Americans who have been unable to find secure, affordable, comprehensive health-care insurance have much to look forward to when the Affordable Care Act is fully implemented in 14 months— that is, if Mitt Romney doesn’t get the chance to fulfill his promise to immediately dismantle Obamacare.
Americans should know by now that the ACA will make secure insurance more affordable in myriad ways, including wage-adjusted subsidies or tax credits for America’s broad middle class. What Americans may not yet realize, however, is that the ACA also authorizes the participation of two national health insurance plans in the state insurance exchanges that are to be created under Obamacare.
One of these is likely to be the Government Employees Health Association — a nonprofit group that provides insurance for 900,000 federal employees, retirees and dependents. Benefits and premiums for this group are negotiated by the U.S. Office of Personnel Management, which has generally earned a high rating for plans with good benefits and reasonable costs.
In short, Americans who turn to the state exchanges for flat-rate, comprehensive health insurance without pre-existing conditions would be free to select a policy like those that cover members of Congress, the FBI and other federal agencies. That’s sort of a long dream come true. It doesn’t amount to an actual federal parallel public plan like Medicare, which most serious health care advocates had hoped for in health care reform. But the provision requiring two federally approved national insurance groups to compete for customers in the state exchanges will be welcome for several significant reasons.
Their participation will assure that citizens in every state will have access to affordable comprehensive coverage that meets federal guidelines. And it assures that private insurers in state exchanges will have to compete on a level national playing field for quality and price.
Full implementation of the ACA, to be sure, will also end pre-existing conditions exemptions for adults, just as it already has for children. Other provisions — preventive care coverage, flat rates and automatic acceptance for all customers who seek to sign up, bans on annual and lifetime limits, bans on recission of insurance when customers become ill, and requirements that insurers spend at least 80 percent of revenue from premiums on actual health care — will also bar insurers from cherry-picking healthy customers and leaving the ill or less-healthy uninsured.
Another major benefit of the state exchanges having national insurers on board will be the enhanced mobility and insurance security that employees, self-employed individuals and early retirees will enjoy. With most Americans allowed to buy — and, indeed, required to buy — insurance, employees will not be afraid of losing insurance if they change jobs, or try to out self-employment, or choose to retire early.
The benefits of this new dynamic have not been widely discussed, but they are truly broad and important to tens of millions of Americans. The ACA’s sliding-scale subsidies and tax credits to help most uninsured Americans buy health insurance will go to individuals and families with incomes up to four times the federal level. For individuals, they apply to incomes up to $44,680; for a family of four, for example, they would apply to a family income of up to $92,200.
Private insurance companies and health care providers anticipate that the ACA will generate both an increase in the number of insured, and thus less public cost for the care of uninsured people. But insurers and providers also recognize they will have to become more competitive and price conscious. Both trends are expected to reduce the nation’s share of health care spending per capita, now around 18 percent of GDP, while simultaneously reducing the number of uninsured, and securing health care for all.
Those trends all point in the right direction, and mark a milestone for Americans who need and deserve more flexible and secure insurance and health care. Why Romney and Republicans would want to undermine these vast improvements remains to be explained.