Health Care Reform: Can it Work From a Business Perspective?


The Affordable Care Act, more widely known as Obamacare, has sparked heated debates across the country and was the focal point of the first government shutdown in almost two decades. Drexel professor Dr. Michael Howley, an associate clinical professor of marketing at Drexel’s LeBow College of Business, recently shared his thoughts about health care reform and whether or not it will succeed.

HowleyRethinking our health care

According to Howley, who has a background in both business and health care, the real impact of the ACA will come from the restructuring of the insurance markets. This restructuring should help health care markets function more efficiently but people also need to start thinking about health care differently.

“Now we tend to react to an illness and count on insurance to be there if we ever need it,” said Howley. “Instead, we need to look ahead at our future health situation and prospectively manage that risk. We should manage our health insurance like we manage our retirement plans.”

Federal vs. state exchanges

While the federal online exchange or marketplace rollout has been disappointing, the state exchanges have been working well, according to Howley. The biggest failure of the implementation for Howley is the large group of states that have yet to embrace reform.

“In the early stages, we are seeing that reform works if you engage and invest to make it work. The states that are unhappy with reform have refused to set up exchanges and left it to the federal government. Now those states are complaining that the federal exchange is overwhelmed,” he said.

The biggest problem with the exchanges is that they are far more complicated than anything that has been tried before. “These are not like simple travel sites or even comparable to the earlier state exchanges in Massachusetts,” said Howley. “They are trying to integrate databases that handle very sensitive information and present the results in an instant.”

Fallout if the individual mandate is delayed

Though the employer mandate was delayed already, Howley advises against similarly delaying the individual mandate. The employer mandate was delayed because of problems with documenting all employees, but Howley said there are three very important reasons why the individual mandate needs to be enforced. They are: adverse selection, pricing and the customer pool.

With adverse selection, only the sick would sign up for health care insurance but to make the markets work everyone needs to be in the marketplace.

Deferring the individual would also lead to incorrect pricing. Insurance companies are currently trying to figure out the average price they can charge to get it to work. If only the sickest people sign up, than the pricing of insurance would be much more expensive.

Finally, Howley noted that a lot of companies have invested in a market that is supposed add up to about 50 million people. They have all made investments in technology, marketing, and business processes for this large group of people so to see the return on those investments they need to find that customer pool.

Despite all that is being discussed around the ACA, Howley remains optimistic that it will succeed. To read the full interview with Howley, visit the Lebow College of Business website at To schedule an interview with professor Howley, contact Niki Gianakaris at 215-895-6741 or

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