The Affordable Care Act in 2017: Myths and Facts

Facts should be key to participating in the debate about the Affordable Care Act (ACA) and its future. To help separate what is true from what is often stated, we offer the following Myths and Facts.

ACA Myths

ACA Facts

Affordability

The ACA makes it too hard for middle-income Americans to purchase insurance in the individual Marketplace. The ACA has significantly lowered these costs.[1] Almost 83%, or 10.5 million of the 12.7 million people insured through the ACA Marketplace received the law’s premium subsidies from November 2015 to February 2016.[2]

The rise in premiums in recent years is the result of rising health care costs nationwide.[3] The ACA included a number of provisions that will drive down these rising amounts. For example, ACA created a Medicare innovation center that experiments with ways of driving down some of these rising costs.

The Affordable Care Act continues to make Marketplace plans more affordable. The ACA’s Marketplace subsidies have kept up with rises in Marketplace premiums and have made health care more affordable.[4] Moreover, premiums are rising at a much slower rate than they were prior to the implementation of ACA – one of the slowest rates in the last 50 years.[5]

Essential Benefits

The ACA made people buy benefits they do not need. “Health insurance, like all insurance, works by pooling risks. The healthy subsidize the sick, who could be somebody else this year and you next year. Those risks include any kind of health care a person might need from birth to death – prenatal care through hospice. No individual is likely to need all of it, but we will all need some of it eventually.”[6]

The ACA requires plans to offer coverage for essential services. The ACA requires all plans to offer some coverage for mental health and substance abuse care, rehabilitative care such as physical therapy, as well as preventive and pediatric services, including pediatric vision and oral health care.[7]

Furthermore, the ACA adds numerous preventive benefits to medicare with no cost-sharing. Many services covered by ACA Marketplace plans, such as preventive visits and annual checkups, that are provided outside of the deductible.[8]

Employer Mandate

The ACA’s requirement that employers with 50 or more employees offer health insurance to their employees is a “job killer.” There is no evidence that the ACA’s Employer Mandate has negatively impacted employment. On the contrary, employment numbers have actually increased since the ACA was enacted.[9]

Not only are companies retaining their employees, they are also continuing to offer them employee-sponsored health insurance.

The Urban Institute states that eliminating the Employer Mandate would have little effect on the hiring practices of companies because firms desire to offer health insurance in order to attract the most qualified workers. [10]

Individual Mandate

The government does not need to force people to buy insurance in order to expand coverage. In order to offer important and popular provisions such as coverage for persons with preexisting conditions and eliminating coverage caps, the insured pool needs to include healthy people paying for coverage, to help spread the risk and costs. This is the basis of all insurance.  Health insurance, like other kinds of insurance, pools together the costs of costlier and less costly consumers.[11]

The individual mandate is key to ACA’s success in vastly increasing the number of people who have insurance. In 2010, 16% of the country’s population was uninsured. In 2016, only 8.6% of the country was uninsured. 91.4% were insured.[12]

Stability of the Marketplace

The individual marketplace is currently on a “death spiral” and not doing well. According to the Congressional Budget Office’s March 2017 estimate, ACA’s individual Marketplace is currently stable and the cost of buying health insurance is not out of reach for subsidized enrollees.[13]

A March 9, 2017 New England Journal of Medicine Article notes that “the available data on the health insurers participating in the Affordable Care Act exchanges reveal patterns of market entry and exit that are consistent with natural competitive processes separating out firms that are best suited to adapt to a new market… Efforts to reform or replace the ACA should therefore proceed with the knowledge that highly publicized market exits are a poor and probably inaccurate signal of a failing market.[14] (emphasis added)


