The number of uninsured Americans rose in 2018 for the first time since the Affordable Care Act passed in 2010, according to recent research from the Census Bureau.
Obamacare’s defenders were quick to blame the change on meddling by the Trump administration. But the real culprit is the law’s faulty design.
Since the first exchange plans went into effect in 2014, Obamacare has consistently delivered higher premiums and deductibles for average Americans who don’t get coverage from their employers. As a result, millions of people have fled the Obamacare exchanges over the past few years. Today, only people who receive government subsidies can afford exchange plans.
Currently, Americans who make less than 400% of the federal poverty level but do not qualify for Medicaid are eligible for subsidies for Obamacare plans. These subsidies are often quite generous. For example, a family of four with $50,000 in annual income could get a $15,855 plan for just $3,250 — or $271 per month.
Just under half of Americans are eligible for these subsidies. The rest are out of luck, and face monthly premiums routinely exceeding $1,000.
As a result, many people are deciding not to shop for coverage on Obamacare’s exchanges. Between 2016 and 2018, unsubsidized enrollment plummeted by 2.5 million — a 40% decline from around 6.2 million to 3.7 million. Eighty-seven percent of people with exchange coverage received subsidies in 2019.
The cost of exchange coverage has soared because of Obamacare’s many rules, mandates and regulations. For instance, Obamacare requires every plan sold on the exchanges to cover a list of 10 “essential health benefits,” from pediatric vision care to substance abuse treatment. Such comprehensive coverage is expensive. It’s also unappealing to many people, particularly young folks for whom these benefits seem far from “essential.”
Obamacare also forces insurers to charge everyone of a certain age the same rate, regardless of their health status or history. On top of that, it prevents insurers from charging older enrollees more than three times as much as younger enrollees.
Charlie Rose is probably still laughing about that with the Obama’s staffers.