People have a bad habit of blaming the ACA for insurance prices. The ACA failed at its goal of making individual health insurance affordable, that is true. But it didn't cause that problem, and it did something extremely important to mitigate it.
I know ACA is good for some, but goodness did it remove my interest in remaining insured. I’m sure you can cite data that tells a different story, but my experience, as well as that of my peers, says ACA has been very bad for those actually paying the bill unsubsidized. I fully blame ACA for this.
Rising insurance premiums aren't good for anyone. The ACA set out to fix the problem of rising insurance premiums and (I think) pretty much failed. But it didn't create that problem; 5-digit annual premiums for a family of four were a reality prior to the ACA --- or, at least, they were in Chicago on the small group market.
The subtext to these discussions though is whether we'd be better off without the ACA. No, we would not be. We would lose guaranteed-issue insurance, so a sizable fraction of families wouldn't be able to get insurance at all, and, from the available evidence, we would at least have the same rate problems we have now, and (according to some studies) have worse rates. Obviously, this subtext is about the GOP's health care rhetoric, and I'm not wild about opening up a political salient in this thread, but let's at least be clear: the idea that you can repeal the ACA, do nothing else, and get lower health insurance premiums for real coverage is sleight of hand.
The net bill was over $110k if I hadn't had insurance and wanted to go to one of two ankle specialists in the city I live in. With insurance, $5k-ish.
Before, we had the (very poor) demand elasticity of people paying everything they had and then maxing out every credit source, and predictably prices rose to around that point. Now, we have no demand elasticity at all, and prices can be expected to rise well above the average person's net worth + credit access.
If you look at any microeconomic equilibrium chart, you'll see that the price is held in a balance between people buying and people holding off due to price. When the good is healthcare, the human cost of "holding off" is very high, and usually involves inability to pay. Unfortunately our economic system tends to fly off the rails if this balance is disrupted, no matter how noble or urgent the cause.
Later, after some health issues <cough> first child diagnosed with T1D <cough> we were grandfathered into the private plans and the premiums did not change but the deductible was pretty high and the network was not great.
Later, and this was still pre-ACA - California had guarantee issue health insurance with little or no rating factor adjustment (surcharge) for companies with 2-50 employees. So I hired my wife and we switched to one of those plans. Premiums around $800/mo and $2k deductibles. That was about the time when our 2nd child was diagnosed with T1D.
When ACA passed all CA guaranteed issue small business plans disappeared and everything switched over to marketplace. Silver plans for $2,000/mo for the family and $2,000 deductibles with $12,500 our of pocket max. Basically every spare penny went to healthcare, and then some, and we were slowly drowning in debt because of it.
Finally, I stepped off the treadmill, stopped taking a salary, and we switch to Medicaid. And went from spending $35,000/yr out-of-pocket after tax on healthcare to spending $0.
ACA unquestionably increased premiums and total cost for my family substantially, until I stopped taking a salary and went on Medicaid at which point ACA was a god-send due to Medicaid expansion / cost-sharing reductions.
For a healthy family of 4 ACA is horrifically expensive and acts as an extraordinary tax on middle class families who start earning too much for the subsidies. The marginal effective tax rates are so high, the CBO doesn’t have the guts to publish them with the ACA subsidy phase-out included in the calculations.
However, the fact remains that my health insurance options have generally been worse and more expensive since ACA passed. This year, thankfully, I am on employer healthcare plan instead. Because in my area, with the ACA, there is one provider only, and none of the plans are good, and they're all more expensive than before, and at least 2x what I was paying pre-ACA and with MUCH MUCH higher deductables.
As I see it, the ACA was a very middle-of-the-road policy initiative. Building upon a Republican governor's program, namely Romney's in Massachusetts. It was meant to appeal to and help business as much as uninsured individuals. It was conservative in that it didn't throw out the existing system of insurance; rather, it brought new customers to the existing insurers. Insurers became enthusiastic about increased marketshare.
Law consists of two parts: 1) The law itself, and 2) Paying for it.
Republicans made very clear statements about their primary, number one goal (really, the primary goal of their party and their Federal legislative presence) being making Obama's presidency a one term presidency.
The ACA was passed, in spite of their opposition. But they used their subsequent control in Congress to not pay for an essential component. The law provided two years of compensation to insurance companies for excessive expenses resulting from ACA Marketplace plans. The idea was to provide a buffer -- government security -- while insurers caught up on the population's deferred medical expenses and built an actuarial understanding of the population.
When the insurers sought that compensation, I've been told by a professional working in the industry, they received about 15 cents on the dollar.
Premiums shot up. Companies dropped out. Republicans cited the "failure" that they helped create in the first place.
This isn't the only aspect of the situation, but it's a very significant one.
The ACA wasn't perfect. Work could have been done to improve it. Instead, a lot of political effort went into killing it.
Oh, and as tptacek mentioned, it did bring many costs under more control. Something that benefited group plans such as those provide by employers.
You don't hear so much about that, eh? Or the enormous profits that insurers are reaping, in spite of complaints about the ACA Marketplace plans.
P.S. As I've mentioned before, I'm someone who was denied coverage, at all, outright, prior to the ACA coming into full effect. I had a minor condition that a very well respected surgeon would not operate on, while I was still on a corporate group plan. Risk/benefit favored simply monitoring.
That didn't matter. No insurance for me!
(Fortunately, a professional and personal contact in the industry pulled some strings. Something NOT available to most people.)
P.P.S. I should add that some people think that some insurers may have underpriced their ACA plans a bit, initially, eager to maximize their portion of the increase in market size and relying on the temporary government security for protection. I don't know whether this is true. Even if it is, no law/program is perfect, and the two year timeframe placed an inherent limit on this behavior.
When the repayments came up so short (15 cents on the dollar), this might have magnified the corresponding premium increases somewhat.
But all this was accounted for by the ACA law, including limiting its effect. It just wasn't, subsequently, paid for by the Federal budget process.
And if it is true, it reveals insurer's enthusiasm about the ACA. They wanted the increased marketshare.
Instead of working with this momentum, it was thrown under the bus for political reasons. As I see it.
Another thing-- the data on prices are a flat out LIE, the government is also making massive payments to the insurance companies directly -- their prices don't reflect their actual costs.
No matter what you think about prices, though, the most important thing the ACA did was create a nationwide requirement for guaranteed-issue insurance. However expensive you think insurance is, it's more expensive to be flatly and irrevocably restricted from buying your own insurance at all, which was the status quo ante of the ACA.
https://www.forbes.com/sites/theapothecary/2016/07/28/overwh...
