The core problem with President Obama’s most recent speech in defense of his health care law was not that he simply overestimated the merits of Obamacare. It’s that he refused to acknowledge that conservatives have reasonable disagreements with him about the direction of health care policy. President Obama claims that Republicans have offered no alternatives to the health care law when they have in fact outlined their own far-ranging plans for health policy. President Obama believes that only comprehensive insurance policies are real insurance. Conservatives generally believe, by contrast, that people should be free to buy cheaper policies that protect them only from financial catastrophes arising from their health needs.
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Bob Kocher and Ezekiel Emanuel, who worked in the Obama White House on health care reform, argue that it’s “misleading” to raise concerns about the fact that individual market health insurance premiums have nearly doubled under Obamacare. “Premiums today,” they say, “are 20% lower than the Congressional Budget Office predicted when the ACA was passed.” Their argument is nonsensically out of touch, and it illustrates why the designers of the ACA got so many things wrong. The unaffordability of exchange-based insurance is the ACA’s most serious problem. As research from Avalere Health has shown, enrollment in ACA-based insurance is alarmingly low among those whose incomes exceed 200% of the federal poverty level.
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The 40% “Cadillac” Tax on expensive employer-sponsored health insurance is on a deathwatch because both parties in Congress dislike it. It would be best if Congress were to replace the Cadillac Tax with a simple and clear limitation on the tax preference for employer-paid premiums, as is called for the House GOP’s “Better Way” health plan. For decades, economists have complained that the open-ended tax break for employer-paid health insurance premiums is a major distortion in the marketplace. This approach is fair and promotes more transparency in the health care marketplace.
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The loss of what remains of Americans’ health care freedom is an election away. For the Obamacare of today to be transformed into the Hillarycare of 1993 and finally into a nationalized health care system, a president is needed who has the willpower to impose the coercive details, nail down hard deadlines and unleash agencies to tighten controls and squeeze the life out of private insurers. In 1993, Hillary Clinton unapologetically proposed to do just that. If she is elected president, she will have the unilateral power under Obamacare to do it.
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Obamacare is collapsing. Its utter failures become more obvious by the day. We all remember the promises of Obamacare, chief among them that the “Affordable Care Act” would lower health care costs. The opposite has occurred. Despite the offer of subsidies through the exchanges, enrollment in Obamacare has been dismal. Younger, healthier individuals have little interest in paying exorbitant premiums for insurance plans that come with $5,000 deductibles. The result has been an unbalanced insurance pool where insurers must charge ever-increasing premiums to continue offering coverage.
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Nearly 30 million American adults remain uninsured. Despite the Affordable Care Act’s vast—and growing—cost to taxpayers, it has failed to place the U.S. on the road to near-universal health insurance coverage. To deliver coverage that is more affordable and attractive to middle-class Americans, structural reforms to the ACA are urgently needed. Until then, America’s middle class will suffer the ACA’s high costs without enjoying its benefits.
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The problems emerging in the exchanges are a symptom of a larger disease, which is that the ACA moved far too much power and regulatory control over the health sector to the federal government. Building a broader consensus around reform of the individual insurance market will almost certainly require revisiting other fundamental aspects of the ACA that have sharply divided policymakers.
The ACA exchanges will not be able to continue indefinitely without substantial reform. But reform will only be possible if the American public believes that this will not merely be another intrusion into their personal health decisions and their wallets. It will be up to Congress and the next President to decide if America’s health care system is worth the political risk needed to enact responsible and necessary reforms.
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Six and a half years after the ACA was signed into law, health reform no longer feels like a steady forward march toward progress. It feels more like World War I: dotted with landmines, lined with trenches, and ending inconclusively. In 2010, the Congressional Budget Office predicted that 21 million people would be enrolled in the ACA’s insurance exchanges by 2016; as of now, only 12 million are. That gap between hype and reality is likely to further expand over time.
What happened? It’s a long story, of course. But the simple answer is that the ACA’s exchanges were designed poorly and implemented poorly, by overconfident advocates who dismissed any and all criticism, no matter how well-reasoned.
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Proponents of the Affordable Care Act made several promises before and since the law passed. The most notorious of these was President Barack Obama’s assurance that people could keep their insurance plan if they liked it. However, other important promises were made that have garnered less media coverage, including how many people would enroll for coverage in the new health insurance exchanges, the law’s effect on health insurance premiums, the amount of choice and competition in health insurance markets, and the law’s impact on overall costs and the deficit. These promises arguably helped ensure some of the votes necessary for the controversial legislation to pass Congress.
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When Bill Clinton emerges as an ObamaCare critic and even President Obama admits in a recent interview that his entitlement has “got real problems,” the discipline of the law’s apologists must be fading. The question now is whether Republicans can capitalize to improve U.S. health care from its ObamaCare bottom. The balance of political power will be crucial in 2017 because ObamaCare will have to be rewritten. Trump’s opportunity would be that ObamaCare legally empowers the Health and Human Services Secretary to loosen regulations if a President concludes that they “destabilize” health markets. As for Clinton, she’d need GOP help in Congress unless she wants to preside over a bigger mess.