The ACA's Downfall

My PolicyMic colleague Jennifer Mishory recently disputed my argument that the Affordable Care Act (ACA) is ultimately a bad deal for young adults. Her fundamental premise is that the recent legislation will lower costs and will provide younger and poorer populations access to health insurance coverage for the first time. On these general grounds, Mishory and I completely agree: Increasing access to health care services through reduced costs is a laudable mission, and is actually the desired end-goal for many health care economists of all political stripes. However, I remain unconvinced that the ACA will achieve its intended results; the government does not have the ability to provide services by simply mandating that they be administered or received.

One of the biggest problems I see with the ACA’s solution to access problems is that increasing “coverage” is not the same as increasing access. A perfect example of this distinction lies in the very mechanism the ACA utilizes to expand coverage to about half the total estimate of new insurance enrollees: Medicaid.

Medicaid’s access problems have been well-documented for years. In a recent survey, only 10% of doctors believed that “new eligibles” (people eligible for Medicaid as a result of the new law) will be able to find a “suitable” primary care physician. Earlier, I discussed the story of Deamonte Driver, a 12 year-old Maryland boy, who died from a simple toothache because his mother could not find a dentist willing to take Medicaid patients. Approximately 12 million Americans currently qualify for Medicaid, but choose not to enroll for reasons the ACA does not address, such as poor access and burdensome paperwork.

It is because of these reasons I worry about adding 16 million new beneficiaries to Medicaid, especially at a time when fewer and fewer doctors are willing to take on new patients enrolled in the program. As Medicaid reimbursement to providers worsens, so too will the ability of new enrollees to find a doctor.

Evidence from Massachusetts, a state that implemented a set of health care laws similar to the ACA in 2006, suggests that such reforms will only worsen access issues. Not only does the Bay State have the most expensive insurance premiums in the country, but it also has the worst access problems (measured by average wait time to see a physician).

Universal coverage should not be a goal in and of itself; universal access should be our aim. To be clear, I am not suggesting a government guarantee to access. Starting in 2014, the government will mandate coverage, but an estimated 23 million people will still go without it.  That is hardly “universal coverage.” Enrolling the uninsured in Medicaid or a private health insurance plan and trumpeting this accomplishment before there is concrete evidence of a positive outcome is more of a political strategy than a moral victory. I will hesitate to join in the celebrations until empirical evidence finds that this law will improve our nation’s health, not just its insurance statistics.

Mishory also argues that the law will make health insurance more affordable for 20-somethings. Many have debated whether the ACA will raise or reduce costs overall, but it is impossible to claim it will lower costs for young and healthy adults. By design, the new insurance reforms will force the young and healthy to subsidize care for the older and sicker. Many on the left argue that this is morally superior to the current model, since the older and sicker populations require more treatment. However, the ACA requires that health insurance premiums do not exceed a 3:1 disparity between the young and old, which forces the former to pay more than they currently do. The law could ultimately bring down costs for the average American (although I am still dubious of this claim), but costs will certainly rise for our generation in the short-term.

Overall, I think the move towards better access and lower costs for people our age is greatly needed, but I am skeptical that the ACA will accomplish these goals.

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