Why Congress should fix the Affordable Care Act
It’s hard to find anyone other than Republican members of Congress who think the current proposals to “repeal and replace” the Affordable Care Act are good policy. The proposals are opposed by doctors, nurses, hospitals, faith leaders, insurance providers, AARP and likely by the 22 million Americans who will lose their health care if these plans are adopted. Fortunately for America’s working families, seniors, the very ill and those with pre-existing conditions, these plans have stalled.
My Democratic colleagues and I will continue to vigorously fight these current harmful measures. But that doesn’t mean that we should do nothing. The ACA was such a huge undertaking that it was bound to need fixes over time, so Democrats should not be defensive about seeking ways to repair and improve what’s not working.
The good news is our health uninsured rate is at an all-time low of 9 percent. In San Diego County, just 5 percent lack health insurance, down from 17 percent a few years ago. But there is trouble in individual markets in some parts of the country, where insurance companies are reluctant or unwilling to sell individual policies on the federal or state exchanges. And even though less than 10 percent of Americans get their insurance through the individual markets, market uncertainty in the individual markets also increases the costs of employer-provided plans. In the past two months, I’ve met with representatives from successful state exchanges, academia and insurers, and have identified the following steps to stabilize individual insurance markets and keep insurance available.
First, Congress should reauthorize and make permanent federal reinsurance programs, which protect insurers against the costliest medical claims. Without a sufficiently funded reinsurance program, insurers with sicker enrollees would have to charge higher premiums to all of their customers to stem their financial losses. That means larger subsidies being paid by the federal government and higher out-of-pocket costs for everyone. The stabilization funds included in the Republican House and Senate bills are not sufficient to keep costs down. As applied by the Affordable Care Act, the transitional reinsurance program helped reduce average premiums by 10 percent to14 percent in 2014. Congress should make this program permanent to keep costs down and insurers in the exchanges.
Second, Congress should shield Cost-Sharing Reduction Subsidies (CSRs) from the uncertain appropriations process, and commit to long-term funding. These subsidies reduce out-of-pocket health care costs for hardworking American families. If CSRs ended, insurance would become unaffordable for many, more insurers would hike premiums or leave the exchanges altogether, and the federal government would foot the bill for newly uninsured families flocking to the emergency room for basic care. Today, insurers don’t know what will happen with CSRs from month to month, and that risk for them means higher premiums. Congress should end the uncertainty in the insurance market and commit to consistent funding over time.
Third, one of the most important ways to keep insurance available and premiums down is to get young, healthy people into the insurance pool. The ACA tries to do this with an “individual mandate” — everyone has to get insurance or pay a fine. But the Trump administration has signaled that it opposes and will not enforce the individual mandate. As an alternative to the mandate, Congress could authorize an automatic enrollment system, where young individuals who do not purchase insurance would be automatically enrolled in an inexpensive health plan that covers basic primary care and catastrophic illness or injury. These plans would simultaneously foster consumer choice and help reduce risk in markets through the enrollment of the young and healthy. But we must act. Without enforcement (or effective replacement) of the current mandate, average premiums in 2018 and 2019 are projected to increase 15 percent to 20 percent higher than they would otherwise.
Washington must continue working to find ways to lower the costs of health care, and there will be legitimate differences on policy and ideology. But many individual insurance markets need help today, and the fixes are available and need not be partisan. There are broader proposals out there, but these are steps that we can take right now to stabilize the individual markets. This is what Congress should be doing: protecting what is working in our health care system and helping fix what isn’t. That would be a good step toward repairing a broken Congress and making health care more affordable and accessible for every American.
Peters, D-San Diego, represents California’s 52nd Congressional District. He serves on the Energy and Commerce Committee, which has jurisdiction over health care.