THE ANGST over the Obamacare rollout has obscured two truths: First, the computer glitches — while deeply embarrassing — are a tech problem that is fixable. Second, the cancellation of some Americans’ insurance policies and premium hikes for others reflect longstanding problems in the health care system that weren’t suddenly caused by the Affordable Care Act. The great advancement in Obamacare is that it finally provides a framework to address these flaws.
Thus, every issue that the implementation of Obamacare raises should be debated with an eye toward the tradeoffs inherent in any health reform. Fixes can then be made. This should be simple, but Obama’s Republican critics are sticking to a strategy of blaming the health law for the very problems it aims to solve.
Take, for instance, the people whom Texas Senator Ted Cruz has cited as losing their coverage. To hear Cruz tell it, these families’ needs were comfortably being met until Obamacare stuck the big hand of government into the relationship. In fact, the people in question had threadbare coverage, and faced potentially dire consequences if they became seriously ill. Cruz and some other conservatives see this as a matter of choice: If people want minimal coverage, they should be able to buy it. But Cruz must then defend the outcome — less care, or no care, if the person develops a serious illness. Otherwise, the patients will get the treatment, and the rest of the public will get the bill, one way or another.
Here’s a further primer on some of the claims that are ricocheting around cable TV:
What happened to the promise that, if you’re satisfied with your health insurance, you can keep it? In most cases, you can. But the Affordable Care Act also insisted that plans meet certain baseline standards of care — so insurers don’t limit treatment for serious illnesses.
What happens to those whose policies prove inadequate? They — or their employers — have to buy adequate ones. But keep in mind: Health literature is full of horror stories of people who bought policies with large-sounding limits on lifetime care — often in the hundreds of thousands of dollars — and assumed they were adequately covered. But major illnesses like cancer, stroke, and heart disease often cost more. So, families can quickly reach the coverage limit and find themselves impoverished. Then, the costs get sloughed off on the public. That’s why people shouldn’t be able to hide behind cheapo plans.
So then it’s correct to say that Obamacare is driving up the cost of insurance? Not really, because the coverage isn’t equivalent. A relatively small subset of people who have been inadequately insured will have to pay more, but they will get far more for their money.
What about those healthy young people in their 20s and early 30s who are seeing higher premiums on the individual market? Indeed, premiums for young people buying insurance on their own may well go up, because the Affordable Care Act prevents insurers from cutting older, sicker people out of the group; that’s the principle of insurance, and is part of almost every employer-based plan.
There are several mitigating factors here. First, young people can now stay on their parents’ plans until 26, rather than 21. That’s five years in which young people don’t have to buy insurance at all. Second, today’s young people are tomorrow’s middle-aged buyers: The typical 28-year-old whose premiums are higher now will find it much easier — and cheaper — than before Obamacare to buy insurance on the individual market when he or she is even a few years older.
This is largely because people’s health needs grow significantly as they age. Some early reform proposals sought to solve this problem by allowing people between 55 and 65 to buy into Medicare. That would have been cost-effective, because Medicare’s reimbursement rates are pegged by law to the actual cost of the care, not the going rates charged by hospitals and drug companies. But providers and insurers joined forces to fight that one off, and people ages 55 to 65 ended up in the same coverage pool as young, healthy folks.
Still, if premiums under Obamacare rise in unexpected ways, or if the burden on young people seems too excessive, Congress can easily adjust the law to allow insurers to shift more of the burden onto older customers. The strength of the Obamacare framework is that it’s adjustable, just like the Massachusetts plan has proven to be. Congress can and should change the rules as needed.
But that isn’t likely to happen, because Republican opponents have used their power to block any changes, hoping that any problem that arises will help erode confidence in the entire law. Then they can declare, as they tried in 2012, that the law is so broken that it has to go. And then the country will be left with the pre-Obamacare status quo. At the very least, Obamacare’s critics should either defend that status quo, or say what they’d do instead.