The most popular parts of the Affordable Care Act (ACA) are the most expensive. Universal coverage is a top priority not only for Democrats but also for President Trump. Both Republicans and Democrats want to preserve many costly coverage features of the ACA, including those that prevent insurers from precluding people with preexisting conditions and those that eliminate lifetime or annual coverage limits. The challenge is how to preserve these features and make insurance affordable.
House conservatives rebelled over the original version of the American Health Care Act, which only partially deregulated insurance markets. The bill maintained the rule known as guaranteed issue, which requires insurers to cover all applicants regardless of medical history. It also relaxed community rating, which limits how much premiums can vary among beneficiaries.
The media and the left thus claim that conservatives want to allow insurers to charge sick people more, and some conservatives agree, which spooks the moderates. But the latest compromise between conservatives and centrists doesn’t repeal guaranteed issue or community rating. It keeps these regulations as the default baseline, and states could apply for a federal waiver if they want to pursue other regulatory relief.
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There’s no way around a simple truth: treating an expensive health condition costs (someone) lots of money. There are four basic approaches that can be taken to this problem: 1) Leave sick people to face the costs of their own treatment, whether out of pocket or through high-cost insurance, no matter how ruinous those costs become; 2) Mandate that other, healthier people overpay for the value of their own health insurance, so that sick people can underpay for the value of theirs; 3) Spread the costs of paying expensive health bills throughout society, for example by having taxpayers pick up the tab; and 4) Require a targeted group to shoulder the costs. [The AHCA opts for 3).]
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As House Republicans regain momentum in their quest to replace Obamacare, GOP moderates have done something unexpected: they’ve focused not broadly on covering the uninsured, but specifically on protecting those with pre-existing conditions. There’s a reason for that, and it has to do with wildly exaggerated claims that Democrats made when they were passing the law in 2009 and 2010.
The vast majority of Americans who are uninsured aren’t without coverage because of a health problem. They’re uninsured because of an economic problem: the problem that American health care costs too much, especially for lower-middle-income Americans who earn too much to qualify for government assistance.
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Many people are going without insurance under ObamaCare because they cannot afford the law’s expensive plans or aren’t aware of their options. Congress can help these Americans and many others get insurance by enrolling them in no-premium, no-obligation plans from which they could withdraw if they wanted to. Opponents will argue that automatic enrollment infringes on personal liberty. But people placed into such coverage would be free to opt out or to select an option that better suits their needs. Few people opt out of employer pensions when they are placed into them automatically, and no-premium insurance would impose no cost on the enrollees.
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One of the more interesting television commercials I see is an ad sponsored by Cancer Treatment Centers of America. The message: if you have cancer, we want you.
Welcome to a small glimpse of how the market for health care might be different.
If we had a genuinely free market for health care, ads like this would not be rare and unusual. There would be centers of excellence for heart disease and diabetes and dozens of other afflictions. Through television, radio, the Internet and other means, these centers would be seeking out people with problems and offering to solve them – just like in other markets.
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There is no precise headcount of how many people have gained coverage because of the Affordable Care Act. And it is downright impossible to reliably estimate the number of people who might lose coverage if Congress repeals and replaces it. The “20 million” figure appears to have originated in a March 2016 report by the U.S. Department of Health and Human Services. That report declared that “the provisions of the ACA have resulted in gains in health insurance coverage for 20.0 million adults through early 2016.”
Estimates by the Heritage Foundation find that 14 million people (including children) gained public or private coverage in 2014 and 2015. Unlike government surveys, Heritage examined data from insurance company regulatory filings and from the government’s own headcount of Medicaid enrollment.
They found that 84% of the newly insured gained coverage through Medicaid and a related government program for low-income children.
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The Affordable Care Act (ACA) has substantially increased the number of Americans with public and private health insurance coverage. The Assistant Secretary for Planning and Evaluation (ASPE) at the US Department of Health and Human Services estimates that the ACA has resulted in 20 million additional nonelderly adults gaining coverage between the law’s enactment and February 2016. This estimate is likely overstated. Government surveys’ estimates of the number of people who gained coverage between December 2013 and December 2015 vary by 20 percent. Moreover, while the ASPE estimates that the ACA increased the number of young adult dependents with insurance coverage between 2010 and 2013 by 2.3 million, data from government surveys indicate that 1.2 million fewer dependent children had private coverage in 2013 than in 2010, offsetting half the gain in coverage among older dependents. Coverage gains have nonetheless been significant, with most of the increase coming from enrollment surges in Medicaid and the Children’s Health Insurance programs. But a substantial proportion of those who have enrolled in these public programs since 2014 met eligibility standards that predated the ACA. This increase in public coverage may have crowded out private coverage, although further study is needed to determine the existence and magnitude of this effect.
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In his first post, Conover argued that drawing inferences from observational studies about whether covering the uninsured will save lives is a fool’s errand . Quasi-experimental studies hypothetically provide a better tool for figuring out whether insurance coverage reduces mortality risks. Unfortunately, the two studies we have available are very unreliable instruments for figuring this out.
That said, based on the two studies reviewed, Conover cannot rule out the possibility of “excess deaths” in the event some people lost coverage as a result of repeal-and-replace efforts. Ironically, because the lion’s share of coverage gains under Obamacare has been through Medicaid, the New York study arguably is the most appropriate one to use to determine the effects of repeal. However, it is less credible than the Massachusetts study in terms of how much confidence anyone should have in its results.
In short, beware of anyone who claims we will lose 1 life for every 435 newly uninsured. 1 life for every 830 people is more believable, but even that is exaggerated and is far more likely to apply to those gaining private coverage than those enrolling in Medicaid. Unfortunately, the current state of science does not provide a very solid basis for guessing how much this estimate is inflated.
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