When Obamacare passed in 2010, the law’s drafters wanted to build something very new in American health care.
In particular, they wanted to create marketplaces (“exchanges”) through which consumers could receive government help to buy private insurance. A big part of Obamacare thus centered on making sure these new marketplaces would work for both consumers and insurance companies, creating a complicated framework aimed at making this private-public collaboration work for everyone.
There are now a lot of signs that these exchanges are not nearly as workable as some experts had hoped. Premiums on the marketplaces are set to soar by 22 percent this year. Insurers are fleeing the exchanges in droves. The new rate hikes may force people out of the markets.
One set of questions this immediately surfaces is what should be done in the short term to fix the law’s immediate failings. But it also raises the question of whether the marketplaces created by Obamacare were the right idea in the first place — or if just directly giving the poor money for medical coverage would have been a simpler and more efficient solution.
On the latest episode of The Weeds podcast, Vox’s Sarah Kliff, Ezra Klein, and Matt Yglesias get deep into the policy obstacles facing Obamacare, talk about the law’s design and implementation, and try to game out the law’s fate — particularly in the rural areas where it seems most imperiled. (You can listen to The Weeds’ Obamacare special below or by downloading the show.)
Here’s Yglesias, talking through whether there was a better way forward when Obamacare was being drafted seven years ago:
One of the aspirations of the Affordable Care Act was to create a program that people would like — the way if someone came up to you and said, “Let’s not have Social Security, or high school,” you’d say, “No, I like those things! High school is good!” In other words: a social service people would use and embrace.
The exchanges are failing to do that. They are succeeding at subsidizing people who are eligible for subsidies — so the law is helping a lot of people onto Medicaid, which is amazing for them. The exchanges themselves are working like a Medicaid Plus, especially in these really rural areas, as a very inefficient Medicaid.
And it just re-raises the whole, from the left, critique of the Affordable Care Act. Which is: Why are we doing this? What is the point of this extremely complicated apparatus? Why have the second cheapest “silver plan benchmark” of whatever, whatever, whatever? It seems like we have not discovered a better way of delivering health care to people through Obamacare, or of collecting enough revenue to make sure everyone has insurance. There’s this enormous Rube Goldberg contraption that is not giving many people meaningful choices; it’s not creating workable solutions to middle-class, self-employed people. In terms of ways to boost the incomes of poor people, it’s very roundabout.
You could just give everyone checks, and they could use them to buy insurance or buy Skittles or whatever. Or you could have just expanded Medicaid. It seems to me like it’s really the case, unless substantial changes are made through Congress, that this won’t achieve the lofty goals that were set up.
More Obamacare-related reading you should do, much of it cited on the latest episode of The Weeds:
- Sarah Kliff’s must-read story “Is Obamacare failing?”
- Kliff’s basic primer on what Obamacare is and how it works
- Why it’s so dangerous that competition among insurers has plummeted from last year
- The proposal from Alaska Sen. Mark Begich to add “copper plans”
- A Q&A interview with Caroline Pearson, of the health research firm Avalere, about what’s going wrong with the law now
- The argument that what Obamacare needs is a tougher individual mandate to force people onto the exchanges
- If you’re stretched for time, Vox also has a useful 400-word summary of the problems facing Obamacare.