The ACA “Works” Best for Insurance Companies

Amid all the triumphalist rhetoric about the ACA, consider a few data points:

• The uninsured rate in America has steadily increased over the last several years. Nearly thirty million Americans were uninsured in 2019, according to Census data.
• Eighty percent of Americans told Gallup that they have not seen their health insurance premiums decline since the passage of the ACA — and 50 percent say they fear being medically bankrupted.
• Medical claim denial rates have been skyrocketing. Insurers reject more than one out of every six health insurance claims made by patients on ACA exchange plans.
• Reuters recently reported that while the uninsured rate is lower than it was two decades ago, “the proportion of adults unable to afford doctor visits climbed from 11.4 percent to 15.7 percent.”
• “Annual family premiums for employer-sponsored health insurance rose 4 percent to average $21,342” in 2020, according to data from the Kaiser Family Foundation.
• Among those with employer-based health care coverage, “About one in five say that someone in their household has been contacted by a collection agency in the past 12 months because of medical bills, and 9 percent say they have at some point declared personal bankruptcy because of medical bills,” according to a 2019 Los Angeles Times/KFF study.

To be sure, the simple, straightforward expansion of Medicaid was the best part of the original law. But by its own authors’ admission, Obamacare went out of its way to try to halt the larger push for a single-payer system, because in the words of Obama Health and Human Services secretary Kathleen Sebelius, they believed “dismantling private health coverage for the 180 million Americans that have it, discouraging more employers from coming into the marketplace, is a bad direction to go.”

The real thrust of the ACA has always been to find ways to pretend to address the health care crisis while enriching the health insurers that are fueling it.

The law spends hundreds of billions of dollars on such subsidies, and the American Rescue Plan expanded who’s eligible for subsidies. Those expenditures are touted for somewhat decreasing people’s premium costs — and indeed, more than one million Americans recently signed up for ACA exchange policies. But subsidizing coverage only limits the premium costs people pay themselves, with the government picking up the rest, on what are expensive plans. Overall health care costs remain sky-high.

While the new ACA sign-ups were celebrated as an enormous victory, many more Americans lost their employer health insurance coverage during the COVID-19 pandemic. And left unsaid by all the fist-pumping, high-fiving, self-congratulation from pro-ACA politicians is the fact that the ACA exchange plans that more and more Americans are being forced into also tend to feature excessive out-of-pocket costs — meaning many people are being shuffled onto plans they can’t actually afford to use.

Health insurers saw their profits boom during the pandemic last year, too, while millions lost their job-based health insurance coverage and people avoided going to doctors and put off elective procedures.

Overall, a decade into the ACA’s attempt to prop up and promote corporate health insurers, “individuals with private insurance were more likely to report poor access to care, higher costs of care, and less satisfaction with care compared with individuals covered by publicly sponsored insurance programs,” according to a study by California researchers just published in the Journal of the American Medical Association.

Put it all together, this data shows the ACA works in the same way a train robbery works — it works really well for the thieves but not so well for the passengers.

Demoralization, Tribalization, and Health Care Surrender

People generally understand their insurance company is out to screw them. About a third of unvaccinated Americans believe they “might have to pay an out-of-pocket cost to get the COVID-19 vaccine,” even though it’s free, according to recent survey data from the Kaiser Family Foundation.

And yet here’s the thing: many of the passengers seem fairly content with the heist — or at minimum, grateful that it’s just larceny and not an execution.

Gallup recently found that even as health care costs continue to increase, more Americans are now saying they are satisfied with what they’re paying. When it comes to the ACA in specific, KFF’s most recent polling found 53 percent of Americans view the program favorably.

Some of that can be attributed to the varied and nebulous understanding of what the ACA hodgepodge actually is. Some understand it primarily to be just a long-overdue prohibition on denying coverage to people with preexisting conditions. Some view it as just subsidies for slightly lower premiums. Some perceive it as the devil they know that’s safer than the devil they don’t. And some see it as at least modestly better than the Republican agenda of just sending people to the glue factory when they get sick.

