Ten years with Obamacare: why it won’t make it to next year


The Affordable Care Act marks its 10th anniversary this year. And ten years later, the law has failed to live up to its name.

The last decade has seen insurance premiums soar and coverage options dwindle for millions of people. The share of Americans without insurance is on the rise, while the nation’s doctor shortage is growing more acute by the day.

Between 2013, the year before the exchanges opened, and 2017, average individual premiums on the HealthCare.gov marketplace more than doubled. Since 2014, average exchange-plan premiums have risen by 70%.

Obamacare ensured premium hikes

The law required insurers to cover 10 ”essential” health benefits, including substance abuse treatment and children’s dental services, even if beneficiaries didn’t want or need them.

The law also imposed a range of new regulations, including guaranteed issue and community rating rules. The former bans insurers from turning away customers because of their age or health condition; the latter prohibits insurers from charging older patients more than three times what they charge younger ones.

The cost of providing essential health benefits didn’t go away just because Obamacare declared insurers had to cover them “free of charge.” Insurers raised premiums and deductibles in response.

A small share of patients account for a large share of medical costs. In addition, claims costs for the old are typically five times what they are for the young. Forcing insurers to offer coverage to all comers and limiting what they can charge high-cost beneficiaries is a recipe for higher premiums and deductibles for most members.

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Even in the face of these rising costs, the law’s defenders have cited a decline in the uninsured rate as proof of Obamacare’s success, a misleading argument.

A substantial portion of the increase in insurance coverage has been via Medicaid. Enrollment in the program increased 26%–nearly 15 million people–between 2013 and 2019. That’s simply proof that Obamacare has been good at spending billions and billions of taxpayer dollars to expand an existing program.

Meanwhile, in the individual market, coverage has become so expensive that Americans who don’t qualify for premium subsidies have fled the exchanges. Between 2016 and 2018, marketplace enrollment among unsubsidized patients dropped 40%. Partly because of this mass exodus, America’s uninsured rate ticked upward in 2018 for the first time since Obamacare became law.

Even those who can afford coverage through the exchanges often have few insurers to choose from. Since 2016, the average number of insurers per state has dropped from six to 4.5. This year, one-quarter of U.S. counties have one insurer offering exchange coverage. Another 46 percent have only two providers to choose from.

Patients are not the only ones suffering under Obamacare. The law has also imposed unreasonable administrative burdens on America’s doctors.

Take the electronic health records mandate, which pushed healthcare providers to digitize their record-keeping. Instead of streamlining healthcare operations, the reform vastly increased the amount of time doctors spend on data entry. On average, physicians now devote six hours of an 11.4 hour workday on electronic health records–more time than they spend with patients.

This brings added stress to doctors

 According to a Mayo Clinic analysis, doctors who use electronic health records are at greater risk of burnout. Roughly half of all doctors report that electronic health records have detracted from their clinical effectiveness, according to research from Stanford Medicine.

Such burnout threatens to exacerbate America’s existing doctor shortage. By 2032, we could be short 121,900 physicians, according to the Association of American Medical Colleges.

This fall, a group of Republican state attorneys general will argue before the U.S. Supreme Court that the entire law became unconstitutional when Congress zeroed out the tax penalty for going without insurance effective 2019.

In 2012, the high court upheld the law as constitutional because of that very tax penalty. Without it, the whole law could come crashing down.

President Obama promised Americans a new era of affordable health care. But costly coverage, millions of uninsured, and a growing doctor shortage are Obamacare’s true legacy.

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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