By Arthur Vidro
March 23 marks the 11th anniversary of the signing into law of the Affordable Care Act, also known as Obamacare.
The act passed in 2010 and, after a shaky start, has worked smoothly overall. When it was first voted on by Congress, I might have voted against it. I thought the requirement for healthy people to purchase insurance, known as an individual mandate, was unconstitutional. But without that mandate, I thought the law would be constitutional and, although far from perfect, desperately needed.
Obamacare, including the individual mandate, took effect at the start of 2014. Legislation in December 2017 eliminated the federal penalty for violating the mandate, as of the start of 2019.
However, some states mandate its citizens to have health insurance. Which is one factor that led to California v. Texas, now on the Supreme Court docket; some oral arguments have already been heard. The case will decide, once again, if Obamacare is constitutional. It has survived challenges before and will likely survive this one too.
Instead of living with Obamacare, many folks keep challenging the act.
I wish they’d leave it alone.
Obamacare has been a blessing to millions of this nation’s citizens. Many of us need Obamacare. Many employers do not provide its workers with health insurance. Also, nobody gives the self-employed health insurance. So Obamacare comes in mighty handy.
One great thing about Obamacare was its elimination of the dreaded “pre-existing condition” clause, which was used by health insurers to avoid paying medical claims, leaving the patient to foot the entire bill.
Insurers are in business to make money. That’s why the older a person is, the more their health insurance premiums will be. As we age, we are at higher risk for injury and illness and more likely to receive frequent medical treatment. I don’t begrudge insurers for charging more to those of us who are, let’s say, middle-aged.
But to keep their business model working, they charge an arm and a leg. Which many of us can’t afford.
The ever-escalating premiums stop when a person reaches 65. That’s when Medicare kicks in, and its premiums are much friendlier.
But before one reaches Medicare age, especially for folks 50 to 64, premiums are astronomical. That’s true even with Obamacare, which doesn’t lower the premiums, but instead directly pays a portion of the premium to the insurer. That makes the insurance affordable to those who sign up for a policy. The insurer gets its money, much of which comes from public (taxpayer provided) funds.
The less income a policyholder has, the higher the government’s payment to the insurer. As one’s income goes up, the government’s payment goes down, until the truly wealthy don’t receive any government subsidy.
For example, my friends Virgil and Della are both in their late-50s. He is self-employed, she works for a large local employer that does not provide health benefits. They both get health insurance through Obamacare.
For the two of them combined, the monthly premium for their no-frills policy is $1,355 (and would be much higher if either of them smoked). That’s based on their ages. But $1,355 a month far exceeds their ability to pay. If Obamacare did not exist, they would be without health insurance.
Their monthly payment to the insurer, based on their income, is $225. The government’s formula has determined, in this case correctly, that’s what they can afford. The government pays the remaining $1,130.
Before Obamacare came along, Virgil and Della were younger, yet priced out of the health insurance market. They bought emergency-only policies with huge deductibles, but at least they were covered for hospitalization. They avoided going to doctors, because it was too costly to do so.
Most health insurers are publicly traded mega-giants with boards of directors and executives who focus on generating profits for shareholders; profit is achieved by collecting premiums and limiting their payments on claims.
Whether it’s car, life, house, health, fire, or some other insurance, insurers exist to earn a profit.
One exception is flood insurance. To insure homes in at-risk locations, insurers have to charge prices that are so high they have scared away nearly all the potential buyers. So private flood insurance pretty much doesn’t exist.
Instead, we have the National Flood Insurance Program, implemented in 1968, which provides 95% of the nation’s flood insurance policies – some 5.1 million. When disaster strikes, they pay out. Where does the money come from? Our taxes.
Because of the payouts, flooded-out homeowners rebuild in the exact same spots, and then the process repeats itself. But the homeowners don’t care, because they’re paying comparatively little for their insurance.
Until someone comes up with a better system, that’s the way it is.
Likewise with health insurance.
The many debates about Obamacare’s pluses and minuses have led people to try to think of better alternatives – such as Medicare for All, or Medicare for a Larger Age Range. Such discussions are healthy and should continue. Perhaps someday we’ll figure out a better way.
In the meantime, for those of us too old to risk going without health insurance but too young for Medicare, Obamacare has been a true blessing.
Happy 11th anniversary.
Arthur Vidro’s latest short story, “Which Casino?” appears in the November 2020 issue of Mystery Weekly Magazine.