Debate Desk
Did Obamacare Lower Health Care Costs and Fix the System?
The Affordable Care Act expanded coverage, but premiums and deductibles rose and its promises about keeping plans and doctors did not hold.
The claim
Supporters credit the Affordable Care Act of 2010 with covering millions of people who had been uninsured, ending denials for preexisting conditions and slowing the growth of costs. Repealing it, they say, would take care from people who need it.
The answer in three points
- The law did expand coverage, mainly through the Medicaid expansion and subsidized plans. That is a real accomplishment, and it came at a large cost to taxpayers and to those buying insurance without subsidies.
- The central promises about price did not hold. The president said families would save $2,500 a year and that people who liked their plans could keep them. Premiums in the individual market rose substantially in the following years, deductibles grew, and many people lost plans they liked.
- The law's structure of mandates and rules pushed up prices to cover guaranteed issue, and subsidies hid part of the increase from those who received them. A better design would protect people with preexisting conditions through high-risk pools or similar means and let the rest of the market offer more choice.
The central lesson is that complex promises should be tested against results. Citizens can judge a law by the premiums on their own bills.
The numbers
- The Affordable Care Act was signed into law on March 23, 2010, according to the White House archives.
- The Supreme Court upheld the individual mandate as a tax in National Federation of Independent Business v. Sebelius (2012) and made the Medicaid expansion optional for states.
- The Department of Health and Human Services reported that average individual market premiums roughly doubled between 2013 and 2017, according to its Office of the Assistant Secretary for Planning and Evaluation.
What they will say next
"Millions gained coverage." They did, and it is fair to credit that. The question is whether the same or better could have been done with less disruption and expense, and whether coverage translates into better care.
"Preexisting conditions are protected." They can be protected in other ways, as high-risk pools did in many states before 2014, with direct funding that does not raise prices for everyone else.
"The mandate penalty is gone and the law survived." Congress reduced the penalty to zero in 2017, and the law persists in part because subsidies grew. Its costs are now paid by the Treasury as much as by premiums.
"Cost growth slowed after 2010." It did, and it also slowed in many other countries in the same period. Attribution to the law is hard to prove.
The better answer is a system where patients control more of the money and prices are visible.
"The law still has strong public support." Support for popular provisions, such as covering preexisting conditions, is high, and the question is how to keep them at lower cost. Alternatives can preserve protections while giving families more choice.