Making healthcare more accessible and affordable

Overview

Unfortunately, the Affordable Care Act, or “Obamacare,” has failed to deliver on its promise to fix our broken healthcare system.

American Action Forum researchers Tara O’Neill and Conor Ryan detail the progress of the Affordable Care Act Obamacare five years after Congress passed the law, finding that while the law has increased the number of people with some form of health insurance, Obamacare has failed to achieve the original coverage estimates. The quality of health care coverage is also in question, since onerous regulations and higher costs have often limited people choosing their preferred health care option.

American doctor with depressed woman patient

Furthermore, parts of law have cost more per person enrolled than the administration originally estimated. And the overall cost of health care in the United States has bent upward, not downward as President Obama promised.

The report concludes:

Five years after passage, there are few clear indications that the ACA has had its intended impact on cost of care and access to it. Meanwhile, the law costs significantly more than projected…

Going forward, health coverage policy solutions will need to focus on enlisting market forces to lower costs rather than merely subsidizing them.

Keep clicking to read about the problems Obamacare has caused – and ideas that will help Americans have better access to affordable healthcare without the unintended and in some cases disastrous consequences Obamacare has caused.

  • Health insurance is less affordable than before Obamacare was passed

    Despite promises to the contrary, Obamacare has actually caused health insurance to get more expensive for many families.

    CNBC summarized the cost increases expected for the lowest cost Obamacare plans in 2016:

    “People who buy the cheapest health plans on the biggest Obamacare exchange without getting financial assistance are facing the largest increases for premiums and out-of-pocket costs in 2016, new analyses show.

    Average prices of the so-called bronze plans on the HealthCare.gov marketplace are rising 11 percent for nonsubsidized customers over 2015 prices. Average deductibles for individuals are increasing by the same percentage, to $5,731, according to a study by HealthPocket.com, an insurance comparison site.”

    Fortune reports on the almost 7% increase in overall healthcare costs expected in 2017:

    “Health care costs are expected to grow 6.5% through next year. While costs have finally reached a point of equilibrium after years of double-digit growth, they are still expanding far faster than overall inflation, leaving employers and insurers trying to figure out how to stomach the new increases. The answer may not please many consumers.”

  • Obamacare has reduced healthcare choices

    OL Staff recently wrote the following on the negative consequences Obamacare has had on choice:

    “Insurers have significantly limited access to networks of doctors and hospitals as a result of Obamacare, a McKinsey & Co. analysis recently found. After sifting through the regulatory filings for 18 states and the District of Columbia, the research firm discovered that just one quarter of all offerings on Obamacare exchanges will be full service plans, with the vast majority of patients forced onto “health-maintenance plans.”

    Obamacare has forced many consumers into restricted policies with fewer choices

    These restricted policies have much narrower portfolios of health care providers and facilities from which policyholders can choose. The Wall Street Journal notes that in many cases, this means just a single hospital system and its affiliated facilities and doctors.

    McKinsey & Co. also found that, across the states they studied, 15 percent of patients have no Preferred-Provider Organization (PPO) plans in which they can enroll. This has left many families without the robust coverage to which they have become accustomed prior to Obamacare, and many Americans fear they’ll lose their preferred health care team and facilities, creating the potential to disrupt treatment plans, scheduled surgeries and more.

    To make matters worse, the expected changes will not be announced until October when open enrollment begins.

    Learn more about how Obamacare has diminished America’s health care choices at the Wall Street Journal.”

  • Make good on the promise that people who like their insurance can keep it 

    One key feature of many Obamacare replacement plans is allowing individuals who like their healthcare plan to keep it.  In this model, the existing employer-based insurance structure would be maintained, meaning most Americans receiving health insurance would see few changes.

  • Replace Obamacare's exchanges with a refundable tax credit program

    This solution would provide refundable tax credits for individuals who do not receive health insurance through their employer. The credits would increase with age to help offset greater health care costs for older beneficiaries but, unlike Obamacare would not be based on income.  This general approach to helping make healthcare more affordable has been endorsed by many, including AEI’s Agenda for ReformRepresentative Tom Priceformer Governor Jeb Bush, and Senators Burr and Hatch and Representative Upton.

  • Reform Medicaid

    Health care scholar Avik Roy has put together a far-reaching plan to overhaul Obamacare and move it to a fully market-oriented system. Instead of repealing and replacing Obamacare, Roy’s proposal would reform the existing exchanges into a Universal Exchange, with the goal of limiting disruption to insurance markets and consumers:

    “The Universal Exchange Plan would introduce major changes to the broad set of federal health care entitlements: Obamacare, Medicare, and Medicaid. The Plan uses a reformed version of the ACA’s health insurance exchanges as the basis for far-reaching entitlement reform.

