued that much of the money went to unions and state retirement plans as a way of rewarding “politically connected constituencies.”

But Larry Levitt, a senior executive at the Kaiser Family Foundation, said, “Retiree coverage has been under threat for quite a while now.” One of the law’s aims, he said, is to create programs to help companies and workers make it to 2014, when all the insurance regulations was expected to go into effect.

{NY Times/ Newscenter}


  1. But why does the article not explain how this law will not succeed? The only reason that it is “cost effective” for the next 5 years is that the government has been taxing us for the first 5 years since the plan was enacted but only giving coverage for the last 5. So, taxed for 10 but benefits for only 5… hmm…

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