During an event at his Florida golf course, the former reality TV star suggested that all of his “employees are having a tremendous problem with Obamacare.” However, the club’s general manager later clarified that at least 95 percent of employees are insured by the company. — Raw Story
Well, not all his employees — 5%. See the difference?
“All of my employees are having a tremendous problem with Obamacare,” Donald Trump said today, which is odd because under the law, Trump should be providing health coverage to his employees, at least the full-time ones. That means that the actual problems with the Affordable Care Act don’t affect them.
But it’s fair to say that the Republican presidential nominee is not the only one laboring under misconceptions about what the ACA is, how it works, what its genuine problems are, and how they might be fixed. In fact, most people don’t understand the law, and given how complicated the topic of health insurance and health policy is, you can’t blame them. So I’m going to try to offer a little context and perspective on the latest news about the ACA, in an attempt to get us all on the same page.
As you may have heard, the Obama administration announced yesterday that premiums for certain plans on the ACA exchanges will rise in 2017 by an average of 25 percent. This is a serious problem, and in a moment I’m going to talk about how it can be addressed. But before we get to that, it’s important to understand that almost everything you’ll hear about this news from Republicans is either completely false or misleading.
They want everyone to believe two things: First, that the administration just announced that premiums — your premiums, everybody’s premiums — will rise by 25 percent. Second, that this is proof that the ACA is a disaster and must be repealed. Both those ideas are false.
Here are some key things to understand:
This 25 percent average premium increase only applies to fewer than 2 million Americans. If you have employer-sponsored coverage, this isn’t about you. If you have Medicare or Medicaid, this isn’t about you. If you got your insurance on the exchanges but your income was low enough to qualify you for subsidies, this isn’t about you. It only concerns those people who get individual coverage on the exchanges but don’t qualify for subsidies — 15 percent of those on the exchanges. According to the government’s figures, that’s fewer than 2 million people, or about one half of one percent of the American population.
The exchanges are only one part of the ACA. The ACA’s supporters often point out all the good things that the law includes, and for their part Republicans will try to assure people that they support those things too. But one of the ironies in this debate is that because everyone says they’re in favor of a provision like the ACA’s ban on insurance companies denying coverage because of pre-existing conditions, there’s no controversy or argument about it, and it gets ignored. As Michael Grunwald recently observed, “The perks of Obamacare — insurance protections for Americans with pre-existing conditions, a ban on insurer caps that limited payouts to expensive patients, delivery reforms that have helped produce the slowest cost growth in half a century — have been mostly uncontroversial and undiscussed.”
But if Republicans were to succeed in their goal of repealing the law, all that stuff would disappear too, and we’d be back where we started — not to mention the fact that 20 million Americans would lose their coverage.
We can address this problem if we’re willing to. The exchanges are not working as well as we had hoped, but there are changes we could make that would bring more insurers in and restrain premiums. This morning I asked Paul Starr of the American Prospect, one of the country’s foremost academic experts on health policy, what kind of changes would help bring down premiums on the exchanges. He offered this list:
- Require all insurers who want to sell in the individual insurance market to offer their plans through the exchange, so they couldn’t cherry-pick individuals outside the exchange (this is an idea championed by Henry Aaron of the Brookings Institution).
- Reduce the waiting period for those on disability insurance to get Medicare coverage from two years to six months to move some of the very high-cost enrollees out of the individual-market pool.
- Require any insurer that wants to offer a Medicare Advantage plan in an area also to offer a plan in the marketplace for under-65 enrollees.
- Have the federal exchange adopt the procedures used by California in actively bargaining with plans instead of acting as a passive clearinghouses.
- Create a public option for those aged 55-64 clearly identified as an early buy-in to Medicare.
- Create a second federally run public option for enrollees from 18 to 54.
- Restore the risk corridor and reinsurance provisions that have expired that were intended to protect exchange plans against adverse selection.
These kinds of changes are meant to expand the risk pool to include both healthy and sick people, keep as many insurers in each marketplace as possible, and further increase competition via a public option — all of which might help to keep premiums down and make the exchanges work better. You might disagree with some of them, and some might have a greater effect than others. But the point is, the problems the exchanges are having aren’t so intractable that we just have the throw up our hands and toss the whole thing in the trash.
There is a difference between large rate hikes that affect just half of one percent of us — and can be fixed — and large rate hikes that affect everybody, as Trump claimed.
From the White House:
- Open Enrollment on the Health Insurance Marketplace begins on November 1 and ends on January 31; the deadline for January 1 coverage is December 15. Consumers can visit healthcare.gov to window-shop and compare health insurance plans for 2017.
- We have made tremendous progress thanks to the ACA. The law has improved coverage and lowered costs for the more than 80 percent of Americans already insured before the law was passed. And, it has expanded and improved coverage options for another 10 percent of Americans, dropping the uninsured rate to the lowest level on record.
- In 2017, 72 percent of Marketplace consumers will be able to find a plan for less than $75 a month. Financial assistance blunts the impact of premium increases for most people.
- Shopping around can save Marketplace consumers money. If every returning consumer nationwide selected the lowest cost plan within the same metal level they picked last year, average premiums paid would fall by $28 per month – 20 percent – compared to 2016.
- Marketplace consumers will be able to choose from an average of 30 insurance plans.
- Around 80 percent of Marketplace customers can choose from two or more issuers. Before the ACA, millions of Americans had no choices because of pre-existing conditions.
- And for those with employer-sponsored health insurance, plan choice is typically narrower; in 2015, 30 percent of people with employer coverage had one plan option.
- For the roughly 150 million Americans who get coverage through their employer – nearly 10 times more than the number of people in individual market coverage – premium growth remains much lower than in the past.
- Had premium growth since 2010 matched the average rate over the preceding decade, the average premium for family coverage would have been nearly $3,600 higher in 2016.
- Still, there’s more we can do to help, especially if Republicans stop obsessing over repeal. As the President has always said, we are open to working across the aisle on common-sense ways to strengthen the ACA, and the President has put forward his own ideas:
- The remaining 19 states should expand Medicaid, extending coverage to four million more Americans.
- Congress should increase financial assistance for young adults and middle-class families.
- Congress should act to offer a public health insurance plan in parts of the country still lacking in competition.
- Congress should continue to address increasing drug costs, for example by acting on the ideas put forth in the President’s budget.
- States should use the ACA’s innovative tools to design structures that work best for their residents.
Give us a Democratic Congress and we’ll get this done.
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Selling a soybean contract short is worth two years at the Harvard Business School.~Robert Stovall
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