Obamacare is Here to Stay

CC: Obama

Since its inception in 2010, the Affordable Care Act or Obamacare has been under assault. The House of Representatives voted over 50 times to repeal or amend it. All these attempts died either because of Senate opposition or because Obama vetoed them. In March, the one time that the political dominoes were aligned to repeal and replace it, House Republicans failed to repeal. This last attempt makes for a very clear fact. Obamacare is here to stay. That is not to say it will not be modified because it will. Even supporters of the Affordable Care Act know that it needs to change. However, the basic principles of the healthcare law are not going away. That is because Barack Obama moved the goalposts of healthcare. That is significant and adds to his historical legacy. This is the most meaningful healthcare legislation since Lyndon Johnson pushed through Medicare in 1966. Those who believe they can repeal Obamacare and return to the pre-Obamacare days are simply fooling themselves.

The  basics of Obamacare are thus:

  • Dependents are covered on their parent’s health plans until the age of 26
  • Preexisting conditions are covered
  • Many preventive health care procedures are free
  • Insurers may not put monetary limits on essential benefits
  • Insurers may not cancel policies when policy holders become sick
  • All individuals must purchase insurance policies or pay a penalty
  • Medicaid expanded to 133% above poverty line
  • Subsidies available for those with incomes 400% above poverty line
  • Employers may now make employees wait longer than 90 days for health care coverage
  • Subsidies available to small business employers
  • Penalties for larger business employers who don’t offer health care
  • Minimum health care standards enforced

The most disliked feature of Obamacare is the individual mandates. Nobody likes being forced to buy anything. However, the mandates were essential to provide the many benefits of Obamacare.

Prior to the Affordable Care Act, preexisting conditions were usually not covered in health plans. Adult children had to get their own plans when turning 18 unless they were in college. Fewer provisions were covered in free preventive health care. Insurers capped many essential benefits. Employer health care was not mandatory.

Premiums are now cheaper for the poor and lower-middle class. On the flip side, those with higher incomes are paying higher premiums. That is the price of having 20 million more people with health insurance, plus the benefits listed above.

There are some real problems in the availability of plans because the quirks and kinks in the law make health insurance unprofitable in some areas for insurers. This is primarily because the risk management programs of the Affordable Care Act have left insurers on the hook for unexpected costs. Changes need to be done to make those markets profitable for insurers. Unfortunately, the Trump administration has no desire to keep Obamacare alive. It is quite likely that they will even cease to do the normal tweaks required in administering laws. Thereby, creating havoc in the marketplace while trying to point their finger in all directions but at themselves as the source of the problems. On the other hand, in many places, Obamacare will operate with only minor hiccups.

This is not surprising. Any new legislation has unexpected consequences. A major, complicated piece of legislation such as the Affordable Care Act has needed tweaking from the beginning. That hasn’t happened because Republicans control Congress and have used their opposition to successfully rally their supporters. That strategy is now coming back to bite them though.

The problem for the repeal crowd in Congress is that Obamacare has been around long enough that the political hype has given way to personal experience. Only 18% of the public want to repeal the Affordable Care Act. The rest either want to keep it the way it is or modify it. The overwhelming majority of Americans have found that there are many things that they like in Obamacare.

The Republican majority in Congress has an impossible situation. Democrats will not support anything that guts the benefits. Even a majority of Republicans now accept that preexisting conditions must be covered in health plans. Most also accept that young adults should be on their parent’s plans until they have established jobs. Many of the other benefits from expanded preventive care to removing caps on benefits are viewed as essential. Republican members of Congress who oppose the subsidies are now on board that those who can’t afford health insurance should at least get tax credits to help pay for it.

These are the results of Obama’s law. This is how Obama has moved the goalposts so that health care cannot go back to the pre-Obamacare days. Even the American Healthcare Act that recently failed in Congress accepted these conditions. As the House Freedom Caucus stated, it was Obamacare lite. What the members of the Freedom Caucus fail to realize is that Americans don’t want to go back to the pre-Obamacare days.

While the Freedom Caucus wants to repeal Obamacare without putting a replacement in place immediately, Republican moderates are even more willing to accept Obamacare. They want to keep the expanded Medicaid. They will not support a repeal of the law.

There is no political path to repeal Obamacare without a replacement. There isn’t even a political path to replace the main features of the law without Democratic support to change it. The Republicans want to say they repealed it. They may in name only, but it would be a cheap political trick. It will be a change in name only, while keeping the main features. It is possible that the individual mandate may get replaced or amended by some form of subsidy and tax credits, but the replacement will have to be sweetened so that people are still compelled to buy insurance. How that will happen is yet to be determined.

One thing for certain, is that the main features of Obamacare will not be repealed. If it was, the 2018 elections would be a bloodbath for the Republicans, and they know it – excepting the Freedom Caucus. As we get later in the year, the chance for major change grows less likely because the 2018 elections will grow closer. The possibility for meaningful change to amend Obamacare will grow more likely. Any deal the Republicans make will require changing the name so that Obama is not associated with it. That makes no difference. Obama was aware that its name needed to change to bring Republicans on board. Whatever it will be called, history will continue to remember it as the descendant of Obamacare. Obamacare is here to stay no matter what it is called.

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