    The Plan would repeal many of the ACA’s cost-increasing insurance mandates, including the individual mandate. But it would preserve the ACA’s guarantee that every American can purchase coverage regardless of preexisting conditions. And it would utilize the concept of using federal premium support subsidies, on a means-tested basis, to defray the cost of private health coverage.

    It would gradually migrate most Medicaid recipients, along with future retirees, onto these reformed exchanges. This change would dramatically increase the quality of health coverage offered to Americans at or below the poverty line, and preserve the guarantee of health coverage for low- and middle-income seniors, while ensuring the fiscal sustainability of both federal health care commitments. The Plan proposes minor changes to the treatment of employer-sponsored health coverage, while giving workers additional tools to lower their health care bills. It would curb the pricing power of hospitals, cap malpractice damages, and accelerate medical innovation.”

    Roy estimates that this proposal would help up to 12.5 million more Americans receive insurance coverage than Obamacare while reducing costs.

  • Implement continuous coverage protection 

    Currently, Medicaid groups multiple categories of beneficiaries under one program. Over half of Medicaid costs are actually spent on benefits to seniors who are also eligible for Medicare, or the disabled. Proposals like the one outlined by AEI’s Agenda for Reform would block-grant Medicaid spending to the states into two different funding streams: one for the elderly and disabled, and the other for lower-income healthy adults and children. States could then deliver services to each group in the most effective manner. For example, the Medicaid financing for healthy adults and children could instead be paired with the tax credits described above to buy more effective private insurance plans. States would be given further room to experiment and reform Medicaid’s long-term care programs to better provide services for the disabled and elderly.

  • Expand Health Savings Accounts

    Maintaining a continuous coverage provision would have the dual benefit of keeping healthy individuals in the insurance pool and ensuring those with pre-existing conditions can still receive affordable health care coverage.  Anyone who had maintained at least catastrophic coverage (which would be available to everyone given the refundable tax credits provided) could not be denied health care coverage or have their premiums increased because of a pre-existing condition.

  • Create a "Universal Exchange" to minimize disruption

    Health Savings Accounts (HSAs) have become a popular feature of many health care plans, allowing individuals to save pre-tax dollars to use for qualifying health expenses. A key plank of conservative health care reform is empowering consumers while limiting government intervention, and HSAs are a proven way to do just that. Plans like AEI’s Agenda for Reform would incentivize the adoption of HSAs by providing a one-time federal tax credit of up to $1,000 for every HSA, encouraging millions of Americans to open and contribute to their accounts. The current web of regulations and rules surrounding HSAs under current law (including minimum deductible requirements in order to open one, low maximum contribution limits, prohibitions on seniors with Medicare coverage from using HSAs, and more) would be eliminated. Health care money, now managed mostly by the government and insurance companies, would be in the hands of consumers to use for individual expenses and needs.

  • End the Exemption for Employer-Provided Health Care Insurance

    The U.S. government's third largest health program isn't a program at all — it's actually a tax break.

    American Enterprise Institute health care policy expert Joseph Antos notes the deduction for employer-sponsored health insurance reduces taxes by $250 billion annually and significantly benefits wealthier taxpayers over the middle- and working class. The deduction also skews employee compensation away from cash wages and into health care, while contributing to wasteful health care spending.

    Some sensible reforms on offer include capping or phasing out the employer tax deduction while minimizing the disruption to the employer-health care market.

    Read Antos's case for ending the tax exemption for employer-provided health insurance here.

    Read details of the Patient CARE Act (Hatch-Burr-Upton) here.

    Read details of the Empowering Patients First Act (Price/2017 Project) here.

    Read about the American Health Care Reform Act (Republican Study Committee) here.

  • Grace-Marie Turner
    Champion of free-market reforms to drive down healthcare costs

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    “Consumers are facing the prospect of significant premium increases for health insurance next year and faulty ACA provisions are at ...

    “Consumers are facing the prospect of significant premium increases for health insurance next year and faulty ACA provisions are at least partly to blame.”
    Why They Matter

    From her bio at the Galen Institute:

    “Grace-Marie Turner is president of the Galen Institute, a public policy research organization that she founded in 1995 to promote an informed debate over free-market ideas for health reform.

    She has been instrumental in developing and promoting ideas for reform to transfer power over health care decisions to doctors and patients.  She speaks and writes extensively about incentives to promote a more competitive, patient-centered marketplace in the health sector.

    • She testifies regularly before Congress and advises senior government ...
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  • James C. Capretta

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    “A replacement plan for the ACA must provide access to affordable insurance for all households, and provide regulatory protections for ...

    “A replacement plan for the ACA must provide access to affordable insurance for all households, and provide regulatory protections for persons with pre-existing conditions”
    Why They Matter

    From his AEI bio:

    James C. Capretta is a resident fellow and holds the Milton Friedman Chair at the American Enterprise Institute, where he studies health care, entitlement, and US budgetary policy, as well as global trends in aging, health, and retirement programs. In 2015 and 2016, he directed two major studies: one on reforming US health care according to market principles and consumer choice, and the second on reforming major federal entitlement programs to promote greater personal responsibility, focus limited resources on those most in need, ...

