Once again, it appears that reports of Obamacare’s demise have been greatly exaggerated. After Republican efforts to dismantle the Affordable Care Act died in the Senate last year, the Trump administration doggedly pursued regulatory reforms designed to weaken state-based marketplaces, where individuals can shop for subsidized, private health-insurance plans. But on Tuesday, Vox’s Sarah Kliff shared some surprising news: “Two years into the Trump administration, more health plans are signing up to sell coverage. Premiums for mid-level plans actually went down 1 percent. This is after years of double-digit increases, many under the Obama administration.”
Republicans’ multipronged attack on Obamacare began on President Trump’s first day in office; while GOP legislators were unable to implement plans that would have shunted people with preexisting conditions into an expensive, “high-risk” insurance pools, the Trump administration’s efforts appeared to be more successful. As Washington and Lee University School of Law professor Timothy Jost noted in an August report for the Commonwealth Fund:
Some Trump administration actions have clearly undermined ACA initiatives. A recent Government Accountability Office report, for example, criticizes the administration for greatly scaling back ACA outreach and education programs, including funding for the navigators who help consumers find coverage. The administration’s termination of reimbursement payments to insurers for reducing cost-sharing for low-income enrollees threatened to destabilize the ACA markets, although swift reactions by state regulators averted chaos. The Trump administration has also effectively ended the SHOP small business marketplace program.
The Trump administration also rolled back Obamacare’s contraception mandate, which requires employer-provided insurance plans to cover birth control, and shortened the open enrollment period. And Trump approved one legislative blow that congressional Republican managed to slip into their massive tax bill. When Trump signed the bill into law last year, he eliminated Obamacare’s individual mandate, which levied a fine on individuals who did not purchase health insurance.
These efforts continued this year; in August, the administration finalized a rule allowing the sale of short-term health-insurance plans, which offer lower premiums for coverage that lasts up to 364 days. These plans, which the Obama administration limited to 90 days, aren’t subject to the same regulations that govern coverage provided by an employer or purchased through a marketplace. Short-term plans can discriminate on the basis of preexisting conditions and don’t have to cover maternity care, mental-health care, or prescription costs, among other needs.
For its part, the administration billed short-term plans as an affordable option for people facing rising health-care costs. “This action will help increase choices for Americans faced with escalating premiums and dwindling options in the individual insurance market,” the Department of Health and Human Services announced in a press release. In other words, the Trump administration destabilized the marketplaces and, after premiums increased, enacted rules that essentially allowed insurance companies to market cheap, inadequate plans to consumers in need. One man told USA Today that he’d received a $35,000 bill after he underwent surgery for a kidney stone — and it wasn’t yet clear if the provider of his short-term plan intended to contribute anything at all to the cost.
Despite all this, Obamacare has survived and its marketplaces may now be stabilizing. Chris Sloan of Avalere Health and Larry Levitt of the Kaiser Family Foundation told Kliff that Obamacare’s tax credits, which help subsidize premiums for plans purchased from the marketplace, encouraged consumers to remain enrolled. And while enrollment is down overall, it doesn’t appear that the repeal of the individual mandate had much to do with it. Kliff posits one plausible explanation: as unemployment drops, more people get health insurance through their employers. It’s also likely that Obamacare enrollment will drop further as more states expand Medicaid; in that case, the ACA would still be achieving its goal of expanding health-care coverage. Consumers, it turns out, may not need a push in the form of an individual mandate to seek insurance. If affordable options exist, people will purchase them. A poll this spring found Obamacare’s popularity was at a record high of 54 percent, and running on health care proved to be a successful strategy for Democratic candidates in the midterm elections.
Obamacare remains flawed in certain respects. Premiums are still expensive, and while Medicaid expansion is vital, state expansion programs can still leave middle-class families in precarious territory, as some make too much to qualify for Medicaid but not enough to bear health-care costs with ease. Obamacare’s stabilization reinforces its position as a starting point for more expansive reforms — and highlights the Trump administration’s failure to devise an acceptable alternative.