5 Charts That Prove Obamacare Is a Success

Nearly a full year has passed since the launch of the Affordable Care Act’s cornerstone provision: the individual insurance exchanges, which were designed to allow consumers to comparison-shop for health insurance policies in online marketplaces, where their collective bargaining power theoretically fosters competition and drives down prices. That year saw both huge failures and notable successes for the healthcare reform. Software glitches and design flaws plagued the rollout of the technical infrastructure designed by federal contractors, including the federally facilitated exchanges created in states that chose to not participate in design of their own marketplaces. But even though these issues kept insurance enrollments extremely low in the exchanges’ first six weeks of operation, by the end of the six-month enrollment period, the administration’s target data has indicated that the number of uninsured Americans had significantly decreased during the first half of 2014.

But what did not change was public opinion. Survey data continues to show how politically charged the Affordable Care Act remains and suggests that the Republican-led movement to repeal, defund, or otherwise dismantle the healthcare reform law may still have some political capital. Since its very inception, the healthcare reform has experienced extremely negative views, and generally public opinion has not moved significantly in the past year. The August/September Health Tracking Poll conducted by Kaiser Family Foundation found that Americans are more likely to hold an unfavorable view of Obamacare than a favorable one. Thirty-five percent of the American public sees the healthcare reform law positively, while 47 percent see it negatively.

While the share viewing the law unfavorably is slightly down from July’s 53 percent, the public’s negativity remains little changed from levels recorded at the beginning of the year, when Washington was still apportioning blame over the flawed implementation of the exchange system. But still, even though more Americans see the law as problematic, nearly twice as many say they want their Congressional representative to work to improve the law as they say the law should be repealed and replaced.

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It has been argued — and soundly — that repeal appears to be an untenable position for the Republican party. The future of the Affordable Care Act is stabilizing; President Barack Obama knows it and Republicans facing reelection or challenging Democrat incumbents in November’s midterm congressional elections are beginning to realize it as well. After all, with eight million Americans enrolled in individual insurance plans purchased through the Obamacare exchanges — and about 4.8 million people signed up for Medicaid thanks to the reform’s optional expansion of eligibility, with three million young people are covered by their families’ plans — the healthcare reform would be no easy matter to unravel. But even while the foundations of Obamacare stabilize and the reforms becomes more closely intertwined with society, the fact that the public opinion remains far from positive could potentially impact further implementation progress. Kaiser’s poll found that “healthcare” ranks second to “economy/jobs” as the most important issue in November’s upcoming Congressional midterm elections.

There are still Obamacare horror stories. On Monday, The New York Times reported that healthcare costs can skyrocket during trips to the emergency room, when the doctors who provide the care are out of the patient’s network — even if the hospital is in network. Limiting networks to few doctors and hospitals was one method used by the writers of the Affordable Care Act to keep costs low. Still, despite the negative trends in public opinion and the political spark the healthcare reform provides, data from a variety of sources suggests that the Affordable Care Act is a success, at least, for now.

The Uninsured Rate Has Dropped

Gallup

Source: Gallup

The Affordable Care Act aimed at improving access to healthcare, primarily by enabling a greater number of Americans to be insured thanks to subsidies granted by the federal government. Data collected between January 3 and June 30 from Gallup-Healthways Well-Being Index proves that a greater number of Americans have insurance coverage than before the exchanges went live. The affordability and accessibility that the Obamacare insurance exchanges brought to the individual market has decreased the uninsured rate in the United States from its third-quarter 2013 peak of 18.0 percent to 13.4 percent in the second quarter of this year.

Data from Commonwealth Fund, the Rand Corporation, and the Urban Institute do not match Gallup’s numbers exactly, but all tell a similar story: somewhere between 10 million and 12 million additional Americans have insurance thanks to the subsidized insurance sold on the exchanges, the expansion of Medicaid in a number of states, and the provision that allows Americans under 26 years old to remain on their parents’ insurance politics. Hospitals report admitting fewer uninsured patients.

However, it is important to note that the number of uninsured Americans did not decrease uniformly across the United States. Gallup’s results revealed a sharp divide in the declining number of uninsured residents between the states that left changes insurance changes to the federal government and those that expanded Medicaid and created their own insurance marketplaces. On average, the insurance rate in the 21 states and the District of Columbia that have implemented both measures fell from 16.1 percent in 2013 to 12.1 percent in the first half of the year — a decline of 4 percent. By comparison, in the remaining states that took only one or neither of those actions, the uninsured rate dropped from 18.7 percent to 16.5 percent — a decrease of 2.2 percent.

More Insured Americans Is a Good Thing

To argue that people are better off with health insurance is no stretch. But, it is no simple matter to reform the healthcare system so that more Americans have access to better care at lower costs. Healthcare economists have argued that it is impossible to make the healthcare system more universal, to improve quality, and to also reduce costs.

Together, access, care quality, and costs are known as the iron triangle of healthcare — a relationship defined by the geometry of that shape. Just as a triangle’s legs can be lengthen if another side is shortened, one or “perhaps even” two of those components of healthcare can be improved, those improvements have to come at the expense of a third, as Aaron Carroll MD, MS, director of Indiana University’s Center for Health Policy and Professionalism Research, noted in a 2012 blog post. Therefore, to ensure a healthcare system can achieve better outcomes, costs will increase or some change in access will be required.

