The Practical Effects of Obamacare

Governor Scott Walker of Wisconsin has an Op-Ed in the Post today on the practical effects of Obamacare in which he claims:

● 100,000 people will be dropped by their employer-sponsored health insurance;
● 59 percent of people who buy their own health insurance will experience an average premium increase of 31 percent;
● 150,000 people will stop buying health insurance in the private sector and will instead become dependent on the government and taxpayers;
● Between 2014 and 2019, Obamacare could cost Wisconsin taxpayers $1.12 billion; after all federal aid and tax credits are applied, the state’s portion of the bill will be $433 million; and
● Approximately 122,000 parents, caretakers and pregnant women with an income of more than 133 percent of the federal poverty level will no longer be eligible for Medicaid.

It’s important to go beyond these facts and understand what they really mean for those of us who live in the Badger State. Young people will be hit hard with premium increases. Those between 19 and 29 years old who have individual insurance will experience an average premium increase of $1,631 per year. A family of four that does not qualify for a subsidy can expect a 28 percentincrease — from $8,528 to $10,912. For those who are covered by the small-employer group market, the average premium increase will be 15 percent.

To which one can respond as follows:

● More than a million Americans have been dropped by employer-sponsored health plans since 2008 without the Affordable Care Act; the exact number is disputed, but nobody disputes that an ever shrinking number of employers choose to offer full care to their employees. This "unraveling" of the employer-based insurance system is one reason why the ACA is necessary.
● Nobody knows what effect the ACA will have on insurance premiums. What happened in Massachusetts under Romney's essentially identical system was that initial big increases, because of the minimum coverage levels in the law, were followed by a flattening of the cost curve, so that now Massachusetts health insurance costs are no higher than those in nearby states
● Nobody knows how many people will stop buying health insurance. Some cut rate plans will no longer be available, but those plans don't provide a level of coverage adequate to insure against a real health disaster, leaving the people who have them vulnerable to bankruptcy and the rest of us liable for their costs.
● In generous states such as Wisconsin and Connecticut, a few people may lose eligibility for Medicaid, although the White House numbers are much smaller than Walker's. But this would be much more than made up for the millions of new people covered in less generous states.

Really we don't know how Obamacare will play out. We don't know what will happen to premiums, whether the exchanges will work as advertised, whether conservative governors will be able to block them altogether,  whether the cost controls will work, and lots of other things. But we know that the current system is not working. The percentage of Americans with health insurance has gone down every year of this century, and costs have gone up rapidly. What is Governor Walker's solution?

My preferred approach would be a single-payer system with rigid cost controls, but I recognize that Americans are not likely to accept this. With that off the table, some combination of insurance mandates and pools is all but inevitable. A system in which people see whatever doctor they want and get whatever care they think they need, with someone else picking up the tab, is simply not sustainable.