WASHINGTON — Mere weeks before the 2016 election, Americans who depend on health insurance policies authorized under the Affordable Care Act (ACA) learned that their premiums would rise by 30% on average, with approved rates in some states going much higher.
The dispiriting news released last week provided further confirmation that the ACA, better known as “Obamacare,” is in deep trouble.
But specialists disagree on whether it can be fixed or must be replaced, and the outcome of this policy battle will likely be decided by the next president of the United States.
During the second presidential debate, neither Donald Trump nor Hillary Clinton disputed the fact that the Affordable Care Act faces enormous challenges, with some of the nation’s largest insurance companies fleeing the state exchanges after significant financial losses and the government grappling with sharp increases in health care spending.
“Obamacare will never work,” said Trump during the second presidential debate. “It’s very bad, very bad health insurance.”
Clinton agreed that premiums needed to come down, but added, “if we rip it up and throw it away, what Donald is not telling you is we just turn it back to the insurance companies — the way it used to be. And that means the insurance companies get to do pretty much whatever they want.”
Trump doubled down on his criticisms near the end of the third presidential debate, during a discussion of how to address federal entitlements. “And one thing we have to do: repeal and replace the disaster known as Obamacare,” Trump said. “It’s destroying our country.”
Older and more infirm patients have welcomed a key ACA provision that bars insurers from denying coverage to patients with pre-existing conditions. Yet the plan to cover the costs of their health care by pulling in younger, healthier consumers has failed to materialize.
Now, the government faces the real possibility of a “death spiral” of rising costs matched by shrinking consumer participation.
Clinton contends this problem can be fixed, in part, by pulling in a larger number of younger consumers — a goal the Obama administration has failed to achieve thus far. She also calls for more government regulation to cap premiums and monthly outlays for prescription drugs, while floating a plan to provide refundable tax credits for families struggling with medical bills.
Trump, echoing the free-market policies of the Republican Party leadership, wants to reduce federal government involvement in health care. He would provide block grants to states for Medicaid and tax credits for families and individuals to mitigate the impact of rising health costs.
In June, Speaker of the House Paul Ryan, R-Wis., unveiled a plan that featured these proposals and provided a starting point for further deliberation. His plan would eliminate the ACA’s individual and employer mandates and end both the insurance exchanges and the expansion of Medicaid.
It won’t be easy to find common ground with two radically different approaches for improving health care. Experts further note that efforts to stabilize Obamacare are hamstrung by partisan polarization on Capitol Hill.
The acrimony dates back to 2010, when the Democrat-controlled Congress passed the health bill without a single Republican vote. It didn’t help that President Barack Obama only received the vital support of pro-life House Democrats after pledging to bar the use of federal dollars for elective abortion — a promise that has been routinely violated, according to the Government Accountability Office and other analysts.
Over the past week, the Democrat leadership’s tactics have drawn further scrutiny, with WikiLeaks’ release of hacked emails involving John Podesta, the chairman of Hillary Clinton’s presidential campaign.
In one email chain, Clinton appears to support legislation that she believes will “unravel” Obamacare, though she does not explain her reasoning.
In a second email, a Clinton aide approvingly references Obama’s confrontational language during an early State of the Nation address — language the aide believed had led Chief Justice John Roberts to side with Justices Ruth Bader-Ginsburg, Elena Kagan, Anthony Kennedy and Sonia Sotomayor in the first constitutional challenge to the ACA.
The Clinton campaign has declined to confirm the veracity of the emails. But such revelations will only stiffen the resolve of Republicans and free-market policy authorities to repeal a federal law designed to transform the nation’s vast and growing health care sector.
“I don’t believe the federal government can handle controlling one-sixth of our economy,” Jeffrey Anderson, a senior fellow at the Hudson Institute, told the Register.
‘A Very Shallow Discussion’
Yet plans to consign the law to the ash heap of history look unlikely, and some experts predict that both parties will have to come together.
“We are having a very shallow discussion,” Tom Miller, a specialist on health care policy at the American Enterprise institute, a conservative-leaning think tank in Washington, D.C., told the Register.
“Proponents [of Obamacare] are looking for a way to keep this boat afloat. They don’t want to fundamentally rethink it.”
“Critics say, ‘Make it go away,’ and don’t think too much beyond that. Others say, ‘We could adjust it so it doesn’t work as badly,’” reported Miller.
For example, Miller would back proposals that boost the premium rate for patients who need more services and provide less generous coverage for healthy consumers. He predicted that these proposals could bring down premium costs for young people and get them on board.
“A more far-reaching reform would provide subsidies to all purchasers in individual markets,” Miller added, and consumers would be free to buy their policies in private or government-sponsored marketplaces.
At present, a sea of red ink has led an increasing number of big insurance companies to flee the healthcare exchanges authorized by the ACA, and the Department of Health and Human Services just confirmed that 1 out of 5 consumers on the exchanges will no longer be abe to choose from more than one plan.
