Political Animal


September 15, 2011 1:45 PM Affordable Care Act is already working, Part III

By Steve Benen

Most of the provisions in the Affordable Care Act don’t kick in for a few years, but in the meantime, we’re already seeing indications that the law is working as intended.

We talked yesterday about the fact that the number of young adults — those between the ages of 19 and 25 — with health care coverage has gone up considerably, thanks to the new law’s consumer protection reforms. It comes on the heels of reports that the Affordable Care Act is a positive impact on slowing the growth in Medicare spending — a priority Republicans pretend to care about — as hospitals transition to a greater focus on value and efficiency, required under the ACA.

It turns out these aren’t the only signs of progress. Among the many arguments Republicans pushed during the health care debate was the notion that the ACA would crush Medicare Advantage. We can now add this to the (extremely long) list of arguments the GOP got wrong.

Medicare Advantage is the program that gives seniors the option of enrolling in private insurance rather than the traditional, government-run program. The government pays the insurers a flat fee, per enrollee; in return, the insurers provide coverage, sometimes including benefits that traditional Medicare does not. Overall, about one in four seniors belongs to such plans.

The policy rationale for Medicare Advantage is two-fold: To give seniors more options and to introduce some private-sector competition. The idea is that private insurers might be able to be more innovative or offer certain combinations of services that some seniors would prefer. But, for much of its history, the program (formerly known as Medicare-plus-choice) was also a form of corporate welfare. Non-partisan studies, by the likes of the Medicare Payment Advisory Commission, suggested that the government was paying the insurers too much.

The architects of the Affordable Care Act decided, quite sensibly, to reduce those extra subsidies and use the money to offset part of the law’s cost. That’s when the Republicans, and their allies, pounced. Taking money away from the insurers, they claimed, would force insurers to charge more, limit their offerings, or pull out of the market altogether.

As of this morning, it looks like Republicans flubbed this one, too. After reviewing new data from the Center for Medicare and Medicaid Services, which found premiums going down and enrollment going up, HHS Secretary Kathleen Sebelius told reporters, “On average, Medicare Advantage premiums will go down next year and seniors will enjoy more free benefits and cheaper prescription drugs.”

We were paying too much for Medicare Advantage, so we’ve cut costs. The program is, however, still profitable and attractive for private insurers.

In fairness, we’ll need more time to see if this trend holds. It may not. What’s more, not all of the news regarding the law has been positive, as evidenced by an AP report today on cost concerns about the Community Living Assistance Services and Supports program (CLASS).

But overall, most of the initial evidence — on expanding access and coverage, on keeping costs down, etc. — suggests the Affordable Care Act is working. The right doesn’t want to hear that, but it’s true.

Steve Benen is a contributing writer to the Washington Monthly, joining the publication in August, 2008 as chief blogger for the Washington Monthly blog, Political Animal.


Post a comment
  • Burr Deming on September 15, 2011 1:52 PM:

    It isn't so much that conservatives don't want to hear it. It's that they won't hear it.

    Conservative media outlets have gone to Breitbarting the truth, taking small bits to produce impressions what is opposite of reality.

    I'm thinking of a specific here. Remember when testimony demonstrated that older workers might be more likely to retire if they had secure healthcare, like the Obama program, thus easing unemployment? Remember how conservatives edited the testimony to make it seem like the opposite?

  • c u n d gulag on September 15, 2011 2:01 PM:

    "The right doesnít want to hear that, but itís true."

    To paraphrase Paul Simon:

    'The right hears what it wants to hear, and disregards the rest."

  • jackinmpls on September 15, 2011 2:01 PM:

    Yesterday I received the package from my medicare provider for "re-upping" next year. Monthly premium is down and there are some adjustments in co-pays. It's only a few bucks a month, but it's in the right direction. Happy that I can help prove them wrong.

  • goterpsgo on September 15, 2011 2:02 PM:

    @Burr: the morans (aka Teahadists) don't like the truth - they prefer truthiness.

  • mcc on September 15, 2011 2:07 PM:

    "As of this morning, it looks like Republicans flubbed this one, too. "

    "Flubbed". Is the goal to be accurate or produce good policy, or is the goal to discredit health care reform at any cost? Does it matter if the Republicans are wrong, if in the end lots of people heard their endlessly-repeated talking point about Medicare Advantage but not many people hear Sebelius's rebuttal?

  • Harris on September 15, 2011 3:38 PM:

    Down would be nice. Over a five year period my Medicare Advantage premium has doubled.

  • Ron on September 15, 2011 9:24 PM:

    We're on the same page. The republicans and insurance companies are co-conspiraors in separating us from our money, and I support ACA - However - my Medicare Advantage co-pay (for the same policy) went up from $10 to $15 for 2011. I don't know if this is an exception, but I also can't believe that insurance companies would ever lower prices for ANY reason unless compelled by law to do so - which they aren't. They really don't compete, and will get away with the highest prices and least coverage they can get away with. But, I'll see what happens in a few days or weeks. Betcha is remains the same or goes up. It's not that the corruct, amoral republicans are right, but that the ACA is nothing but a baby step, so tiny as to be impotent. Why? Because the republicans watered it down to its present sorry state. We need single-payer coverage, but of course it will never pass unless people get smart. Don't hold your breath.