Final answer:
Oliver's insurance claim was denied due to a pre-existing condition, as insurance companies often refuse claims or charge more for those with prior medical issues. The ACA has made strides in preventing this practice by providing coverage for pre-existing conditions and implementing subsidies and mandates to lower the number of uninsured individuals.
Step-by-step explanation:
Oliver's claim for treatment on his broken leg was denied due to a likely pre-existing condition. Insurance companies, prior to the Patient Protection and Affordable Care Act (ACA), routinely denied coverage or charged higher rates to individuals deemed high-risk because of their medical history. The ACA mandated significant changes, ensuring people with pre-existing conditions could obtain insurance and not be overcharged. However, if Oliver’s policy was purchased after sustaining the injury, the insurance company could label the injury as a pre-existing condition, thus denying the claim.
Moreover, patients without insurance tend to rely on emergency rooms, the most expensive form of healthcare, increasing overall healthcare costs. The ACA attempted to reverse this trend by expanding Medicaid, enforcing an individual mandate, and providing subsidies to make insurance more affordable, aiming to reduce the number of uninsured or underinsured individuals. Still, challenges like adverse selection, where sicker individuals are more likely to apply for insurance, contribute to high healthcare costs.