Goodbye To Obamacare

Obamacare!  It was supposed to usher in a new era of healthcare nirvana.  Universal "coverage"!  Better health!  "Bending the cost curve"!  "Affordable" care!

Have you noticed that you haven't been reading much about Obamacare recently?  Yes, there was a blip of press mentions last year, when the Republican Congress was making some failed attempts at full repeal of the Act.  (See my coverage here from September 27, 2017.)  And since then, mostly radio silence.  So, was universal "coverage" in fact achieved?  And, what happened with the health results?  And with the famous "cost curve"?  I'll bet you don't know.  Could it be that the press just doesn't report things that are unfavorable to the official narrative?      

And now, rather suddenly, it looks like Obamacare may be on its last legs.  Recall that when the Supreme Court upheld the constitutionality of the Affordable Care Act in 2012, the reasoning was that the so-called "individual mandate" was enforced with a tax, which the Court said the Congress had the power to enact.  But then one of the provisions in the big tax reform statute at the end of 2017 repealed that tax, effective January 2019.  Whereupon 20 states brought a new lawsuit in the Northern District of Texas asking for the logical conclusion to be drawn, that all of Obamacare was now unconstitutional.  On Thursday (June 7), the Justice Department filed a brief in that case agreeing with the plaintiffs that various sections (basically, most of the heart) of Obamacare "must now be struck down as unconstitutional":

Critically, . . . the Supreme Court’s saving construction of the individual mandate as a tax is no longer available. The TCJA eliminated the penalty for failing to purchase minimum essential coverage (starting in 2019), but left untouched the statutory “[r]equirement to maintain minimum essential coverage” in Section 5000A(a). See Pub. L. No. 115-97, § 11081, 131 Stat. at 2092. The individual mandate thus still exists, but it will no longer be fairly possible to describe it as a tax because it will no longer generate any revenue.

A group of Democrat-led states has joined the case to stand up for the statute.  However, given the reasoning of Justice Roberts's opinion in the original case, it would seem that the statute is in serious trouble.

Should we care?  That post of mine from last September quoted various Democratic luminaries attacking the then-proposed repeal of Obamacare as "cruel," or "heartless," or some variation thereof.  But to what extent did Obamacare actually achieve -- or, come close to achieving -- its stated goals of universal "coverage," better health outcomes, or lower cost?

Start with the question of "coverage."  Prior to enactment of Obamacare, the proportion of the population said to be "uninsured" was typically in the range of about 14 - 16% of the population under 65, representing about 40 million or so people.  This was portrayed as an unimaginable crisis.  After enactment, but before full implementation of the statute, the numbers of "uninsured" actually spiked upward.  Gallup -- which has conducted big surveys on this issue -- put the proportion of "uninsured" in late 2013 as having reached 18%, more than 45 million people.

Then the figure began to drop.  At the lowest point in Q3 2016, according to Gallup, the proportion reached 10.9%, or about 28 million people.  But then the numbers began to increase again.  The latest figures from Gallup (Q4 2017) put the proportion at 12.2%, about 31 million people.  So as of the latest data, the absolute number of "uninsured" is down by about 9 million or so from the baseline prior to enactment of the statute.

But wait:  the changes in the Obamacare statute can be divided into two categories:  (1) the whole "individual mandate," required coverage, Obamacare exchanges thing, and (2) and expansion of Medicaid eligibility.  How many, out of the reduction in "uninsured" of 9 million or so, represent new Medicaid beneficiaries brought in by the expanded eligibility?  The answer is that between July 2013 and November 2017, there were 13.8 million new Medicaid beneficiaries in the states that expanded eligibility.  That's far more than the decrease in the number of "uninsured"!  Does that mean that the whole individual mandate/exchange thing accomplished absolutely nothing, and indeed may have led to increasing numbers of "uninsured" for the non-Medicaid population?  Of course, you can't completely tell, because there are too many simultaneously moving pieces.  But clearly it is impossible to prove anything other than that the expansion of Medicaid was far and away the main contributor to increasing the numbers of "insured."  Or, in other words, people without "insurance" will accept it if it is given to them for free.  No big surprise there.

Meanwhile, the pre-Obamacare 40 million or so "uninsured" was supposedly a huge crisis, but the 30 million or so post-Obamacare "uninsured" doesn't seem to be a crisis at all.  The hugely complicated Obamacare structure, and the effective government takeover of a major portion of the economy, barely made a dent in the supposed crisis that it was supposed to end.  And why has the number of "uninsured" ticked upward so significantly in the most recent year?  Many commenters on the left seek to attribute the uptick to Trump, but it is hard to see what has changed in the program that might have caused the increase.  Oh, other than the ongoing rapid rise in premiums.

That was supposed to be the next goal of Obamacare: lowering costs.  Once the healthy would be compelled to buy "coverage," the costs would be shared fairly, and costs for everyone would go down.  But it turned out that the effort to compel people to buy in (other than by providing the "coverage" for free) failed dismally.  And the costs then did exactly what you would expect.  According to this piece from CNBC in October 2017, the average cost of so-called "silver" plans was set to increase by a stunning 34% for 2018.  One effect of the dramatic rise in "silver" plan premiums has been to drive people down to the lowest tier of plans, deemed "bronze."  Again from CNBC, this time relating to the 2017 year:

Families enrolled in bronze plans will have average deductibles of $12,393, according to the study by the consumer insurance comparison site HealthPocket.

And finally, the results were no different in health outcomes:  they actually got worse as Obamacare fully kicked in.  As I noted in that post in September 2017:

[T]he full implementation of Obamacare in 2015 and 2016, instead of being accompanied by an increase in life expectancy, had been accompanied by a decrease in life expectancy.  

So, Obamacare, will anyone actually miss you?  Practically nobody, I predict.  Maybe insurance companies will even start to put their collective minds to designing inexpensive products that it would make sense for the young and healthy to buy!