Affordable Care Comes to California


Affordable Care Comes to California

Like many Californians, 61-year-old Mary Gaynor of Berkeley is waiting to see if the Affordable Care Act (ACA) is a good prescription for her health. The unemployed graphic artist has struggled for decades to get treatment for a litany of maladies. But with major provisions of President Obama’s health care overhaul having just taken effect, Gaynor hopes she and millions of other uninsured Americans finally have access to reliable and steady health coverage.

“I’m part of a population that desperately needs Obamacare,” says Gaynor. Unable to work, she subsists on general assistance stipends and relies on the kindness of a friend to pay for one of her medications. “I’m all for it,” she says of the ACA.

Not everyone, of course, shares Gaynor’s enthusiasm. A political lightning rod, the ACA is the country’s biggest health care reform since Medicare. Although it became law in 2010 and was upheld by the U.S. Supreme Court in 2012, it faced backlash from Republican lawmakers that sparked a government shutdown in early October 2013. The rocky rollout of the website that same month provided easy ammunition for critics. And when the President’s statement that no one would have to give up his or her preferred health plan turned out to have exceptions, it further eroded some Americans’ confidence in the new law.

In California, the state’s new health insurance marketplace, Covered California, had a comparatively smooth start when it began enrolling the first wave of uninsured Californians expected to benefit from the ACA. Covered California is envisioned as a one-stop shop for a variety of standardized health insurance plans. The exchange reported almost 1 million visits to its web site,, in its first week of operation. As the program launched, callers initially flooded both the call center and website. From October through December, more than 500,000 individuals enrolled in health plans.

“The response to Covered California has been nothing short of phenomenal,” says Peter V. Lee, the organization’s executive director. The insurance policies are marketed at four levels of coverage—bronze, silver, gold, or platinum—and include such mandatory benefits as preventive care, prescription drugs, and hospital stays. Under the new law, insurers are prohibited from denying or canceling coverage because of pre-existing conditions or new illnesses.

All told, an estimated 2.6 million lower-income Californians qualify for financial assistance to buy Covered California insurance plans, and an additional 2.7 million people could benefit from guaranteed insurance purchased through the marketplace or privately. Another 1.4 million people are newly eligible for Medi-Cal, thanks to California’s widened access of its health care program for lower-income residents.

The Golden State is considered a bellwether for the ACA and its ability to pull off a sweeping expansion of affordable health coverage. One of the first states to embrace the law, California runs the biggest state insurance market in the country.

The Golden State is considered a bellwether for the ACA and its ability to pull off a sweeping expansion of affordable health coverage. One of the first states to embrace the law, California runs the biggest state insurance market in the country. (Because some states declined to set up health exchanges for political reasons and others were unable to do so, the federal government is operating many of the marketplaces.)

“There are a lot of eyes focused on California and how it works out,” says Professor William Dow, who heads the Health Policy and Management Division at the School of Public Health.

The School of Public Health has taken a lead in analyzing the ACA and how it will shape health care. One of the most significant efforts united the School’s policy experts, government officials, and leaders of private health care organizations to create a new vision for more affordable and effective health care in California.

Called the Berkeley Forum, the group made a dramatic proposal—to fundamentally restructure how health care is delivered and financed by pulling away from the traditional fee-for-service model of health care. Fee-for-service pays providers for each treatment or procedure rendered.

In its place, the Berkeley Forum, which included presidents and CEOs of major health insurers and delivery systems such as Anthem Blue Cross, Blue Shield of California, Kaiser Permanente, and Sutter Health, recommended a “rapid shift” to coordinated care for patients along with risk-adjusted global budgets to pay for it.

Under such a scheme, health plans and providers would agree on fixed spending targets that are adjusted for the underlying health of their patient populations and would reward doctors and hospitals for quality care and patient satisfaction. Providers also would be encouraged to participate in integrated systems that coordinate care for patients across a spectrum of health-care providers and facilities.

The group’s call for change was spurred by concern over the soaring cost of health care and the state’s ability to care for millions of newly insured Californians. By 2022, employerbased insurance premiums are expected to represent almost a third of a family’s median household income.

“Something has to change. We can’t continue to spend more and more of our income on health care,” says Liora Bowers MPH ’11, who, along with Professor Richard Scheffler, is among the report’s lead authors.

“What’s really important about this report as much as the data and the findings is who is saying it.”

The Berkeley Forum predicts its interventions—which also include measures such as increased physical activity by patients and greater reliance on nurse practitioners and honoring patient wishes for palliative care—would save the state some $110 billion in health care costs over the next decade. That translates into $802 in yearly savings per household.

Professor and Dean Emeritus Stephen Shortell says the recommendations reveal a willingness by key industry players to transform how health care services are financed and provided. “What’s really important about this report as much as the data and the findings is who is saying it,” says Shortell, who served as the Berkeley Forum’s chair.

On other fronts, the School hosted a series of lectures on the ACA and its impact, and across the Berkeley campus, researchers are studying the new law from a variety of angles. For instance, the UC Berkeley Labor Center predicted that 3.1 to 4 million Californians would remain uninsured after the ACA’s full implementation. Researchers say those numbers could be mitigated by outreach and enrollment efforts targeting Latinos and other groups that tend to be uninsured. Undocumented immigrants, including an estimated 2.5 million in California, are not covered by the ACA.

Nonetheless, Dow predicts that the ACA “is going to improve the lives of people, improve their access to health care, and improve some dimensions of health.”

Dr. Mark B. Horton, former director of the California Department of Public Health and a member of the School’s Policy Advisory Council, agrees. “I come at this, first of all, from a social justice perspective,” he says. “What the ACA does here in California and most other states is come close to closing the gap in access to quality health care. There’s no question this will have an impact on the health of our population.”

But Dow and Horton remain concerned about the program’s long-term price tag. The ACA is budgeted to cost $1.7 trillion over the next decade. “It is fully paid for on paper, but whether or not this all plays out as projected remains to be seen,” says Dow.

Despite the intense focus and continual political wrangling, many people have only a hazy understanding of the law. A November 2013 survey by the University of Southern California and the Los Angeles Times revealed that while 50 percent of California voters support the Affordable Care Act, 42 percent say they lack information on the law.

“We’re aware that it’s a complex issue,” says Covered California spokeswoman Anne F. Gonzales. The organization is responding with a statewide education campaign that includes television ads and other marketing strategies.

Up to 16,000 enrollment counselors speaking 13 different languages are being trained to help California consumers shop and sign up for health plans.

Statewide, many health providers are anticipating a new landscape. For LifeLong Medical Care, a nonprofit founded in Berkeley that provides health and social services to underserved residents like Mary Gaynor in Alameda, Contra Costa, and Marin counties, the ACA could translate into Medi-Cal coverage for roughly half of the organization’s estimated 12,000 uninsured patients. Some of those clients now wait months for specialty care at Alameda County’s overcrowded Highland Hospital. With Medi-Cal, they would have access to a broader network of providers to treat diabetes, heart conditions, and other serious health problems.

“It gives them a card in their pocket,” says Marty Lynch, executive director and CEO at LifeLong. “It’s a big, big advantage of Obamacare.”

To handle an increased demand for services at its 10 primary care health centers, LifeLong hopes to hire more staff and expand clinic hours.

The ACA is “definitely a step in the right direction,” says Lucinda Bazile MPH ’94, regional director of LifeLong’s Contra Costa Health Centers and past president of Berkeley’s Public Health Alumni Association board of directors. “For people who haven’t had health insurance in their life, this is a great opportunity to get access to care and, we hope, access to prevention.” founders-swirl-16px

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