Hillary Clinton was conspicuously quiet about Obamacare in the final weeks of the election, and for good reason. One week before Election Day, the law’s fourth open-enrollment period began, accompanied by a wave of policy cancellations and rate hikes. After analyzing published prices from every state, the New York Times’ Upshot blog confirmed on November 4: “Average Obamacare insurance rates really are going up by 22 percent.”
A few months later, Democrats are heaping criticism on the American Health Care Act, House Republicans’ proposal to significantly tweak the Affordable Care Act, and they are suddenly much more bullish about President Obama’s 2010 legislation.
In sum, then, the GOP’s American Health Care Act would not only roll back all the gains in insurance coverage notched by the ACA over the last four years, but would make millions of Americans poorer and sicker. It’s not a return to the health insurance landscape that existed before the ACA’s enactment in 2010, but a voyage into an immeasurably more dismal, and unhealthier, world.
Writing in the New York Times, Paul Krugman described the health-care system created by Obamacare as “intelligently designed,” while scoffing at Republicans’ proposal, which on Twitter he called “stupid as well as cruel.” David Leonhardt, also writing in the New York Times, admitted that “Obamacare obviously has flaws,” but his example: “Most important, some of its insurance markets — created to sell coverage to the uninsured — aren’t functioning well enough.” That’s a remarkably light slap.
They and others were right. The American Health Care Act has serious problems. (I’ve criticized the GOP’s effort, as have National Review’s editors.) But let’s also not forget that Obamacare is not working, and that without major changes it’s not going to work.
Millions of Americans are not interested in being forced to purchase health insurance.
Enrollment in the law’s insurance exchanges has come in significantly below projections, causing major insurers — UnitedHealth, Humana, and Aetna — to scale back their participation, citing massive losses. Meanwhile several smaller insurance co-ops have shut down altogether. As coverage has become monopolized — about one-third of U.S. counties have only a single insurance provider, and 16 counties in Tennessee probably will not have any provider in 2018 — premiums are climbing, and that’s likely to continue, without competition and without a more diverse insurance pool. The sicker the overall population the insurers must cover, the higher the costs.
And because of that fact, there continues to be the risk of a “death spiral” — meaning that high premiums make healthier people drop their insurance, which increases costs, which increases premiums, which makes even more people drop their insurance . . . Currently, about 26 percent of Obamacare enrollees are between the ages of 18 and 34, compared with the 40 percent the Obama administration predicted would be necessary to keep the exchanges stable.
All of this was foreseeable. The Affordable Care Act imposed unpopular mandates on consumers to help prop up the cost of financially unsustainable requirements on insurers — all toward the goal of expanding coverage, a metric that had never been the aim of health-care policy until 2009. The kludge of government intervention and market forces that resulted was too unwieldy to be effective. As the CBO’s analysis of the AHCA shows, millions of Americans are not interested in being forced to purchase health insurance. To the extent that Obamacare was “intelligently designed,” it was as a difficult-to-uproot political legacy, not as a health-care policy.
Republicans’ alternative to Obamacare deserves much of the criticism it has received. It is the lackluster product of a party that no longer knows what it believes. But no one should be allowed to forget, or misrepresent, the failure it’s trying to fix.
— Ian Tuttle is the Thomas L. Rhodes Fellow at the National Review Institute.