Is the new health-care law what anyone really wants?

Now that the House Republicans have presented their long-awaited plan for repealing and replacing the Affordable Care Act, it is a good time to add another “re” word to the national dialogue: reflecting. 

Marianne Udow-Phillips

Marianne Udow-Phillips is executive director of the Center for Healthcare Research & Transformation, a non-partisan health policy center based at the University of Michigan.

As the Republicans’ American Health Care Act moves through the legislative process, policy makers should compare the American health insurance markets before the ACA to where we are now when deciding where to take the insurance markets next. And, it is crucial for them to understand what many of the citizens calling for the law to be “repealed and replaced” likely mean by that phrase.

Then and now: Health insurance in Michigan

Before the ACA, more than 12 percent of Michiganders – more than 1 million people – were uninsured. In 2015, the most recent data available following the ACA’s coverage expansions, only 6.1 percent of Michiganders (nearly 600,000) were uninsured, cutting the percentage of uninsured citizens in half.

Despite some pundits’ fears, for the most part, employers did not drop coverage as a result of the ACA. In fact, while small employers (less than 50 employees) were dropping coverage at high rates prior to the ACA (which is one reason the ACA was passed), the rate of decline in small employers offering coverage moderated since the ACA’s implementation, leveling out at just above 30 percent (although down from over 50 percent in 2002).

And, despite the widespread publicity in the fall of 2016 about individual market destabilization and issues in many parts of the country, Michigan continued to have a robust, competitive individual market in most areas of the state with many health plans and product offerings, with 167 marketplace plans, according to the state’s Department of Insurance and Financial Services.

And, premiums in the most recent individual market open enrollment were competitive, with an average and in fact, somewhat lower than in the employer market.

 

Source: Kaiser Family Foundation: How ACA Marketplace Premiums Measure Up To Expectations/2016 Employer Health Benefits Survey

As a result of the ACA, the individual market in Michigan saw considerable growth compared to before the ACA’s coverage expansions began in 2014.

 

Source: Kaiser Family Foundation, U.S. Department of Health and Human Services

Given this picture, which seems largely favorable, what is it that people mean when they say that they want to replace the ACA? For consumers in Michigan and throughout the country, deductibles have increased substantially since the pre-ACA days.

 

Source: Medical Expenditure Panel Survey, Insurance Component

And, in a national survey, when asked about priorities for an ACA replacement plan, consumers overwhelmingly (67 percent) reported wanting the top priority to be lowering the cost of health care. Thirty-seven percent wanted the law repealed, and 35 percent wanted federal spending on health care to decrease, and the role the government plays in health care to similarly decrease.

Bottom line: When most people in Michigan and nationally say they want to “repeal and replace” the ACA, they do not necessarily want to lose coverage or return to the pre-ACA world. They believe that the ACA has not done enough to lower consumers’ health care costs.

As with the ACA, there are winners and losers in the American Health Care Act. In general, winners include the young and healthy; the well-off, who would get significant tax benefits from the act’s proposed changes; and those less likely to need health insurance. The older, sicker and lower income would face higher costs and/or less coverage.

This week, the nonpartisan Congressional Budget Office estimated that under the AHCA, 14 million people will lose coverage in 2018. The number of uninsured rises to 24 million by 2026. Analyses published since the House Republicans unveiled the AHCA – from Forbes Magazine opinion editor Avik Roy and the non-partisan financial services company Standard and Poor’s to the nonprofit public policy organization The Brookings Institution – reached similar conclusions before the CBO released its score.

It seems that proponents of the AHCA are not listening to the message that citizens in Michigan and nationally are giving policy makers: fix the ACA so that it can provide better quality, more accessible and lower-cost health coverage.

A bill resulting in 14 million Americans losing coverage in 2018 is not what citizens are asking for.

Bridge welcomes guest columns from a diverse range of people on issues relating to Michigan and its future. The views and assertions of these writers do not necessarily reflect those of Bridge or The Center for Michigan.

About The Author

Marianne Udow-Phillips

Marianne Udow-Phillips is director of the Center for Healthcare Research & Transformation and a former director of the Michigan Department of Human Services.

