The Patient Protection and Affordable Care Act faces possible obstacles that could derail its implementation, despite carefully constructed incentives and safeguards, according to a report from The New York Times.
As the health insurance exchanges open for enrollment in October, adverse selection is probably the biggest threat to the law's success, according to the report. Millions of healthy, young and currently uninsured people must enroll to counteract the sicker Americans who are most likely to buy health plans; otherwise, plans will have to raise their premiums to compensate for high care costs.
Additionally, some economists have expressed concern that insurers with small market shares won't have the ability to bargain effectively with hospital systems, especially given the rising rate of hospital consolidation producing enormous systems, according to the report. Researchers have also found that top hospitals increase their fees when there are more health plans competing for their business.
Disaster seems unlikely because of PPACA risk adjustment mechanisms and provisions meant to mitigate adverse selection, according to the report. However, studies have reached drastically different conclusions about how risk adjustment will affect costs and adverse selection, and limited hospital competition could undo the law's safeguards.
More on PPACA Implementation:
PPACA Data Hub Deadlines Not Met, HHS Says
Sebelius Criticizes Predictions of Rising Insurance Rates Under PPACA
Consumers Can Set Up PPACA Healthcare Accounts in Advance of Exchanges