Obamacare helps millions, but falls short in many ways

Introduction

Although there is no shortage of critics of the Affordable Care Act — on the far left as well as the right — it’s hard to dispute that the law has benefited millions of Americans. And not just those who have become newly insured over the past year.

President Barack Obama cited some of the impressive statistics last Thursday, the day after the one-year anniversary of the turbulent debut of the Obamacare-created online health insurance exchanges.

“In just the last year, we’ve reduced the share of uninsured Americans by 26 percent,” he said. “That means one in four uninsured Americans — about 10 million people — have gained the financial security of health insurance in less than one year.”

Approximately 8 million people were finally able to sign up for coverage on the exchanges after the many technical problems were fixed. Many others were able to enroll in health plans on private exchanges or by working directly with an insurance company or agent. As a consequence, the rate of uninsured Americans dropped from 21 percent in September 2013 to 16.3 percent this past April.

Even though open enrollment for the Obamacare exchanges ended in April, people have still been joining the ranks of the insured since then. In fact, the Congressional Budget Office estimates that the number of newly insured Americans will grow to 12 million by the end of this year.

A significant percentage of those folks were not able to find affordable coverage in the past, and many were not able to buy health insurance at any price because of insurance industry business practices that were outlawed by the ACA. Before Obamacare, insurance companies were able to declare you “uninsurable” if you had a preexisting condition, even conditions you might have been born with.

During the months that health care reform was being debated in Washington, I met many young people who told me they had not been able to buy an insurance policy because of congenital heart defects and other conditions they had had since birth.

Now they can.

That provision and other parts of Obamacare that force insurance companies to be more consumer-friendly benefit all of us, but those sections of the law are rarely mentioned these days, probably because many of them went into effect long before the exchanges were up and running. Here’s a partial list:

• Insurers can no longer “rescind” our policies when we get sick just to avoid paying our medical expenses;

   

• They must allow our children to stay on our policies until they turn 26 if they can’t find jobs that offer coverage;

   

• They can’t devote more than 20 percent of our premium dollars to overhead and profits;

   

• They can no longer charge women more than men; and

   

• They can’t charge older folks more than three times as much as they charge young people for the exact same policy.

   

The law also benefits seniors on Medicare by closing the donut hole in the prescription drug benefit and by covering preventive care, including screenings, and it is saving the Medicare program billions of dollars by gradually reducing the extra amounts the government has been paying private insurers to participate in the Medicare Advantage program.

All that said, the law falls short in many ways. While it is reducing the rate of uninsured Americans, it doesn’t get us anywhere close enough to the universal coverage that residents of other developed countries enjoy. While the ACA will cut the number of uninsured by half in the coming years, the CBO estimates that 31 million of us will still be uninsured in 2024.

Many of the newly insured are also finding that their choices of health care providers is severely limited in some of the health plans being offered on the exchanges. “Narrow networks” are not new — they were common in the managed care plans of the 1990s — but insurers gradually began to broaden their networks after widespread complaints. Now they’re making a comeback.

The ACA also allows insurers to sell plans with very high deductibles. They can appear at first glance to be good deals because their premiums generally are lower than plans with more modest deductibles. But many people who enroll in high-deductible plans find out after they get sick or injured that they can’t afford to pay their share of their medical bills. Although the ACA does put a limit on out-of-pocket expenses, it still will not prevent many insured families from filing for bankruptcy after a serious illness.

And while the law apparently is helping to keep medical costs in check, it doesn’t go far enough. We still spend more per capita on health care than any other country. In that sense, I agree with my former colleagues in the insurance industry: the law doesn’t do enough to address the “real cost drivers” of medical inflation. That will require taking on the hospital companies, physician organizations and drug makers in ways the White House and members of both parties in Congress were not willing to do in 2009 because of the political clout they have in Washington. Consequently, much more reform will have to be undertaken in years to come.

Wendell Potter is the author of Deadly Spin: An Insurance Company Insider Speaks Out on How Corporate PR is Killing Health Care and Deceiving Americans and Obamacare: What’s in It for Me? What Everyone Needs to Know About the Affordable Care Act.