Why Our Health Policy Matters More Than Ever in 2014

A single health policy issue will decide who controls Congress after the 2014 election.  Here’s why.

You may have noticed the relative dearth of partisanship emanating from Washington over the past couple of months. 

Congress approved a budget with little fanfare and passed a debt ceiling increase with no hint of strings attached.

There is a reason for this newfound spirit of bipartisanship, and it is not what you think. 

Congress isn’t suddenly taking to heart its relentlessly low approval ratings in 2013.  And it hasn’t just become aware of how unproductive it has been.

Barring an unforeseen catastrophe like 9/11, Katrina, or Sandy, it’s just that members of Congress already know which issue will swing the upcoming election.  And they are not interested in muddying the waters at this relatively late date. 

The Democrats know that they have an advantage in the improving economy, their stand on women’s issues, and their strong support among minorities.

The Republicans know that they gain support because of a still-too-high unemployment rate, unbalanced budgets and the increasing national debt, and an unpopular foreign policy.

But the issue that will swing the Congressional elections in November is the one in which the political advantage then is a little less clear today.  It’s Obamacare.  And that’s proof that our health policy matters more than ever in 2014.

The partisan Congressional lines are arguably drawn more sharply over Obamacare than any other public policy.  We all know of the dozens of party-line Obamacare “repeal” votes that have been taken in the House since its equally partisan passage in 2010.  No other issue comes close for purely partisan controversy.

So what might this mean in the fall?

The current generic Congressional ballot reflects a near dead-heat for the 2014 election, which (because of gerrymandering) would keep the make-up of Congress roughly as it is for another two years.  And the parties have been pretty even on the generic ballot since last October.

What happened in October was that the Democrats lost ground quickly when the initial Obamacare web site problems overwhelmed the news cycles for a month.

As a result, recent polling data suggest that Obamacare is less popular now than ever, with an unfavorability rating 12 points higher than its favorability rating as of February 15. 

From Republicans’ perspective, this is all they can hope for.  Obamacare is the issue that can protect the Republican majority in the House and give the party a fighting chance of picking up the Senate.  Republicans do not want to squander this opportunity by picking new fights they can’t win (and might even cost them their primaries) over deficits and debt ceilings in particular.  So they’ve stopped talking about these for now.

But the Democrats are standing pat because they’re betting that Obamacare will be much more popular in six months than it is today.

The reason is that we’re all beginning to see who is benefiting from the new law – people over the age of 55.

This is a high-voting constituency that went heavily Republican during the 2012 election.  Romney won the 45 to 64 year old demographic by 51-47 percent, and the 65+ demographic by 56-44 percent.

Ever since that election, people on Medicare have been enjoying free annual physicals and improved prescription drug benefits.  And they have not experienced the collapse of the Medicare system that some feared.

As it turns out, baby boomers are flocking to Obamacare, too.  According to one source, 31 percent of the new Obamacare enrollees are 55 years of age or older.  Until now, many of these people had no reason to vote for a Democrat this year.  They had lost their jobs and their insurance during the recession. But now they have insurance again.

Democrats are banking on the fact that they will not risk losing their insurance a second time by voting for a repealing Republican in 2014.

While most people may never understand Obamacare in its entirety, they are just beginning to understand how it affects them personally.  That’s ultimately what matters.

There may still be hand-wringing over fewer than 7 million Obamacare sign-ups this spring or too few young, healthy people in the exchanges, but that will just be background noise to actual voters in the fall. 

What will matter is what this election means for them personally, and that’s why Obamacare may still spring some November surprises.

Paul Gionfriddo via email: gionfriddopaul@gmail.com.  Twitter: @pgionfriddo.  Facebook: www.facebook.com/paul.gionfriddo.  LinkedIn:  www.linkedin.com/in/paulgionfriddo/

Five Fake "Facts" About Obamacare

Last week, I was talking with a new acquaintance about health and mental health policy.

He was a successful businessperson, smart, very well educated, and well-informed about public policy.  Like most of us, he follows the news about Obamacare closely.  And he has strong opinions about it. 

But I realized as we talked that there were things he thought he knew about Obamacare that were not actually true.  But we both had heard them many times before.

So here are five often-repeated “facts” about Obamacare that you, too, have probably heard, and happen to be wrong.

1.  The Affordable Care Act was supposed to reduce health care costs significantly. 

Untrue – when the Affordable Care Act was passed, the Congressional Budget Office projected that it would cost more than $1.2 trillion over ten years.  After the Supreme Court decision in 2012, CBO lowered its projection to under $1.2 trillion.  (When these numbers were updated in 2013, they did not change dramatically.)

The cost of doing nothing was greater – but not by much.  Repealing the Act would cost around $10 billion a year, or less than ten percent more.  So the Affordable Care Act “savings” were always pretty small.

But even those savings were optimistic.  They were based on an assumption that Medicare would cut doctors’ fees by 30 percent – something no one thought would happen.

So the truth is that while some healthcare system costs may be less under the Affordable Care Act, overall the law was intended to be cost neutral.

2.  The Affordable Care Act has failed because it has not lowered large employer-based group health insurance premiums this year.

Untrue – the Affordable Care Act was never intended to lower the sticker price of any insurance premium.  It was only intended to lower the net cost for individual and small group plans by giving tax credits to individuals who (1) earn between 100 percent and 400 percent of poverty and (2) buy their own insurance. 

What ACA did for everyone else was to make sure that they got more for their money by introducing a new set of consumer protections (including minimum loss ratios, coverage for pre-existing conditions, and no cancellations when people get sick) that were not previously guaranteed by federal law or all state regulators.

3.  Under the Affordable Care Act, many working middle-class individuals are still faced with unaffordable health insurance premiums.

My acquaintance talked about the huge burden faced by workers who are paid $35,000 per year – a decent wage, but not an easy one to live on.  He didn’t believe me when I told him that a family of three earning $35,000 could get a “silver” plan – probably comparable to what many large employers offer – for between $100 and $200 per month.

So here’s a link to prove it.  According to the Kaiser Family Foundation’s insurance subsidy calculator, a family of three earning $35,000 per year in my zip code will pay, on average, $156 per month (net) for a silver plan that costs $6641 on the open market.  And if they choose a bronze plan, it will cost them nothing. And in my county there are over one hundred approved plans from which to choose.

4.  The Affordable Care Act was supposed to prevent insurance companies from ever changing or dropping plans again.

Also untrue – but President Obama did famously declare that you could keep your plan if you liked it.  He apparently assumed that people understood that he was making two assumptions here – that the plan met the minimum standards set by the new law, and that the insurance company was still willing to offer it. 

And that leads to the fifth and final “fact” you’ve heard that isn’t true.

5. The Affordable Care Act is at least in part a government takeover of the health care financing and delivery system.

Untrue again – because if it had been, you probably would have been able to keep your existing plan, because the government could have forced your insurer to continue to offer it.

So what is the truth about the Affordable Care Act? 

It is simply this – Obamacare is a balanced approach to reducing the number of uninsured people through a combination of expanded public welfare programs, subsidies to lower and middle class individuals, and private insurance market regulatory reforms.

That’s all.  And that’s a fact.  And its success will be judged ultimately on how well it accomplishes this goal.

And if you want to know how that’s going, click herefor the January 2014 federal report or take a look at the chart accompanying this column.

Paul Gionfriddo via email: gionfriddopaul@gmail.com.  Twitter: @pgionfriddo.  Facebook: www.facebook.com/paul.gionfriddo.  LinkedIn:  www.linkedin.com/in/paulgionfriddo/