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ACA Promises and Realities


The healthcare.gov portal…open, for now!

I haven’t written about the ACA before and I most likely will not write about it again. I’m not going to analyze or proselytize. I’m just going to compare some ACA promises and realities and let you draw your own conclusions.

First, President Obama promised many times that if we wanted to keep our plans, we could. Now, we learn that millions of people are losing their plans whether they want to or not. Then we learned that the Obama Administration knew this would happen, even while Obama and others said it wouldn’t.

Jay Carney explains this by saying that first, it’s only 5% of the population, and it was bad coverage anyway, and second, by blaming the insurance companies for canceling the policies.

5% of the population works out to roughly 16 million people in danger of losing their health care coverage. As for blaming the insurance companies, while the ACA did say that nonconforming policies would be grandfathered in, the regulations as written by HHS ended the grandfathered status as soon as anything changed about the policy, including the premium. Since premiums go up annually, the insurance companies had no choice except to cancel the policies.

HHS forecast that up to 67% of people in the individual coverage market would lose their coverage. But they also forecast that up to 64% of people with large employer based plans and up to 80% of people with small employer based plans will also lose their coverage. According to Forbes:

How many people are exposed to these problems? 60 percent of Americans have private-sector health insurance—precisely the number that Jay Carney dismissed. As to the number of people facing cancellations, 51 percent of the employer-based market plus 53.5 percent of the non-group market (the middle of the administration’s range) amounts to 93 million Americans.

The government knew about this estimate, as did the press. Here’s a story from The Hill dated September of 2010:

The Department of Health and Human Services released preliminary regulations in June. They state that plans would lose their grandfathered status if coinsurance and copayments increase more than a specified amount, for example.

According to HHS estimates:

_ 40 percent to 67 percent of individual policies will lose grandfathered status by 2011;

_ 34 percent to 64 percent of large employer group plans (100 or more employees) will lose their grandfathered status by 2013: and

_ 49 percent to 80 percent of small employer group plans (three to 99 employees) will lose their grandfathered status by 2013.

Yet Mr. Carney somehow failed to mention these estimates.

President Obama campaigned on the ACA, saying it would save the average family of 4 about $2500 per year in health care costs. Now, using the latest figures from Medicare actuaries and the same methodology that came up with Obama’s estimated savings, Chris Conover, writing in Forbes estimates that the average family of 4 will see their annual health care costs increase by over $800 dollars. (Incidentally, read the entire article, including the numerous updates for challenges to his figures and his refutation of those challenges. This kind of open give and take is too rarely seen. Whether you like his conclusions or not, he does an excellent job of showing where they came from and why they are valid.)

The ACA was pushed as a means to cover the 48 million people without health insurance coverage. The CBO estimates that once ObamaCare is fully implemented, roughly 30 million people will still lack coverage. This estimate is confirmed by independent studies. At the same time, the US will be spending 621 billion dollars more on healthcare.

Obama claimed that the ACA would not add one dime to the deficit. While CBO analysis so far bears out that pledge, they also conclude that several parts of the law will be hard to enforce, like the reduced payments to doctors under Medicare, and if those portions aren’t enforced, and historically, they haven’t been, then that estimate will change drastically. An independent evaluation shows the deficit increasing rapidly as the ACA takes full effect and lawmakers in Washington fail to implement all the cost cutting measures.

Again, I’m not going to speculate on the future or draw any conclusions about the ACA and whether or not it is a good program. Nor am I going to draw conclusions on the sales job done to get it passed. I will admit that the picture is somewhat bleak, but then again, it is a realistic assessment of the current state of the ACA.

So now, it is your turn. Are you comfortable with the ACA and how it is being implemented? Do you believe that eventually, it will turn out to be a good thing? Do you have any facts/figures to show the more positive aspects of the legislation?  Just as an example, I like that my kids are covered until age 26, but I don’t really consider it a ‘benefit’ because my premiums increased substantially, as did my deductible and co-pay, so I am certainly paying for the extra coverage.

Please share your observations in the comments. Has the ACA helped you in any way? What are we getting for our money?

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