Still, Democrats generally reject free-market reforms, and some even support Vermont Sen. Bernie Sanders’ health plan, described as “Medicare for all.”
“The best argument for a single-payer plan is the recent decision” by big health insurers to leave the state exchanges, argued Robert Reich, the former secretary of labor in the Bill Clinton administration, in a column for Newsweek.
Under pressure to outperform their rivals in the marketplace, these insurance companies “claim they’re not making enough money because too many people with serious health problems are using the Obamacare exchanges,” said Reich. “As a result, we end up with the most bizarre health-insurance system imaginable, one ever more carefully designed to avoid sick people.”
‘Public Option’ Proposal
Hillary Clinton has signaled her willingness to consider a Medicare-like public option, which would lower the entry point for Medicare enrollment from age 65 to possibly 50 or 55 and allow consumers the option of “buying into” the federal entitlement.
But most analysts say that path would likely prove too politically toxic, at least in the short term.
“A public option couldn’t pass the Senate in 2010, when Democrats had 60 seats, so in any form it faces an uphill fight in the next Congress,” Jonathan Oberlander, an authority on health care policy at the University of North Carolina-Chapel Hill, told the Register.
Oberlander suggested that Democrats would need to control both the White House and Congress to “pursue again the idea of a government-run, Medicare-like plan to compete in the insurance exchanges.”
He added that proposals to lower the eligibility age for Medicare “also would encounter stiff resistance in the next Congress, and insurers would oppose it, as well as Republicans and conservative Democrats.”
“However, if Democrats stick with the idea, it could well have some possibilities down the line,” Oberlander suggested.
Polls confirm that Obamacare remains deeply unpopular with the majority of Americans, though about 10 million people now receive health insurance through exchanges like HealthCare.gov, and the majority count on subsidies that blunt the pain of rising premiums. Millions more have joined the expanded rolls of state Medicaid programs, another provision provided under the federal law.
The ongoing struggle to provide affordable health policies to the uninsured has dismayed the law’s early supporters. Likewise, controversial provisions in the law, including the Health and Human Services’ contraceptive mandate and a separate mechanism in Obamacare policies that provides subsidies for elective abortion, have sparked opposition from Catholic and Christian leaders and nonprofits, as well as pro-life activists.
In stark contrast to the U.S. bishops’ early support for the ACA — before they opposed a final version that included unacceptably weak language on abortion subsidies and conscience rights — they have kept a low profile as the law sparked debate during the 2016 election year. And years after the ACA's passage, their conscerns about life and religious-freedom issues still take center stage.
“[W]e don’t have a comment at this time,” a member of the U.S. Conference of Catholic Bishops’ media relations staff told the Register, following a query about the conference’s position on proposals to reform Obamacare.
The Catholic Health Association, a lobby for the Catholic health care sector and a staunch supporter of the ACA, had little to say about Obamacare’s woes on its website.
The CHA’s leader, Daughter of Charity Sister Carol Keehan, who invited the president to speak at a 2015 CHA event, was on retreat and not available for comment. Her spokesman, Ed Giganti, told the Register that the lobby viewed the federal law as a critical instrument for expanding access to health care.
“We want to preserve the Affordable Care Act and improve it,” Giganti told the Register.
“We want to provide as much access to health care as possible, particularly for persons that are poor and vulnerable.”
Trend Toward Consolidation
The Kaiser Family Foundation posted a 2015 analysis of the ACA’s impact on Ascension Health, the largest nonprofit health care network in the nation, and concluded that provisions in the law had reduced Ascension affiliates’ expenditures for poor and uninsured patients in states that expanded Medicaid rolls.
Giganti acknowledged that the federal law has spurred the consolidation of health care networks, including last year’s merger of Providence Health & Services and St. Joseph Health.
“With the passage of the ACA, there are economic realities that require [a] greater scale in providing these services,” he said.
The trend toward consolidation partly reflects the impact of ACA rules designed to reduce medical costs, while shifting health care billing from a fee-for-service system to one that rewards better outcomes for patients. Many doctors have left their individual practices to become employees of large health care networks.
John Brehany, the director of institutional relations at the National Catholic Bioethics Center, which advises dioceses on a range of health care issues, echoed the Church's ongoing objections to the government's handling of life and religious-freedom issues. But he also took a critical view of the consolidation of health care systems and suggested the resulting decline in marketplace competition would ultimately boost health costs for consumers.
“The ACA is driving consolidation, and that allows for prices to be raised,” Brehany told the Register.
He also suggested that Catholic social teaching should foster a skeptical view of this trend. The principle of subsidiarity teaches that the provision of services should be handled in the least centralized way possible, so he questioned whether consumers would truly benefit from the consolidation of hospital networks.
Indeed, for the same reason, Brehany warned against the introduction of a single-payer system, like Sanders’ “Medicare for all” proposal.
“Human dignity and Catholic social teachings,” he said, “mandate that we should not have all our decisions determined by a federally controlled single-payer system.”
Joan Frawley Desmond is the Register’s senior editor.