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  • Tom Price
    Former surgeon on a mission to help fix our healthcare system

    Rep. Tom Price, R-Ga., center, flanked by Rep. Mike Kelly, R-Pa., left, and Rep. Mark Meadows, R-N.C., speaks during a news conference on Capitol Hill in Washington, Friday, Aug. 2, 2013, speaks about his bill, the "Keep the IRS Off Your Health Care Act," which the House passed today and targets President Barack Obama's health care overhaul. The bill aims to prevent the Internal Revenue Service from implementing any part of the health care law. It is the 40th time the Republican-controlled House has tried to block the Affordable Care Act, popularly known as Obamacare.  (AP Photo/J. Scott Applewhite)

    "Under Obamacare, the American people are paying more for health care and getting less – less access, less quality, and ...

    "Under Obamacare, the American people are paying more for health care and getting less – less access, less quality, and fewer choices."
    Why They Matter

    Dr. Tom Price was recently appointed by Donald Trump to head the U.S. Department of Health and Human Services.  Before that, he served in Congress, including as the Chairman of the House Budget Committee. From his official bio:

    “Congressman Tom Price was first elected to represent Georgia’s 6th district in November 2004.  Prior to going to Washington, Price served four terms in the Georgia State Senate – two as Minority Whip.  In 2002, he was a leader in the Republican renaissance in Georgia as the party took control ...

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  • Regina E. Herzlinger
    Money magazine named her the “godmother of consumer-driven healthcare”

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    “I'm not just an academic, I am an activist…”

    Why They Matter

    From her Harvard Business School bio:

    “Regina E. Herzlinger is the Nancy R. McPherson Professor of Business Administration at the Harvard Business School. She was the first woman to be tenured and chaired at Harvard Business School and the first to serve on many established and start up corporate health care/medical technology boards. She initiated the courses in nonprofit and health care at HBS and was the first faculty member to be selected by the students as their best instructor. All of her ...

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  • Another Insurer Bows Out of Obamacare

    On the heels of an announcement by United Health that it would suspend its participation in the Obamacare exchanges, Humana, one of the nation’s largest insurance providers, says it, too, plans to abandon the failing program due to a significant drop in enrollment and lower profits. In a statement released …

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  • Ready for Insurance Rate Hikes? You Can Thank Obamacare

    Patients across the country have already endured three years of compounding health insurance costs. Since Obamacare was implemented in 2013, millions of families have seen their premiums skyrocket and millions more have lost their preferred insurance all together. And then, of course, there are those whose Obamacare-compliant private insurance plans …

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  • Report: Companies Will Drop Millions from Health Coverage Due to Obamacare

    Another week, another bad report for President Obama’s signature health law, Obamacare. The report from the non-partisan Congressional Budget Office details how premiums will jump 6 percent in the next ten years while employers will drop employees from health coverage due to ever-rising insurance costs. The Washington Times reports: Obamacare …

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  • 400k Lose Health Insurance in Latest Obamacare Failure

    Democrats are receiving a rude awakening as the future of an Obamacare program comes crashing down. Obamacare co-ops, a liberal effort to create non-profit insurers and help those in need, is doing the just the opposite. Approximately one-third of these co-ops have failed, leaving consumers in the lurch and footing taxpayers with …

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  • Young People are Shunning Obamacare Plans, Opting to Pay Penalty

    One of the key objectives of Obamacare was to increase the quality of health care coverage plans offered by insurance companies, while at the same time keeping the prices down. In order to keep the Affordable Care Act affordable, Obamacare’s insurance market would require millions of young and healthy Americans …

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  • 1.6 Million Americans Left Obamacare in Just Three Months

    Approximately 1.6 million Americans who enrolled in Obamacare from the beginning of 2016 to the end of March have already left the program, according to the Obama administration. The Department of Health and Human Services announced this week that only 11.1 million people were still enrolled in Obamacare. This is …

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  • New Obamacare Costs Right Around Corner for Small Businesses

    Small businesses have been some of the most prominent victims of Obamacare, with the health laws mandates greatly increasing the cost burden borne by employers. In 2016, over 150,000 businesses and 3 million workers will be directly affected by the law’s onerous costs and regulations. Grace Marie Turner of the …

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  • Research Shows Americans Spend More Under Obamacare Even with Federal Subsidies

    With millions of jobs lost, failed co-ops and high costs, the slew of problems continues to grow for Obamacare. Most recently, reports from the Urban Institute indicate that those insured under Obamacare are spending 10% of their paychecks “on insurance premiums and out-of-pocket costs”. While President Obama is waving a slogan of …

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