Obamacare Is Officially Not Collapsing

Continuity you can believe in. Photo: Leigh Vogel/WireImage

The Republican Party never made an honest argument for why its health-care plan would make coverage more affordable for most Americans. This was because no such argument existed. Republicans did not oppose the Affordable Care Act because it failed to provide universal access to high-quality health services. They opposed it because the law was passed by a Democratic president; raised capital-gains taxes on millionaires; and provided the poor and middle-class with yet another public benefit that their big-dollar donors didn’t want to subsidize.

And so the GOP lied. Donald Trump, Paul Ryan, and Mitch McConnell attacked the ACA from the left, decrying the plight of the 25 million Americans who were still uninsured — and that of the millions who had insurance they couldn’t afford to use — all while pushing legislation that would increase the number of Americans consigned to both fates.

This worked fine as long as the party could shield its replacement plans from public scrutiny. But once the Congressional Budget Office started giving away the game, the GOP became increasingly reliant on the other pillar of their case for Trumpcare: There is no alternative.

From the beginning, Republicans tried to combat the public’s infamous status quo bias by convincing it that maintaining the status quo was not an option. Obamacare was “collapsing,” “on its last legs,” in “a death spiral.” By May, as poll after poll showed voters preferred the ACA to the GOP alternatives, Obamacare went from “dying,” to “dead” and “gone.”

Such claims were just as mendacious as McConnell’s feigned concern for the uninsured — but decidedly more plausible. After all, the president’s apocalyptic prophesies were buttressed by headlines in the straight (a.k.a. “fake”) news media. Anthem was pulling out of Obamacare in Wisconsin and Indiana; Iowa lost the last insurer still participating on its exchanges; as of early June, nearly 50 U.S. counties had Obamacare “marketplaces” without a single seller.

Meanwhile, Trump did what he could to make his prophesies self-fulfilling. The president routinely threatened to cut off subsidies to insurers, while his Department of Health and Human Services actively discouraged Americans from seeking insurance through the exchanges. And, of course, congressional Republicans created perpetual uncertainty about Obamacare’s near-term survival.

Expert analysis had consistently contradicted the GOP’s Obamacare doomsdaying. But for a while there, one might have worried that the experts had failed to account for the power of sabotage. The Affordable Care Act may not have been “collapsing,” but perhaps it was undergoing controlled demolition.

It’s now clear that this fear was misguided. Obamacare has proven strong enough to withstand judicial challenge, legislative attack, and administrative sabotage: On Thursday, America’s last “bare” county finally found an insurer for its exchange, as CareSource agreed to provide coverage to the good people of Paulding County, Ohio.

The source of Obamacare’s resilience appears to be twofold:

(1) Even in red America, state-level officials did not want to see their health-care markets fail, and they worked to convince insurers to cover less desirable areas.

(2) Being the only insurer in a county’s Obamacare marketplace is a sweet deal.

This last point was likely the most significant. As Vox’s Dylan Scott explains:

[Obamacare] provides financial assistance for people making 100 percent of the federal poverty level (about $12,000 for an individual) up to 400 percent (about $48,000). It caps the premiums that people have to pay at a certain percentage of their income; the less money you make, the lower the premium you have to pay.

So in an empty county, where an insurer doesn’t have to worry about a competitor undercutting them, companies can set premiums to cover their costs without worrying that they’ll price their coverage too high for many of their customers. It’s going to be the federal government, not a person with a subsidy, picking up much of the extra cost.

Anytime one insurer decides to leave a county fully abandoned, another will see an opportunity to establish a federally subsidized monopoly in its place. This is, of course, a less-than-ideal way to prop up an insurance market. While Uncle Sam ensures that low-income people can afford insurance in single-provider counties no matter the price, those right above the cutoff for subsidies ($55,000 for an individual) aren’t so lucky. And enabling insurers to operate free from competition doesn’t exactly help slow the growth of health-care costs (or that of the national debt).

But these defects are of little political use to Republicans, who boast no viable remedy for any of them. The GOP’s best argument for replacing the ACA with Trumpcare was that the former was on the verge of death and had to be replaced with something. Trump tried to make this true. Nevertheless, the ACA persisted.

Obamacare is not collapsing. But the GOP’s case against it has been reduced to rubble.

Obamacare Is Officially Not Collapsing