Obamacare, Assessed What’s Working, What Isn’t

By Zachary Tracer and Alex Wayne – – – – –

In October 2013, the U.S. Patient Protection and Affordable Care Act, or Obamacare, took full effect. How’s it doing? No single statistic can cover all of its many aspects. But there are some data sources than can shed some light. It’s helpful to step back from the day-to-day partisan battle and recall the sweeping goals of the law: to give more people health insurance while reshaping a medical system that spends more and delivers less than that of any other wealthy country.

The Situation

Coverage: In 2014, the first full year of Obamacare’s coverage expansion, the uninsured rate fell to 10.4 percent, or 33 million people, from about 41.8 million people the prior year, according to a September 2015 Census survey considered the gold standard for data in the field.At the end of June, about 9.9 million people were covered under the ACA’s individual private health plans. Through August about 13.6 million people had gained health insurance through Medicaid and its related children’s program since the health law, which expanded Medicaid eligibility, took effect, boosting enrollment to 72.4 million. Some of these people had prior insurance, but the Obama administration said in September that the ACA had extended coverage to 17.6 million people who were previously uninsured. Cost of coverage: For people covered through their employers, premium increases for 2015 averaged about 4 percent, with deductibles climbing as well. On individual marketplaces, there’s a wide variation in premium changes. The cost of mid-level health plans is going up about 7.5 percent, on average, the U.S. Department of Health and Human Services has said. Government subsidies help many people afford the coverage. About 84 percent of enrollees on the ACA’s exchanges are subsidized, receiving an average $270 a month. Medical spending: National spending on health care has slowed, a phenomenon that started shortly before passage of the law. Economists say at least part of that change may be attributed to Obamacare, which encourages shorter hospital stays and limits on unneeded procedures. The White House estimates that the Affordable Care Act has shaved at least a half of a percentage point annually from the growth of health-care costs. Still, healthcare spending is projected to account for 19.6 percent of the economy in 2024, up from 17.7 percent in 2014. Litigation: In June 2015, the Supreme Court upheld the nationwide tax subsidies that are a core component of Obamacare, rejecting a challenge that had threatened to gut the measure.

Source: Health Reform Monitoring Survey
SOURCE: HEALTH REFORM MONITORING SURVEY

The Background

The dilemma in shaping Obamacare was how to preserve the country’s system of employer-based insurance for the bulk of the population while ensuring access to coverage for people too sick or poor to afford it. Making it work required a combination of subsidies for middle-income workers, increased spending on Medicaid to cover more low-wage workers, and the so-called individual mandate to make sure health exchanges for individual policies had enough healthy customers to balance out the cost of sicker ones. Working through private companies reduced disruption and kept the insurance industry on board, but also meant the plan did not have the kind of powerful tools used to hold down costs in countries with government-run systems.

The Argument

Polls show that Obamacare remains unpopular with many Americans, although as insurance coverage has expanded outright opposition has declined, and more people now have a favorable view of the law than an unfavorable one. Republicans are still pushing to undo the law. But without enough votes to override a veto, Republican leaders in Congress focused on smaller issues with the law, and won passage of measures to pause or delay a tax on medical device makers and one on high-cost health plans, a charge that many unions and Democrats had opposed as well. Analysts said the $30 billion in lost revenue over a decade would have a minimal impact unless they opened the door to other tax cuts. Many of the law’s specific provisions have substantial support and a majority of Americans opposes repeal. Repeal also carries new political risks now that benefits are in place and the Supreme Court has upheld the law’s subsidies.

THE REFERENCE SHELF

  • The September 2015 report from the U.S. Census Bureau on health care coverage in the U.S.
  • The consulting and accounting firm PricewaterhouseCoopers tracks premium increases and decreases nationwide.
  • McKinsey & Co. also tracks insurers’ rate filings.
  • Actuaries at the Centers for Medicare and Medicaid Services say U.S. health spending will accelerate as Obamacare coverage expands.
  • Blogger Charles Gaba estimates Affordable Care Act enrollment and tracks updated enrollment announcements by states and the federal government.
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