The impact of ObamaCare on doctors and patients, companies inside and outside the health sector, and American workers and taxpayers
Risk corridor data released on October 1 by the administration shows that insurers lost a lot of money on Affordable Care Act (ACA) plans in 2014. The ACA established a three-year risk corridor program to transfer funds from insurers with lower-than-expected medical claims on ACA plans, i.e., profitable insurers, to insurers with higher-than-expected claims, i.e., insurers with losses. Despite administration claims that incoming payments from profitable insurers would cover losses from unprofitable ones, the risk corridor program shortfall exceeded $2.5 billion in 2014. Insurers with lower-than-anticipated claims owed about $360 million, and insurers with higher-than-anticipated claims requested about $2.9 billion from the program.
Beginning in FY 2014, policy changes introduced by the Affordable Care Act (ACA) have been driving Medicaid enrollment and spending growth. This report provides an overview of Medicaid enrollment and spending growth with a focus on state Fiscal Year (FY) 2015 and state Fiscal Year 2016. Findings are based on interviews and data provided by state Medicaid directors as part of the 15th annual survey of Medicaid directors in all 50 states and the District of Columbia conducted by the Kaiser Commission on Medicaid and the Uninsured (KCMU) and Health Management Associates (HMA). Information collected in the survey on policy actions taken during FY 2015 and FY 2016 can be found in the companion report. Key findings related to Medicaid enrollment and spending growth are described below.
Those who reflexively assert that conservative critics of Obamacare don’t have an alternative can’t make that charge. They never could. The architecture of a replacement plan was always taking shape, led by groups like the 2017 Project and people like my AEI colleague Jim Capretta. Governor Bush has laid it out in detail. And the more thoughtful candidates this cycle are aiming to run on it.
While the House Speakership remains in limbo, plans to repeal Obamacare via reconciliation are still moving forward. Last week, the House Budget Committee advanced the bill, which would gut key Obamacare provisions, along with defunding Planned Parenthood for a year–to the House floor.
Community Health Alliance, Tennessee’s health insurance co-op, will stop offering health insurance coverage in 2016, reports The Tennessean. The move will make nearly 27,000 individuals find insurance elsewhere. In January, the co-op froze enrollment. The organization will continue to pay out existing claims and slow down its operations, The Tennessean reports.
Six provisions of the Affordable Care Act (ACA) should come up for target practice next week on the Capitol Hill shooting range. Included in a budget reconciliation measure before the House of Representatives are such items as repeal of the individual mandate, employer mandate, Independent Payment Advisory Board, medical device tax, and auto-enrollment of workers in larger businesses. None of those clay pigeons are likely to suffer any permanent harm, given the certainty of a veto if the bill manages to get to President Obama’s desk. But the latest political contortions over one particular provision — the so-called Cadillac tax – are particularly rich in circular irony and evasion.
Health insurance enrollment data for 2014 shows that the number of Americans with health insurance increased by 9.25 million during the year. However, the vast majority of the increase was the result of 8.99 million individuals being added to the Medicaid rolls. While enrollment in private individual-market plans increased by almost 4.79 million, most of that gain was offset by a reduction of 4.53 million in the number of people with employment-based group coverage. Thus, the net increase in private health insurance in 2014 was just 260,000 people.
Obamacare was enacted more than five years ago, and is now in its second year of nearly full implementation, but, in political terms, it is still not a settled matter. Republicans remain nearly unanimous in their opposition to the law, which continues to inspire widespread unease among the larger electorate. Many of its most important provisions — for instance, the individual mandate, the Independent Payment Advisory Board, and the “Cadillac” tax — are so unpopular that even many Democrats would like to see them repealed.
For decades, federal health policy — through taxes, spending, and regulation — has encouraged people to get their health insurance through their employers, and has encouraged them to choose health plans that pay for routine care. These policy decisions have inflated prices and made insurance harder to obtain for people who don’t have access to employer coverage, and especially for those who have chronic ill health. Obamacare attempted to fix some of these problems, mainly by adding an additional layer of government interventions and attempting to centralize the health-care system.
Jeb Bush’s new health-care plan looks a lot like the plan Scott Walker embraced two months ago, which in turn looks a lot like the one Marco Rubio sketched in an op-ed article and the one touted by Senators Orrin Hatch and Richard Burr and Representative Fred Upton. That’s a good thing. It means that Republicans are finally reaching a consensus on what to do about health policy that draws on the best conservative thinking on the subject. Bush (for whose campaign my wife works) is helping to ratify that consensus.