The affordable Care Act 2015 formerly christened as Obamacare is one of the major reforms in the health sector. Obamacare seeks to expand and improve health care access to a majority of Americans by curbing costs of healthcare through taxes and regulation. The primary focus of this policy was to provide more Americans with access to health insurance, improved quality of health insurance and health care, reduce healthcare expenditure in the country and more importantly regulate the insurance industry. However, the policy has received support and opposition in equal measure. Proponents of the policy call it a monumental legislation and a historical victory because they expect the policy to cut costs of healthcare, make health care accessible and affordable to all Americans and protect the users against unscrupulous insurance and employer practices. Besides, it is expected that the full implementation of the policy may reduce the country’s deficit by about $210 billion. On the contrary, critics argue that Obamacare is populist and unconstitutional, where the government is attempting to take over the healthcare system, reduce business competitiveness, hamper the quality of health care and exert a situation of entitlement (Baker and Helene 144). The naysayers argue that the policy will eventually increase the country’s deficit to the region of $340-$700B. This essay, therefore, evaluates the affordable care Act by creating a balanced discussion about the facts of the policy.
The Affordable Care Act sought to reduce healthcare costs and accessibility for most Americans. However, overwhelming empirical studies indicates the contrary. For instance, a study conducted by Brookings in 2014 shows that enrollment-weighted premium in the insurance market for health plans increased by 24.4% higher than what Americans would have paid before Obamacare. Another study conducted by S&P Global Institute collaborate the findings of Brookings arguing that the mean individual market healthcare costs plummeted significantly between 2013-2015 by a whopping 69% rise in premium prices. Further, another study conducted by University of Pennsylvania economists using pre-Obamacare market data, propose that out-of-pocket payments and insurance premiums increased by a margin of 14% and 28% after the introduction of ACA. The conclusion by the economists is that premiums before Obamacare were much lower compared to the least silver plan premium under Obamacare. On the contrary, Paul Ginsburg and Loren Adler carried an independent evaluation on Obamacare, and their findings contradicted those of Brookings and University of Pennsylvania economists, the authors argue that average premiums reduced in the individual market after the first year into the implementation of Obamacare. This evidence is also collaborated by a Huffington Post article by Jeffry Young that proposes that the average hiking of premiums shall be 8.2% in at least 29 states, slightly lower than 10% annual increases in premium prices before the enactment of Obamacare (Brian).
In terms of whether Affordable Care policy was going to increase or reduce the U.S deficit, there is evidence from congressional budget outlook and other scholarly works supporting the view. According to Mauldin 2016 in an article published in the Forbes magazine, the author notes that the U.S deficit grew by $590B in 2015 to $1.4Trillion in 2016 fiscal year after the enactment of Obamacare. The argument is that due to the government subsidizing over 25million people through Medicaid it means that the deficit will continue ballooning. Put in perspective, expenditure on Medicaid expanded by $48B representing a 16% growth in 2015 due to the expanded coverage program. It is estimated that the average monthly enrollment for Medicaid stands at 55% higher than what was experienced in 2015. Further, the Federal allocations on Medicaid total to about $350B, a figure which is expected to increase as the enrollments continue to increase. Due to the expanding federal outlays of Medicaid subsidies, the national debt is expected to continue increasing. On the contrary, Gruber argues that the full implementation will eventually lead to lower national debt deficits due to what the author terms as indexing. Indexing, according to the author, means that the government will constantly intervene and set forth adjustment mechanisms that will ensure tax regimes are consistent with the expected benefits of the affordable care Act. In this regard, the author assesses that the health reform policy will reduce the national deficit by $200B over a period of 10 years and a trillion in the following decade. Accordingly, the policy is expected to reduce health care costs by mainly rewarding doctors, health facilities and providing Americans with an affordable healthcare plan (Gruber 14).
The other focal point for assessing this policy is by determining whether it improves the healthcare system as intended. The affordable care Act includes a number of Medicare reforms that are expected to generate revenues through savings for Medicare and buttressing of the benefits accrued to enrollees. The policy is viewed as a conduit that protects that benefits enshrined under Medicare but also keeps the senior citizens covered. Further, the policy has frameworks for ensuring improvement in the quality of service delivery, promotion of new models of healthcare delivery, standardization of prices and reduction of abuse, fraud, and wastage in the industry. On the contrary, the critical assessment shows that Obamacare may cut federally outlays on Medicare to the tune of $716B staggered from 2013 through 2022. The Medicare trustees propose that cutting outlays on Medicare as the implementation of the policy continues threatens the livelihoods of the senior citizens insofar as access to quality healthcare is concerned. As an illustration, the law suggests reducing allocation in Medicare Advantage, which is the private insurance plan secured under Medicare, the $156b cut was expected to take effect from 2013 to 2022. What is experienced today is that the cuts in allocation have had a significant effect on the private insurance plan because the insurer is now adjusting its products by restricting provider networks. The net implication is that most senior citizens may end up with fewer provider options and therefore the essence of affordability shall be lost (Day 128).
Finally, it has been argued that Obamacare affects business competitiveness. On the one hand, it can be agreed that the policy puts a dent in the profitability of businesses and insurance companies. This argument is placed in the context where the policy demands that businesses with at least 50 workers employed on full-time basis ought to provide them with insurance cover. The Republicans argue that forcing employers to cover all employees threatens the sustainability of small and medium enterprises and may kill startups. Due to the slump in economic growth in 2014 after the law was enacted, employers were forced to spend at least $11,204 per employee on health cover higher than the case in 2013. It is from this basis that critiques argue that the law has failed to yield lower costs on insurance stating that the ACA compliance and administrative costs are a burden on employers and small business owners. Besides, it is argued that the policy is complex in terms determining full-time employees and those that are not. Due to this cumbersome nature in compliance, some small businesses are forced to cut man-hours to less than 30 per week in order to evade compliance. Additionally, Obamacare is viewed as a policy that has exacerbated the problems faced by small businesses in surviving under a tough economic environment and unfavorable administrative costs (Pasek, Gaurav and Jon 665).
In conclusion, upon evaluating the different viewpoints regarding the objectives of Obamacare, my value judgment is that Obamacare is a policy that needs to be repealed to sort out some of the challenges facing the implementation of the law.
References
Baker, Dean, and Helene Jorgensen. "The Affordable Care Act: A Hidden Jobs Killer?." International Journal of Health Services 45.1 (2015): 143-147.
Brian, Blasé. Overwhelming Evidence That Obamacare Caused Premiums To Increase Substantially. Forbes. 2011. Retrieved from http://www.forbes.com/sites/theapothecary/2016/07/28/overwhelming-evidence-that-obamacare-caused-premiums-to-increase-substantially/#2a422e046e3c
Day, Benjamin. "The Affordable Care Act and medical loss ratios: No impact in first three years." International Journal of Health Services 45.1 (2015): 127-131.
Gruber, Jonathan. The impacts of the Affordable Care Act: how reasonable are the projections?. No. w17168. National Bureau of Economic Research, 2011.
John, Mauldin. Thanks To Obamacare, Government Debt Is Worse Than You Think. Forbes, 2016. Retrieved from http://www.forbes.com/sites/johnmauldin/2016/11/02/thanks-to-obamacare-government-debt-is-worse-than-you-think/#68cda9da7872
Pasek, Josh, Gaurav Sood, and Jon A. Krosnick. "Misinformed about the Affordable Care Act? Leveraging certainty to assess the prevalence of misperceptions." Journal of Communication 65.4 (2015): 660-673.
