Will ACA woes lead to universal coverage?
From the pages of In Business magazine.
Back in January, when nobody was paying attention to the fine print, Congress passed and President Obama signed a budget bill that blocked the federal government from covering the losses of medical insurance providers. The obvious motivation of Congress was to prevent another taxpayer bailout, but the measure removed from the Affordable Care Act, aka Obamacare, a key layer of insurer protection. The response to any ACA collapse should be a priority issue in this fall’s presidential campaign.
Even with that protection, the ACA was a difficult challenge for insurers. The law required them to cover everybody, with certain mandated benefits, at an affordable cost, but many have not been able to keep monthly premium rates low enough. The ACA’s subsidies and tax credits only go so far in reducing the bite of premium hikes, and they don’t apply to today’s sky-high deductibles.
As a consequence, insurance rates are becoming more expensive as fewer young and healthy people buy coverage. Insurance pools are getting older and less healthy, which only feeds the next round of premium hikes. The final nail in the coffin of this “death spiral” might have been the aforementioned legislation that prevents the federal government from guaranteeing insurance profits, which now is the subject of a lawsuit.
After losing $1 billion covering ACA patients, UnitedHealthcare has dropped out of the ACA’s health exchanges, and Louisville-based Humana has left several individual markets, including Wisconsin’s. By this fall, in the midst of the presidential campaign, we should get a better idea of how many others will follow.
This development might give presumptive Democratic Party presidential nominee Hillary Clinton the opening she needs to endorse universal health insurance, which is the single-payer model she’s been resisting. It’s certainly one way to win over supporters of primary opponent Bernie Sanders, who unabashedly supports single-payer, and unify the Democratic Party.
How it motivates presumptive Republican presidential nominee Donald Trump, who once expressed support for single-payer, is anyone’s guess. My hunch is that House Speaker Paul Ryan and other GOP leaders will have enough influence over Trump that he would counter Clinton’s approach with some sort of private system.
If this unfolds it’s a debate worth having, and if the past is any guide it’s advantage Democrats. Republicans have rarely done a good job articulating the merits of a private system, and their current standard bearer has been more interested in hurling insults than constructive engagement in policy debates.
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