ACA Is Uninsuring the Insured

By Doug Badger, Senior Fellow, Galen Institute. Excerpt: 

"The number of people with individual health-insurance coverage is shrinking. Despite $146 billion in federal subsidies to low-income households and well-capitalized insurers, 2.6 million fewer people had individual policies in March 2017 than in March 2016, a drop of nearly 15 percent.

The most precipitous decline has occurred among people who pay their own premiums without government help. The number of those with unsubsidized coverage fell by nearly one-fourth between March 2016 and March 2017, from 11 million to less than 9 million. There are now nearly 3 million fewer people with unsubsidized individual coverage than in 2013, the year before the government began doling out Obamacare premium subsidies. If the current trend persists through December, the individual market as a whole will insure fewer people this year than it did in 2014.

And the decline isn’t limited to the individual market. There were 3.6 million fewer people with job-based coverage in December 2016 than in December 2013. While 8.4 million people received Obamacare premium subsidies last year, private coverage increased on net by only 1.7 million between December 2013 and December 2016.

While there are no perfect data, these numbers are far more precise than survey results, the standard source of coverage estimates. They derive from insurance-company regulatory filings compiled by Mark Farrah Associates and on reports issued by the Centers for Medicare and Medicaid Services. The MFA data capture the total number of people enrolled in individual policies through March 2017; CMS tells us how many people had exchange-based individual coverage through February 2017 and how many of them received subsidies. Subtracting the CMS numbers from the MFA data yields the number of people who have unsubsidized individual coverage. Data on the individual and small-group markets through December 2016 come from an analysis by the Heritage Foundation’s Edmund F. Haislmaier and Drew Gonshorowski, who also used the MFA data set. The decline in individual health-insurance coverage is almost never reported (NRO being a rare exception) and contradicts the prevailing Obamacare narrative. A recent New England Journal of Medicine editorial recited the received wisdom: “The ACA’s individual market structure — though not perfect — is sound and has succeeded in greatly expanding coverage. As 2017 began, the market was poised to leave behind the growing pains of the past few years. Then the President and Congress acted to create needless turmoil.”

Virtually every assertion in that passage is false. The individual market is not “sound”; it is contracting as rising premiums are pricing millions out of the market. Nor can it be credited with “greatly expanding coverage”; the individual-market coverage gains achieved by distributing subsidies to some have for the most part been offset by coverage losses in the individual and group markets among unsubsidized consumers. Obamacare was not “poised to leave behind the growing pains” in 2017; it was entirely predictable that those pains would worsen.

And all this “needless turmoil” antedated the Trump administration. He took office during the closing days of the 2017 open-enrollment period. By then, the die was cast.

The narrative nevertheless endures. Believing it requires indifference to millions of people who can no longer afford individual policies and to millions more who may forfeit their policies with the next round of rate hikes. For many of them, Obamacare has been a serial nightmare, producing policy cancellations, skyrocketing premiums and deductibles, and a narrowing choice of doctors before finally leaving them uninsured.

Obamacare is insuring more poor people and uninsuring millions of middle-income people. That suits the Democratic party and many congressional Republicans just fine. They measure social progress in the number of people receiving government assistance. Those struggling to pay their own way evoke little sympathy. Lawmakers of both parties, whose consciences were lacerated by CBO’s theory that millions would “lose” coverage under the GOP’s “repeal and replace” legislation (most of those “losses” the result of people voluntarily dropping insurance once the individual mandate was repealed) are unmoved that millions actually have lost coverage under the law they fought to preserve."