Fair or unfair, justified or unjustified, the bottom line is this: after a decade of Democratic Party propagandizing and GOP offering no alternative at all, the ACA remains somewhat popular. The support is thin — lots of polls show Americans want to see the program improved — but there’s no denying that it has support, even as it has politically fortified an abusive, for-profit insurance industry.

Of course, the ACA has helped make sure more people are able to get ripped off on medical care rather than get completely cut off from the entire medical system. In that sense, the ACA is better than nothing at all, just like a train robbery is better than being thrown off the back of the caboose.

But the ACA’s modest popularity reflects demoralization and tribalization at least as much if not more than it reflects genuine satisfaction with the existing system.

After decades of watching other industrialized countries establish functioning universal health care systems and our government continue to prop up a system based around corporate health insurance, many Americans have concluded that nothing will change, that even tiny improvements are a huge win — and that policies like the ACA that are billed as transformational don’t transform much at all. Meanwhile, in a nation where public policy is now just fodder for the red-versus-blue bloodsport, any mention of ACA shortcomings is often seen first and foremost as betraying the blue team, so the program’s popularity is further bolstered by home-team spirit.

The popularity that has accrued to the ACA doesn’t exist in a vacuum. As the law itself enriches insurance companies and thereby strengthens their political power to block structural reform, Obamacare’s modest popularity further bolsters insurers by reducing the public demand for change.

For example, Americans’ contentment with the crumbs offered by the ACA goes a long way in explaining why even something as minimal as a public health insurance option has become a political laughingstock akin to the football in the famous Charlie Brown–Lucy scene.

For a decade, the Democratic Party and its allied liberal groups in Washington have been able to beat back discussion of universal health care by pretending they support a public option to compete with private insurers — and then they have inevitably cast aside the proposal when they regain power. This is what happened in 2010, and what is now happening again after Biden abandoned his public option promise in favor of a health care policy quite literally written by insurance industry lobbyists.

“The health insurance public option might be fizzling. The left is OK with that,” NBC News reported over the weekend. “Joe Biden campaigned on making the public option a reality, but so far, he’s done little to get Congress to enact one. Instead of outrage, influential progressives seem to be OK watching the promise go unfilled, preferring to pursue universal health care through other means, like expanding Medicare eligibility.”

The public option betrayal is indirectly linked to ACA popularity: sure, public option promises helped Democrats win elections, but they pay no price for abandoning those promises because hey, everything’s totally fine and here’s a tweetable Biden-Obama ACA commercial to prove it.

The same dynamic is at play with proposed Medicare expansion and full-fledged Medicare for All. Like a public option, those policies may be conceptually supported by a majority of Americans, but it’s been a half-century since the creation of Medicare.

That’s a half-century of insurance industry hegemony in American politics — a half-century of the country being conditioned to expect that when it comes to health care, nothing can fundamentally change. All those years have taught successive generations that even if we may like the idea of big changes, we should just be content that the ACA protects people with preexisting conditions, lets more people buy bad insurance, and preserves a predatory health care system that “only” bankrupts half of all cancer patients.

Perhaps that perception is correct. Perhaps America’s government is so uniquely corrupt and singularly captured by the health care industry that our most enduring form of exceptionalism will be permanently remaining the only industrialized country to not guarantee medical care to all people.

But as resigned as many may be to an eternity of ever-increasing medical bills, that doesn’t have to be our destiny.

We don’t have to reward inadequate policies with favorable opinion polls.

Regardless of slick White House videos or football-spiking tweets from senators, we don’t have to believe it is some enormous victory that millions of people were thrown off their employer-based health care but at least some of them were able to get crappy coverage on for-profit insurance exchanges that involve high out-of-pocket costs and high claim denial rates.

In short, we don’t have to just accept that the best we can hope for is a policy that funnels more cash to private insurance companies in exchange for smaller and smaller discount coupons for more and more expensive medical care.

Perceiving that downward spiral as normal and laudable is a choice by elected officials, by party powerbrokers, and by voters — and it is a choice we can reject.