Thank you for your click.
Well, they could have. Maybe. Had this news broken months ago. Had Republicans not turned Obamacare demonization into a farce. Had Donald Trump not confused women for bowling balls or maligned a war hero’s family or tongue-punched Vladimir Putin’s tundra-encrusted butthole on national television or [memory exceeded bandwidth exceeded commence Internet shutdown N!HU*$)Y87324009NOUY78B8(*@#&21M&W34]
OK, fine. A topic that could adversely affect millions of Americans deserves more than my glib response. Shit, this piece isn’t really even about how rate increases impact the election. You’ll click a headline that contains the name “Trump” far more often than one that reads “How to Fix the Affordable Care Act to Benefit All Americans,” so here we are. Now that I’ve tricked you into reading this far, I hope you’ll stick around for a discussion about the Affordable Care Act’s problems, potential resolutions, and how
our next president Hillary Clinton can use the law to transform American healthcare for generations.
In order to provide the delicious content you crave, though, I’m first going to have to dive into arcane healthcare policy. This will bore you. Suck a dick. Nationwide healthcare coverage is arguably the most critical issue our nation faces and you should understand its impact. Can’t do that without comprehending how we got here, and why. I’ll do my best to mix sugar-laden jokes, frosted puns, delectable GIFs, and high-fructose corn-syrup pop-culture references in with the policy vegetables so you millennials can swipe right on some knowledge that may one day save your life.
On Monday, the Obama administration released data indicating that premiums for mid-level private insurance plans offered on the state and federal healthcare exchanges would rise on average by 22 percent next year. This is not an insignificant increase. For comparison, rates rose 7 percent from last year to now. These stats are a little misleading, but we’ll table that discussion for now to focus on root causes. In short [extreme caveman voice]: doctor cost more dollars. Still with me?
Premiums are rising for the second straight year due an interconnected sequence of events. We’ll work backwards. First, insurers are either scaling back participation in the state and federal healthcare exchanges or leaving altogether. UnitedHealth and Humana bowed out in August. A few weeks later Aetna, one of the nation’s largest health insurance companies, announced they were terminating coverage in 11 markets. This mass exodus dramatically reduced competition — in 89 percent of the counties where there is only one insurer, that insurer is Blue Cross Blue Shield — which partially accounts for the upcoming rate hikes.
But why are these insurers fleeing with their pants down like their girlfriend’s husband came home from hunting camp two days early? The ACA basically handed private insurance companies tens of millions of new customers. Even Trump’s single-celled ass could capitalize on this opportunity, right? Well, it’s important to understand who these new customers are. Lots of sick people who couldn’t previously purchase insurance due to pre-existing conditions bought plans. Far more than anticipated. At the same time, the young, healthy uninsured population didn’t embrace Obamacare to the extent predicted. Broad risk pools are critical to the law’s effectiveness. Those healthy non-insurance-using folks were supposed to offset the hordes of expensive clients kicking down insurance company doors after the ACA made it illegal to deny coverage for pre-existing conditions. While allowing previously uninsurable citizens to get the inexpensive health coverage they require is objectively great for society, the unbalanced ratio negatively impacted bottom lines. Aetna lost $300 million in the marketplaces last year and $430 million since 2012, which the company alleges was the primary driver behind their decision to walk this summer. (Another, more cynical interpretation is that Aetna tried to cripple the law as retribution for Obama’s Justice Department blocking a planned merger between Aetna and Humana).
To make matters worse, insurers had very little data beyond the initial enrollment forecasts to use when pricing their plans. Set the premiums too high and they price themselves out of an open market. Aim too low and the margins shrink to nothing. Hit on 18, or hope the dealer busts? Insurers erred on the side of caution, lowballing their preliminary offerings so much that ACA premiums were actually much lower than anticipated for years.
Eventually, insurance companies discovered they based their premium rates on forecasts that weren’t panning out. The exchanges weren’t just smaller and less profitable than expected. They were downright detrimental. So the CEOs colluded to euthanize all the sick people on their rolls and start fresh with the remaining population.
Just seeing if you’re still paying attention.
