The news is filled with people bemoaning the ACA (aka Obamacare). I am not one of them. My situation has greatly improved. I was a single guy, no kids, early forties, paying $650/month for a HIPAA plan with very high copays and $5,000 deductible. I am now paying $370/month for a platinum plan (10% copay) with $500 deductible. I couldn't be happier.
I have always been a non-smoker, non-drinker, non-drug user, and reasonably healthy. But no insurance company would give me an individual healthcare plan, not since I was 25. I was rejected without explanation by many companies. Presumably they rejected me based on pre-existing conditions, but my pre-existing conditions were trivial, some mild depression and anxiety, but never hospitalized for that or anything else. I finally got insurance through work, and was able to transition to an individual HIPAA plan after becoming a consultant. I could not switch to anything better or cheaper, though, still no company not forced by HIPAA to take me would have me. And I looked into the "high risk" pool coverage (the only other option) that California offered and was shocked to find it was a) expensive, b) had a long waiting list to get in, c) provided really low and weak coverage. So, until the ACA rolled out January 1, 2014 I was stuck.
The news reporting of others' experience with ACA plans has me a little confused. The vast majority of people seem to have had really lousy policies which didn't offer much coverage and they are now complaining that they are forced to buy a more comprehensive policy and thus pay more for it. I have somewhat limited sympathy for those situations, because I think the reality is that those cheap policies often just wind up shifting the cost to everyone when someone who has one of those policies gets seriously ill, finds their policy doesn't provide adequate coverage, and goes bankrupt or otherwise requires the hospitals and debt agencies to eat the loss when they can't pay their bills. The people buying those policies may claim that it's the right plan for them, the right price, and that it's just what they need, but I have to believe on a macro scale that's just not born out, that the rest of society takes a financial hit for their stinginess. If you know that to be false, please correct me. For the remaining minority of people making the news whose prices have gone up significantly without an increase in coverage, and without any offsetting tax reduction, I do feel very badly, and hope cheaper options become available, or other corrective measures are taken.
If nothing else, I am very glad that the health insurance system was finally forced to move away from the cruel and capricious system of excluding people because of pre-existing conditions, it was a savage system that usually unfairly penalized people who had no hand in their conditions, leaving them to fend for themselves or pay dearly for rotten coverage. Whatever people may say about the ACA, at least it did away with that...
Ignoring implementation issues and the specific terms of the Affordable Care Act (Obamacare), I really don't understand how any sensible person can fail to see the logical necessity of having an entire society covered by health care (at least to the level of catastrophic health insurance).
The simple facts are these:
- Anyone can become ill.
- Being ill is expensive, being seriously ill is incomprehensively (life destroyingly) expensive.
- Many people do not have health insurance.
- U.S. hospitals are required to provide life-saving health care to people regardless of ability to pay.
- U.S. hospitals also provide health care with non life-saving conditions who they expect to pay.
- Until the ACA many people were unable to get insurance or had severely limited policies because of pre-existing conditions (many, if not most, of which were absolutely not a result of poor diet, lifestyle choices).
- U.S. hospitals cover the cost of non-paying patients by raising costs for paying patients, depressing nurse and doctor pay, and thereby effectively taxing everyone who pays for medical services.
- People who go bankrupt because of high medical bills cost shift financial burdens to everyone (from unpaid bank/car/school/credit car loans, etc.).
- Younger people require less health care than older people; but young people (who do not die prematurely) will all to a person become old people.
The system we've had from the eighties until now has been very shoddily constructed. The concept with any insurance is simple, distribute the risk across the largest pool of relevant people, so that they can all can be protected at a price they can afford. The issue of what is the relevant pool is certainly up for some discussion. Those issuing the insurance want to collect enough premiums to cover the risks they are securing (and make a profit), sell as many policies as possible to ensure that their risk is distributed / mitigated and profits maximized, and eliminate as many bad, ongoing risks as possible.
Unlike any other kind of insurance I can think of (e.g., car insurance, homeowner's insurance, life insurance) , a person need do nothing more than exist in order to potentially require others to pay for expenses (medical in this case) on their behalf. It makes sense to require owners and operators of cars to have car insurance because they have created a situation in which they are very likely to create potentially catastrophic expenses for themselves and others by the use or misuse of a car. And while pedestrians who do not own/operate a car can and do cause some car accidents, the events are few enough that society has decided to let that risk be absorbed by drivers, not everyone (in other words, if a pedestrian causes a car accident, the car insurance (depending on policy) would help the driver, and separately sue the pedestrian). But simply being born is all that is required to potentially cost others in society tens or hundreds of thousands of dollars. A baby might be born into the world to parents without insurance and immediately require $200k of life saving care, an uninsured 18 year old might require expensive cancer treatments and have no family support.
I hear people say, "I'm 23 [or perhaps 53], I'm unlikely to get sick, I don't need health insurance. I'm self-insuring." But that is just ignorant, they are not self-insuring. They have no capacity to cover catastrophic costs. If that 23 (or 53) year old suddenly finds out they have an aggressive cancer that requires tens or hundreds of thousands in treatment, the odds are extremely high that they will not meet their financial obligations and may escape them through bankruptcy. We all would pay for that person's decision not to have health insurance, through higher medical costs, through higher bank and credit card costs (if they went bankrupt).
And if we can acknowledge that everyone needs insurance and should have it throughout their life, then the notion that young people are paying rates higher than the benefits they collectively will receive in the short term, in order to subsidize older people's premiums, becomes somewhat moot. What does it matter? They could divide up total lifetime health care premiums by the 77.5 years (or so) we're expected to live and charge that amount to everyone, so it is completely consistent from age 1 to age 77. But it makes more sense to me to charge less when people are younger and have fewer resources, and more when people are older and are more likely to have more resources. Further, it makes even more sense to adjust the premiums somewhat so that they do not continue to grow insanely high as you get very old, when people have a fixed income; this requires shifting some of those costs to those who are younger. I fail to see any ideological, moral, logistical problem with this.
I cannot imagine anyone suggesting we charge an 80 year old a premium based on their actual one-year likelihood to require major medical help, it would cost them far more than they could afford. Likewise why would we imagine charging a 23 year old only what he's likely to cost medically in the near term? Insurance only works as a concept if people are in it for the long haul.
I think Obama has made a mess of the current and critical ACA 2014 debut, between the website failures and the grossly misleading statements about people being able to keep their health care (I am one who was notified that I am losing mine), but I can only still conclude it was the right thing to do and we're long overdue for having it. If the Republicans wanted a different solution they had decades in power under several Bushes and a Reagan in which to implement something, and they did not; I'm not even aware of any serious, sensible solution they've proposed which acknowledges that everyone must have coverage for all their lives if the system is to work.
Am I missing something?