The health exchanges established under the Affordable Care Act, also known as Obamacare, opened on October 1, 2013. An analysis by Bloomberg Government shows that competition among health insurance companies on the Health Exchange Marketplace is driving down premiums by as much as a third.
Rates released by the Department of Health and Human Services (HHS) show that the price of policies offered in “rating areas” with 10 or more participating insurers are between 31 percent and 35 percent lower than those for the same policies in areas with only one issuer.
A preliminary review of rates in the remaining 14 to 16 states and the District of Columbia that will run their own exchanges suggests that a similar pattern holds in most.
The pattern shows that at least for 2014 exchanges probably will live up to one of their advocates’ key claims: that the ACA can expand coverage while constraining costs.
House Republicans and the Tea Party are going to extreme lengths to delay, defund, and/or repeal Obamacare. Our question is: Why? The health insurance exchanges are, in some ways, a triumph for market-based conservative ideals.
After all, Republicans supported Obamacare…before Obama. Seriously. Lots of them.
Quick history lesson: In 1986, President Ronald Reagan signed the Emergency Medical Treatment and Active Labor Act (EMTALA), which required all hospitals participating in Medicare (pretty much all of them) to provide emergency room treatment to anyone who showed up. Policy experts began to worry about the “free rider problem,” where people wouldn’t pay for health insurance because they could just show up at the ER if they got sick (this was passed at the same time as COBRA, for those of you keeping score at home).
In 1989, Stuart Butler of the Heritage Foundation, a conservative think tank, wrote a paper called “Assuring Affordable Health Care for All Americans,” in which he proposed the “individual mandate.” That’s the idea, that ended up in Obamacare, that all Americans be required to have health insurance or pay a fine. It’s also the idea that makes the exchanges work: private insurance companies can accept the regulations and “managed competition” of the Health Insurance Marketplace because Americans are required to be customers.
During the health care debate in 1993, Republicans proposed an alternative to President Bill Clinton’s plan that included the individual mandate. Among these Republicans were Newt Gingrich, Orrin Hatch, and Chuck Grassley, who all now rail against Obamacare.
And, of course one-time Obama opponent Mitt Romney included an individual mandate in his health care plan as governor of Massachusetts. Here’s what he said in April 2006:
…we’ve come up with something that’s much closer to Republican ideals: reform the market to make the health-insurance marketplace work better. Insist on personal responsibility instead of government responsibility.
Now, since that time, Romney, Gingrich, and even Heritage’s Stuart Butler have twisted themselves into pretzels saying how different their ideas are from Obamacare, detailed here by Forbes’ Avik Roy. And yes, the Affordable Care Act is a large bill containing various components that some people like and some don’t. But the idea of private health insurance companies competing for customers in the free market is a (small-c) conservative idea, an idea supported by the Republican Party in various ways over the past 30 years.
So instead of shutting down the government and throwing tantrums, conservatives should be beaming with pride. You got Democratic President Obama and a Democratic Congress to pass one of your ideas into law. And so far, it ain’t half bad!
Get the most out of the Affordable Care Act. Sign up at WorkingAmericaHealthCare.org today.
