In a session at AMCP Nexus 2019, Melissa Andel, MPP, vice president of health policy, Applied Policy, covered the current state of health insurance coverage in the United States, major actions from the Trump administration impacting the Affordable Care Act (ACA), public sentiment around the ACA, and what stances presidential candidates have taken on healthcare.
Plans purchased on the Affordable Care Act (ACA) exchanges only represent 3% of Americans, but reform efforts related to the ACA remain a large part of health policy, explained Melissa Andel, MPP, vice president of health policy, Applied Policy, during a session at AMCP Nexus 2019 that covered the current state of health insurance coverage in the United States, major actions from the Trump administration impacting the ACA, public sentiment around the ACA, and what stances presidential candidates have taken on healthcare.
Almost half of Americans still receive their insurance from their employer, but an estimated 20 million Americans gained coverage overall after the implementation of the ACA due to changes such as the exchanges, Medicaid expansion, and children being able to stay on their parents’ insurance until age 26.
While the uninsured rate has been increasing since 2016, it remains below pre-ACA levels, Andel noted. The subgroups with the largest increases in uninsurance since 2016 are women (+3.9%), Americans aged 18-34 (+4.8%), and households with income less than $48,000 a year (+5.8%).
What’s behind the increase? “I think there are a lot of variables in play,” Andel said. The individual market is “inherently unstable” and subject to a lot of churn.
Other factors that may have contributed to the rising uninsured rate, although it is not clear how much, are increasing premiums, shorter open enrollment periods, reduced funding for navigators and marketing, general confusion regarding the individual mandate and whether or not the ACA has been repealed, and a general lack of awareness, especially among the lower-income population. For instance, people who now qualify for Medicaid in a state where the program was expanded might not know they are eligible and there are people who don’t realize they qualify for subsidies and so they go uninsured.
“We don’t have a way to sort of narrow down and focus specifically what’s driving the increase here,” Andel said.
However, even as enrollment numbers decline, subsidized enrollment is stabilizing and has actually increased. Households that were not eligible for subsidies were quickly priced out of the market when premiums increased, she explained, with enrollment for those not eligible for subsidies dropping from 6.2 million in 2016 to just 1.3 million in 2019. In 2019, the average monthly premium was $594 and the average premium tax credit was $514.
“So, for folks that were eligible for the tax credit, they were actually able to get a really reasonable price on their plan,” she said.
One of the Trump administration’s actions that impacted the average tax credit was the decision to stop refunding cost-sharing reduction (CSR) payments. When the ACA was written, it required that plans reduce cost sharing for some enrollees, but the legislation did not appropriate the funds. When the Trump administration stopped funding the CSR payments, the plans still had to offer cost-sharing reduction by law.
As a result, the majority of plans took an action called “silver loading,” through which the plans loaded all the costs into the premiums of the silver plans, which were the only ones eligible for CSR payments, instead of spreading the costs out over the plans on the exchange. According to a Congressional Office Budget (CBO) report, the average silver plan premiums increased by 10% in 2018 simply due to this policy change.
In 15 states, silver plans had premiums higher than gold plans, and the average premium tax credit values increased along with that change. As a result, it was actually cheaper to buy more generous plans in some states. The CBO report also projected that as a result, an additional 2 million Americans would purchase coverage due to the more generous subsidies, which would increase federal costs by $10 billion between 2019 and 2021.
“I think that [ending the CSR payments] is actually probably the most disruptive move,” Andel said. “I think a lot of people assume [repealing the individual] mandate is the most disruptive move. I think this one is the one that’s actually been the most disruptive to the individual market.”
She also noted the Trump administration’s efforts to loosen regulations by expanding the use of loosely regulated plans, such as association health plans, short-term limited duration plans, and employer arrangements.
The ACA has grown more popular with the American public over time; unfavorable opinions spiked in late 2013 when the law was preparing to roll out, but since January 2017, more Americans have a favorable view.
General Healthcare Sentiments
Beyond the ACA, Americans’ opinion on healthcare in general is complicated. In general, people like their employer-sponsored insurance (ESI) with 67% rating it good or excellent, but they don’t always use positive words to describe their insurance. A Kaiser Family Foundation (KFF) survey found that 58% of respondents said they feel grateful and 50% were content with their ESI, but they also said they were frustrated (40%), confused (34%), and angry (23%).
“I do think it’s kind of interesting that we see like a larger portion of Americans that are angry or confused, but they don’t seem willing to give their health plan a D or an F because of their anger or confusion,” Andel said.
Furthermore, affordability remains the top concern with 40% reporting having trouble affording care in the last year, 18% admitting to skipping or halving doses or not filling a prescription, and 14% reporting that they had trouble affording co-payments for prescription drugs.
These findings help “shed light” on the broader healthcare debate in the country. The single payer/”Medicare for All” debate is a coverage issue, but it is mostly being driven “by a desire to eliminate or reduce out-of-pocket spending,” she said.
Medicare for All or ACA 2.0
Medicare for All and single-payer coverage are 2 different things that are commonly referred to as the same thing. A KFF survey found that Americans are fairly receptive to both concepts, although the responses broke mostly along party lines, but that Medicare for All means different things to different people. More than three-fourths (78%) accurately stated that taxes would increase under Medicare for All, but 69% seemed to think that co-pays and deductibles would still exist. In addition, 55% thought they would keep their insurance if they got it through their employer.
Andel then took a look at the 4 Democratic presidential candidate frontrunners: Vice President Joe Biden, Senator Elizabeth Warren, Mayor Pete Buttigieg, and Senator Bernie Sanders. The 4 candidates essentially fall into 2 camps: those in favor of ACA 2.0 and making improvements to the current law (Biden and Buttigieg) and those in favor of Medicare for All (Warren and Sanders). Andel did note that Warren has not actually released a healthcare plan yet, but she is a cosponsor of Sanders’ Medicare for All legislation.
The ACA 2.0 candidates may have an edge among the public. KFF found that 55% of respondents would prefer to vote for a candidate looking to build on the existing ACA compared with 40% who would vote for someone looking to replace the ACA with Medicare for All. Of the people who prefer Medicare for All, 22% said they would be ok voting for a candidate looking to build on the ACA.
However, even if a Democrat wins the White House next year, the GOP is likely to hold on to the Senate, which will make pushing through any legislation difficult. Even if the Democrats flip the Senate and hold the House, they will do so because of moderate Democrats, which means even if Warren or Sanders is elected, the legislation going through Congress will be more moderate.
“So, I think that a lot of proposals under discussion in the Democratic primary right now would never be implemented in their current form just absent like a significant shift in overall public opinion or reformed to get moderate support,” Andel said. “I just really don’t see the path forward.”