Map of life expectancy at birth from Global Education Project.

Thursday, March 12, 2015

Why is the ACA so unpopular?

This is a question about which I have expressed my puzzlement here from time to time. Economist Gail Wilensky, in JAMA, has a go at it. Her central proposal is that Obama's notorious repeated statements that "If you like your plan, you can keep it," and that you could also keep your doctor, turned out not to be true.

Well, yes, not literally true. Actually the vast majority of people could keep their plans, and as for not being able to keep your doctor, that was already a possibility before the ACA. It's insurance companies, not the government, that decide what docs they want in their network.

Also too, the Robert Wood Johnson Foundation and the Urban Institute find that it really wasn't all that many people who couldn't keep their insurance -- and not only that, but most of those who couldn't probably didn't like it. In 2013, the first year of the ACA, 18.6% of people with non-group insurance were told that their existing plans would no longer be offered because they weren't ACA compliant. Note that this does not mean that they lost their health insurance. What it means is that they had to buy a different, better policy, and if they were eligible for a subsidy it likely wouldn't even cost them more. That was about 2.6 million people, some percentage of whom were no doubt disgruntled, but still, that would not drive the overwhelming unpopularity of the ACA.

In 2014, that problem pretty much went away. Based on survey data:

[P]olicy cancellations caused by noncompliance with the ACA were uncommon in 2014 in both the nongroup and ESI markets, and the number and rate of cancellations in the nongroup market in 2014 was far smaller than in 2013. The nongroup market has historically been characterized by high volatility: an analysis of pre-ACA nongroup coverage patterns from 2008–11 shows that only 42 percent of nongroup enrollees retained their coverage after 12 months (Sommers 2014). It may still be the case that insurers chose to cancel policies for business reasons, such as low enrollment, so some cancellations are to be expected for reasons other than ACA compliance. The nongroup cancellations caused by unknown reasons may be explained by such business decisions.
Note the additional implication: It was not necessarily the case that if you liked your plan, you could keep it, even before the ACA. The only people who are not demonstrably better off under the ACA are:

  • Affluent people, who do not quality for subsidies, who do not get employer-provided or other group insurance, who are healthy, and who therefore chose to buy really crappy insurance. They no longer have that option and they may have to pay more, but for better insurance. If they should be hit by a bus, they will realize that they are not, in fact, worse off. How many such people are there? Very few, I'd wager.
  •  Extremely wealthy people who had their taxes raised by a tiny bit. 
That's it. The reason people don't like the ACA is because they have been told they're supposed to hate it, and they don't actually know what it is.

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