The Affordable Care Act aimed at improving access; enabling a greater number of Americans to be insured through subsidies granted by the federal government. While the law also sought to bend the cost curve of healthcare spending over time, its most important focus was lowering the uninsured rate in the United States.

Definitive research on how the Affordable Care Act’s expansion insurance coverage will improve overall health is years away. But there is some data available. A major study of Medicaid, based on data from Oregon, found that people who are insured are less likely to suffer from financial distress and are significantly more likely to report better mental health. What that study did not explain was whether patients ended up healthier, and therefore the value of those findings were much debated. However, subsequent research suggests that physical health of a population will improve after an expansion of insurance coverage. A study conducted by the Annals of Internal Medicine — using data from Massachusetts after its 2006 healthcare reform, on which Obamacare was largely based — suggested that not only did economic security and mental health stabilize, but also people were less likely to have severe health problems and were more likely to avoid premature death.

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Source: Annals of Internal Medicine

Benefits of Obamacare Marketplaces Outweigh the Costs

The technical glitches the prevented potential insurance consumers from enrolling was embarrassing for the Obama administration, but the problems did not derail overall enrollments; the administration’s original target of 7 million was still surpassed. What was more detrimental to the integration of the Obamacare marketplaces into the United States insurance infrastructure were the mass cancellation of policies that did not comply with Obamacare’s new standards and the phenomenon known as “rate shock.”

Last fall, insurance companies across the country have sent cancellation notices to million of people with private plans, informing them their coverage would be terminated at the end of the year. As originally written, the healthcare reform law stated that policies in effect as of March 23, 2010 would be “grandfathered,” meaning consumers will be allowed to keep those policies even if they do not provide the ten mandatory benefits that all health insurance plans are required by the Affordable Care Act to provide. But then, the Department of Health and Human Services wrote regulations that narrowed that provision; now, if any part of a policy was significantly changed since that date — including the deductible, co-pay, or benefits — the policy would not be grandfathered.

Plans that do not offer the added benefits cannot be sold any longer, even if they are cheaper. As former White House spokesperson Jay Carney described the change in that the Affordable Care Act eliminates “substandard policies that don’t provide minimum services.” These cancellations came despite the fact that when campaigning for the Affordable Care Act, the president pledged: “If you like your doctor, you can keep your doctor. If you like your current health insurance plan, you can keep it. Period.”

Before policies were cancelled en masse, the concern that rang the loudest among Obamacare critics was that the reform’s “insurance for everyone” approach would drive up premiums astronomically. When insurance companies began sending out termination notices, Republicans argued these insurance consumers would experience “rate shock” as they looked for new policies on the exchanges. A number of people did see their insurance rates rise because of new requirements placed on the industry by the reform. But other insurance customers saw lower rates or benefited from the federal insurance subsidies.

How much an individual or a household’s insurance costs changed because of Obamacare depended on a whole host of factors; age, current health status, state of residence, and of course whether the individual (or family) was insured before purchasing a new Obamacare-compliant policy. So it is not easy task to quantify how many people saw rate increases and rate decreases.

According to the Kaiser Family Foundation, the changes in the insurance market brought by the healthcare reform law — including the ten essential benefits Obamacare compliant policies are required to provide and the law’s ban against insurance denials or price variations based on health status — “make direct comparisons of exchange premiums and existing individual market premiums complicated, and doing so would require speculative assumptions and data that are not publicly available.” But a Kaiser survey, which measured the sentiment of people who switched plans because their policies were cancelled, found that 46 percent of respondents said they ended up paying less, while just 39 percent said they were paying more, and 15 percent said they were paying the same. That poll did not include people who qualified for insurance subsides from the federal government.

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Source: Kaiser Family Foundation

A survey conducted by the Commonwealth Fund found that 68 percent of consumers rated marketplace plans as “good” or “excellent.”

Generally, 2014 saw across-the-board premium increases, with women experiencing rate hikes in 82 percent of U.S. counties and men in 91 percent of all counties. Premium price changes ranged from an increase of 271 percent for men in Buchanan County, Missouri to a 70 percent decrease in northern New York state, and on average, premiums rose 49 percent. Even though Kaiser Family Foundation tracking poll showed most Americans report the law has little to no direct impact on their lives, the congressional debate created the fear that premium hikes will continue to grow as the law becomes more entrenched

Rate shock is also not expected to be a problem in 2015. While some publications warned of skyrocketing premiums earlier this year, according to figures compiled by the Health Research Institute of consulting firm PriceWaterhouseCooper, overall premium increases will be small or nonexistent. On average, insurance companies sought hikes of 8.2 percent for next. Averages do belie a great deal of reality, and price increases will vary from state to state, from insurer to insurer, and between individuals of different ages and health. These differences make the data easy to exploit by politicians in favor or against the healthcare reform, meaning some Americans will see huge price increases while for others those premium costs hikes will be much smaller.

Here’s a breakdown of what to expect:

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