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Comments

Richard Jaissle
Sun, 03/19/2017 - 8:24am

What a Mess! The Republicans want so desperately to do away with the ACA (“Obamacare”) that they seem hell-bent on building another Frankenstein’s monster of a market-based health insurance system. Their ideologically-driven resistance to “Entitlements” blinds them to the fact that the best way to efficiently and affordably insure all Americans’ health care is through a single-payer system ala Medicare. The weakness of the ACA is that it, too, is a market-based system. John Conyers has introduced HR 676 the Expanded and improved Medicare for All Act that not one single Republican Congressman has the courage to co-sign. Please contact your representative and encourage him or her to do what is best for us and not what’s best for the insurance companies by cosigning HR 676. For more information on organizations supporting a single-payer system, please go to Physicians for a National Health Program at www.pnhp.org and to Health Care Now! at www.healthcare-now.org. Together we can join the rest of the civilized world and recognize health care as the human right it should be. After all, isn’t it a bit hypocritical to say that health insurance should either be a benefit of employment or something we can simply choose to shop for and then say that no one should be denied acceptance to the emergency room because, after all, we are a compassionate nation? If we are compassionate enough to not turn away the uninsured from the emergency room, then let’s ensure that all Americans can have access to the care that helps them avoid the emergency room. Then we can call ourselves compassionate.

Jay
Sun, 03/19/2017 - 12:20pm

Richard, how much more in taxes are you willing to pay for Medicare for all? Oh, but I suppose you'll say to tax the rich more. So someone succeeds at building a business and they should be taxed heavily to pay for someone else's insurance? If you want socialized health care, move across the border to Canada. It's unsustainable in the long term for any government controlled health care system to operate without huge tax increases on everyone. What's the point of building a business and making money when the government will take 50% or more of your income to pay for insurance for people that don't work and contribute to the economy? Obamacare has maybe two more years before it caves in on itself. It's not sustainable and neither would a Medicare for all be sustainable either.

Jay
Sun, 03/19/2017 - 8:28am

I'm unemployed and Blue Cross was charging me $340 per month with a $10,000 deductible. Obamacare is nothing but a farce because it forces people to buy phantom insurance. I couldn't afford to keep paying for Blue Cross so I dropped it and took a partial penalty. Tell me how it's affordable to pay $340 per month and then have to spend $10,000 before the insurance kicks in? Whoever says Obamacare is a good plan is surely high on more than drugs.

Rich
Sun, 03/19/2017 - 8:59am

The ACA and the replacement plan seem to be centered on how many people are insured. I'm not sure I'd be able to say I was insured if I had a plan but could not afford the deductibles or co-pays.

What I have not seen in any plan is an emphasis on health care cost. For starters, we should be looking at transparent pricing, where the cost of any procedure or item is independent of what insurance you have, and all pay the same for that procedure or item. We should be looking at methods of cost reduction such as the support for Nurse Practitioners and more urgent care facilities to help those with minor illness. We should question why so many doctors, especially those in single or small practices retired rather than face the costs imposed by the ACA. The government should be involved in negotiating both the cost of drugs and the effectiveness or result of using them.

When someone gets behind a common sense approach to medical care, then I will become excited about backing something.

Kevin Grand
Sun, 03/19/2017 - 11:12am

Wow!

I get blocked by The Bridge's spam filter, yet there still are readers who don't care for Obamacare NOR the American Healthcare Act.

"Conformational bias" at The Bridge?

Naaaaahhhhhh!

Nancy Derringer
Sun, 03/19/2017 - 5:14pm

Kevin, 

No one is blocking you. Our new commenting system requires each one to be individually approved, and it's Sunday -- I and the others who do this are simply not at the keys all day, as we would be during the week. 

John S.
Mon, 03/20/2017 - 10:46pm

I'm afraid that the ACA demonstrates that the demand for health care insurance (especially for the young and relatively healthy) is far more elastic than its advocates thought. Looking at the high out of pocket expenses from deductibles and co-pays, and even with a subsidy, it was "no sale." Adverse selection took hold with insurance companies realizing the need for ever higher insurance premiums, making the policies even less attractive. The AHCA does recognize that the demand for health care insurance is more inelastic for older persons. They will pay more for it than young persons, even though they may not want to. It would seem that young people have enough financial burdens (e.g., student loans, expenses of starting a family). They pay Medicare taxes like every other working persons. Should they be required to purchase health insurance policies where benefits go mainly to older persons? Single payer has the advantage in that society recognizes its obligation to provide health care to all its citizens. It would sharply reduce administrative costs. A single payer can more effectively control costs. It can be paid for through a mix of taxes--general revenues (ideally from a more progressive income tax), payroll tax, financial transactions tax, and others. It would allow employers to get the monkey of health care insurance off their back. There are problems with single payer, but it's not the broken system that exists in this country.