The logic of ACA (and illogic of its repeal)
January 19, 2017 Leave a comment
This Ron Brownstein piece is ostensibly about how Trump’s core voters stand to lose as much as anyone from an ACA repeal. But what I really like about it is that it explains the logic of ACA (and the illogic– or at least, every person for themselves appeal– of the Republican alternatives) as well as anything I’ve read. Very good stuff:
Though few subjects may seem more arcane than health-insurance regulation, these contrasting approaches illuminate a core philosophical divide between the parties. The ACA prizes solidarity: It is an intricately interlocked mechanism for sharing the financial risks of medical needs in two respects. First, it shares risk across generations—with today’s young subsidizing today’s old. Second, it spreads risk across any individual’s lifecycle: Under the law, people pay more for health coverage when they are young so they can pay less when they are old. “In many ways under the law the young and healthy are subsidizing the older and sicker on the theory that eventually all of us get older and sicker,” [emphases mine] said Sabrina Corlette, a research professor at the Center on Health Insurance Reforms at Georgetown University. “A key policy driver of the ACA is to pool risk as much as possible on the theory that will make coverage more affordable to a greater number of people.”
By contrast, the GOP plans all prize autonomy. They would allow individuals more choice in whether to buy insurance at all or what kind to purchase, and allow the healthy to pay less unless and until they have significant health needs. The price, in policy terms, for that flexibility is accepting wider divergence between the healthy and sick in both the availability and cost of care. Under the Republican plans, “There’s a scenario where people get a cheaper premium and they have more out of pocket cost sharing and more benefit exclusions,” said Christine Eibner, a Rand Corporation senior economist who studies health care. “And if they have a healthy year they look at it and say this is better. But then they could be in for a surprise if there is a catastrophe or they get really sick and they find something is excluded and the cost sharing is really high.”
Plenty more good explanation of how the ACA marketplaces work and what it would mean to end them. Want to better understand how the ACA really works (and why repeal is such a bad idea), just read the whole thing.