Happy birthday, ObamaCare. If only you were strong enough to blow out six candles.
After a difficult gestation, an awkward birth and a few trips to the ER (aka the Supreme Court), the Affordable Care Act turns 6 years old on Wednesday. It made it through nursery school and kindergarten, but it’s still a very troubled child.
I have no doubt whatsoever that President Obama had noble intentions when he signed the ACA on March 23, 2010. He believed health care was a right, not a privilege, and that all Americans – regardless of their financial circumstances and including those with pre-existing conditions – should be able to obtain health insurance. And if they couldn’t afford it, the government would assist them.
But even then, it was clear to me that the math was all wrong, and that parts of the law would be economically unsustainable. I said we needed to look much more carefully at how much it really would cost to implement the law and to ensure the program would remain solvent.
I regret to say that I was advised at the time that speaking out might jeopardize my health care business, and that I should keep my thoughts to myself. Now, six years later, I wish I’d shouted it from the rooftops, because we might have avoided the mess we’re in. I hate saying “I told you so.”
Two weeks before ObamaCare became law, House Minority Leader Nancy Pelosi famously said, “We have to pass the bill so that you can find out what’s in it.” The congresswoman took a lot of flak for that remark, but she was right. We really had no idea what lay ahead.
Now, six years later, we have lots of hindsight. Here are the brutal facts:
• Twelve of the 23 Consumer Operated and Oriented Plans (co-ops) in the U.S., which were intended to spur competition and lower prices, folded in 2015, costing American taxpayers more than $1.23 billion.
• Risk corridors, which enable the government to compensate insurers that underestimated costs and undercharged their subscribers, paid out much less than the insurers expected because the funds dried up. What’s more, the program is due to expire after this year.
• As a result, insurance premiums and deductibles have gone up dramatically, while the number of doctors patients can see has gone down.
• The losses incurred by the major insurers in the past year have been staggering, and the likes of UnitedHealth, Aetna and others have signaled that participating in health insurance exchanges may no longer be sustainable.
• The number of young, comparatively healthy people who were expected to sign up and balance out the insurers’ payments to older, sicker people fell drastically short of expectations, which in turn compounded the problem of rising costs. Penalties finally are kicking in for people who don’t buy plans, but young adults may be willing to pay the penalty, which is considerably lower than the cost of a policy, and gamble that they will remain healthy. And if they make that choice, it remains to be seen how successful the government will be in its collection efforts.
• It’s getting increasingly harder to “keep your doctor.” In order to keep costs down, insurance companies have drastically narrowed their networks to include a slate of physicians they consider “more efficient.” And access to doctors has become even more challenging in states that have expanded Medicaid, since many physicians are opting out of the program due to declining reimbursements.
As people complete their tax returns in the next few weeks, it will be interesting to see how successful the government is in determining who actually has insurance and whether people who are eligible for subsidies are getting what they need.
And then, once we know that, we need to go back to the drawing board. Our new president, whoever he or she is, needs to sit down with House Speaker Paul Ryan, who understands budgetary concerns better than just about anyone, and realign the funding to make ObamaCare solvent.
Meanwhile, let’s stop the nonsensical talk about repealing every word of the law on “Day One,” because it just isn’t going to happen. It makes for a good sound bite, but we’re not going back to denying insurance to people with pre-existing conditions. We’re not going back to forcing young adults off their parents’ policies on the day they turn 18, or when they graduate from college.
As we approach the peak of the election season, every candidate should have ObamaCare at the top of his or her agenda. We need to start working on an Affordable Care Refinancing Act that will fix the math and make the law sustainable.
Because, like any 6-year-old, ObamaCare should have every opportunity to turn 7.