As efforts to extend health insurance subsidies have stalled, one negotiator, Ohio Republican U.S. Sen. Bernie Moreno seemed to blame former President Barack Obama’s signature health care law, the Affordable Care Act.
“You gotta remember, Democrats created Obamacare,” NPR reported him as saying in late January. “It’s been an abject failure in terms of lowering costs.”
Is that really the case?
Congressional Republicans allowed subsidies for more than 400,000 Ohioans buying insurance under the Affordable Care Act to expire at the end of last year.
Costs for the average person more than doubled with the loss of the subsidies. In their wake, an estimated 113,000 Ohioans have already lost coverage altogether.
Nationally, about 42 million Americans were using the subsidies when they expired.
More than 1 million have lost coverage already, KFF reported earlier this month, and 4.8 million are expected to become uninsured by the end of the year, the Urban Institute reported in September.
Moreno and other Republicans in Congress allowed those subsidies to expire months after they renewed President Donald Trump’s 2017 tax cuts, which are heavily weighted in favor of the wealthiest Americans.
Extending the subsidies would have cost about $350 billion over the next 10 years, while the tax cuts will provide a $1 trillion windfall just to the richest 1% over the same period.
The ACA subsidies mostly benefitted lower-income Americans, with 70% of recipients earning less than 250% of federal poverty guidelines.
For an individual, that’s just under $40,000 a year.
The Trump spending law also took a huge bite out of programs for the poorest Americans.
It cut Medicaid spending by nearly $1 trillion over 10 years, and it cut $186 billion from a federal food assistance program under which many states are already doing a woeful job of serving eligible people.
Bipartisan talks to revive the subsidies stalled late last month.
Moreno accused Democrats of not wanting a solution, but an issue to run on.
For their part, Democrats accused Republicans of inserting a poison pill in the form of anti-abortion rules governing health savings accounts.
It’s in this context that Moreno claimed that the Affordable Care Act has failed its promises to save money.
When they heard the claim, several critics were quick to point out that in 2009 Republicans opposed the “public option” — a measure in the original ACA that supporters said was one of the most potent ways of bringing down health care costs.
It would have been a government-sponsored plan offered on the insurance exchanges that would compete with private plans and leverage the government’s buying power to drive down prices charged by providers.
There is also considerable evidence that while the ACA didn’t make health care cheaper on a nominal basis, it made prices rise less quickly.
This fact check points to a 2020 study by the Journal of the American Medical Association finding that out-of-pocket health costs rose on average of 3.4% a year over the decade before the ACA.
That rate slowed to 1.9% a year over the nine-year period after its passage, the fact check said.
Ezekiel Emanuel, an oncologist and co-director of the Health Care Transformation Institute at the University of Pennsylvania, wrote a 2023 opinion column in Stat News giving his take on why medical inflation slowed in the wake of the ACA’s passage.
The law created incentives for doctors to control costs, he said.
“The mindset of American physicians and other clinicians has changed, from ignoring costs to trying to cut them,” Emanuel wrote.
“Instead of figuring out more expensive medical tests and treatments, doctors are now asking whether a test or treatment will improve a patient’s health and how a service can be performed more efficiently by shifting where and how it is administered.“
Moreno’s office was asked whether he agreed the ACA had slowed the rate of medical inflation.
“The facts don’t lie: the Affordable Care Act was never affordable,” Communications Director Reagan McCarthy said in an email.
“Premiums and deductibles for individuals and families have skyrocketed while Democrats’ signature legislation bailed out health insurance companies on the back of taxpayers. It’s a shame that Chuck Schumer rejected a good-faith, bipartisan effort to lower health care costs.”
McCarthy didn’t point to any evidence that medical inflation accelerated as a consequence of the ACA.
When it comes to per-capita, out-of-pocket costs, they’ve grown from $1,299 in 2010 to $1,514 in 2023 when the amounts are expressed in 2023 dollars, KFF reported.
That’s about a 17% increase.
Over a similar period before the ACA, they rose from $979 in 1997 to $1,314 in 2009 — a 34% increase.
When you look at total national health spending in terms of 2023 dollars on a per-capita basis, they grew about 57% between 1997 and 2010, and about 29% between 2010 and 2023.
McCarthy didn’t respond directly when asked whether creating millions more uninsured people will cost all Americans.
With the passage of the ACA, the rate of uninsured Americans has plummeted from 17.8% in 2010 to 9.5% in 2023, KFF reported.
In 2009, about 46.5 million Americans were uninsured. By 2023, the number of uninsured Americans was down to 25.3 million, a historic low.
Several experts predict that the expiration of ACA subsidies and the Trump spending bill will create millions more uninsured, and rates of uninsurance will return to where they were in the early years of the ACA.
One direct cost from having high rates of uninsured Americans is “uncompensated care” — the bills everybody else has to cover when people can’t pay themselves.
The Congressional Budget Office last year predicted that the spending law alone will add 11 million Americans and 440,000 Ohioans to the ranks of the uninsured by 2034.
The Center for American Progress last year did an analysis indicating that that would increase uncompensated care costs by nearly $1 billion in Ohio that year and $36 billion nationally.
Emergency departments feel the particular brunt of uncompensated care because they can’t turn people away based on their ability to pay.
Last year, Ohio emergency room doctors warned that increasing uncompensated care would increase wait times for all patients and push some already-stressed rural hospitals out of business.