Theodore Roosevelt is credited as saying, “Comparison is the thief of joy.” When it comes to healthcare, it seems that the Affordable Care Act has become the thief. Rather than evaluating the merits (or lack thereof) of the latest proposals to evolve the state of health insurance in this country, proponents (and detractors) are locked in a battle of comparisons to Obamacare.
The very nature of the ACA’s nickname itself makes it difficult to evaluate any new proposal without politicizing the discussion. To be clear, this is happening on both sides of the aisle.
Let’s look at three aspects of the Senate’s Better Care Reconciliation Act to test this hypothesis.
1) Age banding. Prior to the passage of the ACA, it was common for the oldest non-Medicare purchasers of individual insurance to pay six times as much as the youngest adults. The ACA included a mandate that the difference in price could be no greater than three times. The AARP is currently running an ad which claims that the proposed healthcare legislation will impose an “age tax” by allowing insurance companies to charge older consumers five times as much as younger consumers.
The fact is that older individuals, on average, consume more healthcare than younger individuals. And because of this, they tend to value health insurance more. Any attempts to spread their higher costs to younger individuals might result in those same younger individuals opting out of insurance altogether. If younger individuals are not buying insurance in sufficient numbers to have a viable risk pool, it seems that tweaking the price differential is a reasonable course of action.
2) Medicaid expansion vs. subsidized individual coverage. One of the foundational pillars of the ACA was the expansion of Medicaid to all Americans with household incomes up to 133% of the Federal Poverty Level. Individual subsidies were not available to individuals with household incomes below 100% of the FPL. The Supreme Court ruled that the mandated expansion was unconstitutional. As a result, many states chose not to expand Medicaid. This created situations where individuals could not access subsidized insurance either through Medicaid or in the Marketplaces.
According to the Kaiser Foundation, 11.2 million people have gained coverage through expansion of Medicaid. Under the Senate draft, the individual subsidy program is expanded to cover individuals below 100% of the FPL.
The comparison is not whether low income Americans are eligible for subsidized coverage, but rather, where they get that coverage. Most agree that the individual market needs more participants to be viable. Shifting 11 million members seems like a reasonable course of action.
3) Repeal vs. fix. This is perhaps the most onerous comparison that healthcare reform faces. While most politicians (on both sides of the aisle) agree that aspects of the ACA are not working, the inevitable spin is how to characterize the current proposals. Is it “repeal and replace” or is it “Obamacare lite?”
The fact is that the ACA did not create any new insurance markets. Rather, it built upon the existing sources of health coverage for Americans younger than 65: employer, individual and Medicaid.
It did, however, change how federal monies were used to subsidize the purchase of health insurance in each of these markets and changed the requirements for coverage in each of these markets. The question is whether these markets were strengthened because of these changes and whether additional changes are reasonable.
The GOP’s health reform proposal will not be the final answer. However, the comparison game is not helping the overall objective of Americans. The costs of healthcare and health insurance are increasing at an unsustainable rate. The current system needs help. Comparing proposed changes to the ACA not only robs the joy of making things better, it also stands in the way of keeping them from getting worse.
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