WASHINGTON
— The Affordable Care Act was conceived as a mix of publicly funded
health care and privately purchased insurance, but Republican attacks,
culminating this month in the death of a mandate that most Americans
have insurance, are shifting the balance, giving the government a larger
role than Democrats ever anticipated.
And while President Trump insisted again on Tuesday that the health law was “essentially” being repealed, what remains of it appears relatively stable and increasingly government-funded.
In
short, President Barack Obama’s signature domestic achievement is
becoming more like what conservatives despise — government-run health
care — thanks in part to Republican efforts that are raising premiums
for people without government assistance and allowing them to skirt
coverage.
By
ending the tax penalty for people who do not have coverage, beginning
in 2019, Republicans may hasten the flight of customers who now pay the
full cost of their insurance. Among those left behind under the umbrella
of the Affordable Care Act would be people of modest means who qualify
for Medicaid or receive sizable subsidies for private insurance.
“Republicans
have inadvertently strengthened the hand of Democrats like me who
prefer richer subsidies to a mandate and welcome the expanded federal
role that will come with those subsidies,” said Joel S. Ario, a former
insurance commissioner from Pennsylvania who worked in the Obama
administration.
In
days, the Trump administration is expected to carry out an executive
order with proposed rules that would allow people to buy less expensive —
and less comprehensive — coverage, through either business and
professional associations or short-term private policies.
The
Affordable Care Act’s success in reducing the number of uninsured owes
more to Medicaid than to private health insurance. About 75 million
people are now enrolled in Medicaid, a number that has increased by
about one-third since the adoption of the Affordable Care Act. A smaller
number, about 10 million, buy coverage from private insurers through
the health law’s marketplace.
Among
people ages 18 to 64, the proportion with private health insurance
coverage is about the same today as in 2005, according to the National
Center for Health Statistics. But the proportion with public insurance
coverage has increased to more than 19 percent, from 11.5 percent in
2005, and the share of people in that age range who are uninsured has
fallen to 12.5 percent, from about 19 percent.
In
total, more than one-third of the population is covered with federal
assistance, through Medicare, Medicaid, the Department of Veterans
Affairs, the military and Affordable Care Act subsidies. (And that does
not include the larger group of people who benefit from tax subsidies
for health insurance provided by employers.)
Mr.
Trump and Republicans in Congress failed this year in their efforts to
cut Medicaid and could try again in 2018. Speaker Paul D. Ryan said this
month that Republicans would try next year to slow the growth of
federal health spending because “it’s the health care entitlements that
are the big drivers of our debt.”
But
Senator Mitch McConnell, the majority leader, has been leery of another
run at health care in an election year, and it is possible that
Medicaid could, in the near future, actually grow further under the
Affordable Care Act. Maine voters approved a referendum last month to
expand Medicaid in that state, though Maine’s Republican governor, Paul R. LePage, is dragging his feet.
Mr. LePage will not be on the ballot in November, when the state could
elect a governor more willing to accept the referendum’s results.
The
governor-elect of Virginia, Ralph S. Northam, has vowed to expand
Medicaid and could have an evenly split House of Delegates, depending on
the outcome of a drawing of lots this week that will decide the winner of a tied race in southeastern Virginia.
A Democratic wave election in November could also shift the balance of power in a few other state capitals.
While
the marketplaces, or exchanges, have struggled with a series of
problems since they opened in 2014, Medicaid, administered by an
experienced corps of state officials, has gone from strength to
strength. Public appreciation for the program has steadily increased as
people come to understand its importance in the health care system,
including its central role in combating the opioid epidemic.
And
though Congress has effectively repealed the requirement for people to
have health insurance, federal subsidies are still available to low- and
moderate-income people who want insurance. The federal government pays,
on average, about three-fourths of the premium for more than
three-fourths of the people who buy insurance through the Affordable
Care Act marketplace.
Insurers
are still required to provide coverage to anyone who applies. They
cannot deny coverage or charge higher premiums because of a person’s
pre-existing conditions. And people receiving premium subsidies are
generally insulated against insurance price increases.
By
contrast, the sharp increases in premiums in many markets this year
have made insurance less attractive and less affordable for
middle-income people who do not receive subsidies. The brunt of premium
increases falls on people who must pay the entire cost themselves — an
individual with annual income over $48,240 or a family of four with
income over $98,400.
Mr.
McConnell says he remains committed to bringing to a vote early next
year two bills to stabilize insurance markets. One would restore
government subsidies to insurance companies to help cover out-of-pocket
expenses for low-income customers. Another would offer money to states
to lower premiums, perhaps by setting up “reinsurance” programs to cover
the highest-cost customers with serious illnesses.
Mr.
Trump appeared to embrace some kind of bipartisan health care
legislation on Tuesday with a Twitter post from his resort in Palm
Beach, Fla.: “Based on the fact that the very unfair and unpopular
Individual Mandate has been terminated as part of our Tax Cut Bill,
which essentially Repeals (over time) ObamaCare, the Democrats &
Republicans will eventually come together and develop a great new
HealthCare plan!’’
But
even with those measures, health policy experts say they expect the
Affordable Care Act’s marketplaces to be populated increasingly by
consumers who qualify for financial assistance or have clear medical
needs.
“It
seems to me that the exchanges will evolve into an extended form of
government coverage very much akin to Medicaid,” said J. B. Silvers, a
professor of health care finance at Case Western Reserve University, in
Cleveland. Increasingly, he said, “those who are not subsidized will
drop out because of the high prices, and those getting the subsidy will
still see great bargains,” after taking account of the subsidies.
When
the Affordable Care Act was passed in 2010, the Congressional Budget
Office expected that the insurance exchanges would be more important
than Medicaid in expanding coverage. The reverse has been true.
“Enrollment
in the exchanges is nothing like what anyone expected,” said Daniel N.
Mendelson, the president of Avalere Health, a research and consulting
company. “Repeal of the mandate will probably serve to take out some
relatively healthy people who think they can coast by without insurance.
What we will have left is a heavily subsidized high-risk pool for
low-income people who are not eligible for Medicaid.”
Medicaid
covers substantially more people than Medicare, the insurance program
for older Americans. Even though only 31 states have expanded Medicaid,
total enrollment is about the same as what the Congressional Budget
Office was predicting in 2010, when it assumed that all states would
expand eligibility under the Affordable Care Act. The Supreme Court
ruled in 2012 that the expansion of Medicaid was an option for states, not a requirement.
Congress’s
decision to eliminate the individual mandate means that healthier
people with less need for insurance are less likely to buy it. The
remaining pool of insurance buyers will have higher costs, on average,
so insurers will increase premiums even more. And when premiums rise,
consumers are entitled to larger subsidies from the federal government
to help defray the higher costs.
In
some ways, Medicaid is more generous than commercial insurers. The
benefits are more comprehensive, and coverage is nearly free, with
beneficiaries required to pay only nominal amounts. While Medicaid is a
government program, most states contract with private insurers to
deliver and manage care.
Among
the few companies that have been successful on the Affordable Care Act
exchanges are insurers like Centene that have experience in Medicaid.
“The
reason so many people are on Medicaid,” said Sara Rosenbaum, a
professor of health law and policy at George Washington University, “is
that so many people have low incomes.”