Here’s the thing: the ACA architects anticipated this (the pre-existing condition problem, not mass corporate-ordered liquidation), so they created something called the individual mandate. In a nutshell, this allows the government to levy a fine on anyone who doesn’t carry health insurance. This was designed to incentivize uncovered Americans to buy insurance rather than shell out hard-earned dollars for nothing.
But Congress fucked up (even more than usual). Faced with mounting pressure from constituents furious about being forced to pay for their health coverage or risk a fine, legislators set the fee so low as to be essentially ineffective. Opting not to purchase insurance will set you back $695 per adult and $347.50 per child up to a household maximum of $2,085. Some plans cost almost that much per month even before factoring in deductibles. The government effectively made immortal millennials choose between buying insurance for a substantial amount each month or getting kicked in the groin once a year for $1,000. GIMME THE STEEL TOES BABY! I’LL HAVE THE ER DOC RECONSTRUCT MY SCROTUM FOR FREE!
To recap for all you Dug the Dogs who headed for the comments the second you saw the words “healthcare policy:” Insurers underpriced their plans to start, fewer healthy people participated in the exchanges than anticipated because the penalty for opting out paled in comparison to the plan costs, so insurance companies lost pallets of cash paying claims for sick individuals and did the Seinfeld theater GIF.
Now we’re fucked. The exchanges will collapse, premiums will cost a fortune, and the only doctors we’ll be able to see are Doug Ross and Carol Hathaway making out on ER reruns airing constantly in the city-sized government hospices where we die in agony from easily preventable illnesses. Thanks, Obama. You shitbird.
Hashtag actually, the announced premium increases only affect 17 percent of plans because most exchange planholders receive federal subsidies to offset the premium cost. It’s also likely a one-time increase designed to bring pricing in line with initial expectations. From the Los Angeles Times:
In November 2009, the Congressional Budget Office projected that single coverage premiums for a benchmark silver plan would average $5,200 in 2016. The average for those plans in states using the federal healthcare.gov exchange will be $5,586 next year, in line with the CBO’s annual projected growth rate.
Still, this isn’t all fine. Pretending the ACA is flawless because we respect the effort and the man behind it is just as dumb as screaming it’s a job-killing socialist experiment that should be fired into space and blasted into microparticles. Sure, these premium increases only affect about 17 percent of enrollees. That’s still roughly 1.5 million Americans who face double-digit premium hikes next year. A 20 percent increase can amount to thousands in unforeseen expenditures for those unfortunate families who don’t have coverage through an employer but earn too much (over 400 percent of the Federal Poverty Level) to qualify for subsidies. That’s an undeniably shitty deal. Plus, the rate hikes will all but force people to shop around for plans during open enrollment, a pain in the ass process that busy, overwhelmed low- and middle-class Americans shouldn’t have to undertake each year.
Fixing the ACA should be Clinton’s first major domestic initiative. Not only because she’s dying from an undisclosed illness. Because healthcare has been a passion project for Hillary since before her husband occupied the oval. Because solidifying her predecessor’s signature achievement will unite liberals still smarting over her winning four million more votes than Bernie Sanders and thus brazenly stealing the nomination on a scale not seen since the Lufthansa heist. Because it’s the right course of action for the world’s greatest democracy.
The solutions are simple but not easy. The exchanges need more healthy customers. The best and most sensible way to increase participation is to simultaneously increase federal subsidies and the individual mandate penalty; more people would be willing to get coverage if the difference between buying a useful product and paying a fine for nothing shrinks to a negligible figure. Expanding Medicaid to across the country gives lower-income Americans access to quality, proven healthcare without the massive deductibles. Of course, the ACA is still relatively unpopular. Raising the individual mandate fine borders on political suicide and won’t happen without help from Republicans sworn to oppose Clinton’s every action. Medicaid expansion remains a pipe dream in states with Republican state houses.
Clinton should still try. Rally the public. Spend political capital. Frame reform not as a bureaucratic fix, but the necessary next step in realizing the goals set forth by our founders: ensures domestic tranquility, promotes the general welfare, and secures liberty’s blessings for posterity. Nothing encompasses these ideals more than providing affordable healthcare to every single American.
Oh yeah, I still owe you a pop-culture reference.
THE STRANGER THINGS KIDS RIDING ON THE BACK OF A WESTWORLD ROBOT HORSE WAVING A TARGARYEN FLAG DOT GIF