[1] Premiums have gone up, but the ACA has kept them much lower than they otherwise would have been. On average, ACA subsidies made premiums in 2014 were 17 percent lower than they were in 2013 thanks to the ACA’s subsidies. In 2016, subsidies made premiums 10 to 21 percent lower than they were in 2009 prior to the provision of the ACA’s helpful subsidies. See: Loren Adler and Paul B. Ginsburg. “Obamacare Premiums Are Lower Than You Think.” Health Affairs Blog. 21 July 2016. http://healthaffairs.org/blog/2016/07/21/obamacare-premiums-are-lower-than-you-think/ (site visited March 15, 2017).
[2] Bob Herman. Vast Majority of ACA Enrollees Still Receiving Subsidies.” Modern Health care. 11 March 2016. http://www.modernhealth care.com/article/20160311/NEWS/160319974 (site visited March 15, 2017). “Health Insurance Marketplaces 2016 Open Enrollment Period: Final Enrollment Report.” Department of Health and Human Services. 11 March 2016. https://aspe.hhs.gov/system/files/pdf/187866/Finalenrollment2016.pdf (site visited March 15, 2017). Kaiser Family Foundation has provided information on the level of subsidies individuals and families could receive under the ACA. “Explaining Health Care Reform: Questions about Health Insurance Subsidies.” Kaiser Family Foundation. 1 November 2016. http://kff.org/health-reform/issue-brief/explaining-health-care-reform-questions-about-health/ (site visited March 15, 2017).
[3] Ibid.
[4] Alison Kodjak. “Rates Up 22 Percent For Obamacare Plans, But Subsidies Rise, Too.” NPR. http://www.npr.org/sections/health-shots/2016/10/24/499190020/rates-rise-again-for-obamacare-health-plans-but-so-do-subsidies (site visited March 9, 2017).
[5] Ezekiel Emanuel and Bob Kocher. “Higher Health-Insurance Premiums Don’t Mean the Affordable Care Act Is a Disaster.” Washington Post. 27 October 2016. https://www.washingtonpost.com/opinions/higher-health-insurance-premiums-dont-mean-the-affordable-care-act-is-a-disaster/2016/10/26/1b7f7ce0-9b84-11e6-a0ed-ab0774c1eaa5_story.html?utm_term=.3f8d5eaef329 (site visited March 15, 2017).
[6] Elise Viebeck. “‘Is that Not Correct?’: Male GOP Lawmaker Asks Why Men Should Pay for Prenatal Coverage.” Washington Post. 9 March 2017. https://www.washingtonpost.com/news/powerpost/wp/2017/03/09/is-that-not-correct-male-gop-lawmaker-asks-why-men-should-pay-for-prenatal-coverage/?utm_term=.a2c7ef7dd2e1 (site visited March 15, 2017).
[7] Alexandra Ernst. “10 Essential Health Benefits Insurance Plans Must Cover Starting in 2014.” Families USA. 28 March 2013. http://familiesusa.org/blog/10-essential-health-benefits-insurance-plans-must-cover-starting-in-2014 (site visited March 9, 2017).
[8] Bob Herman. Vast Majority of ACA Enrollees Still Receiving Subsidies.” Modern Health care. 11 March 2016. http://www.modernhealth care.com/article/20160311/NEWS/160319974 (site visited March 15, 2017). “Health Insurance Marketplaces 2016 Open Enrollment Period: Final Enrollment Report.” Department of Health and Human Services. 11 March 2016. https://aspe.hhs.gov/system/files/pdf/187866/Finalenrollment2016.pdf (site visited March 15, 2017). Kaiser Family Foundation has provided information on the level of subsidies individuals and families could receive under the ACA. “Explaining Health Care Reform: Questions about Health Insurance Subsidies.” Kaiser Family Foundation. 1 November 2016. http://kff.org/health-reform/issue-brief/explaining-health-care-reform-questions-about-health/ (site visited March 15, 2017).​
[9] Jon Greenberg. “Ted Cruz’s Pants on Fire Claim that Health Care Law is Nation’s ‘Biggest Job-Killer.’” PolitiFact. 29 January 2016. http://www.politifact.com/truth-o-meter/statements/2016/jan/29/ted-cruz/ted-cruzs-pants-fire-claim-health-care-law-nations/ (site visited March 15, 2017).
[10] Linda J. Blumberg, John Holahan, and Matthew Buettgens. “It’s No Contest: The ACA’s Employer Mandate Has Far Less Effect on Coverage and Costs Than the Individual Mandate.” Urban Institute. July 2013. http://www.urban.org/sites/default/files/publication/23816/412865-It-s-No-Contest-The-ACA-s-Employer-Mandate-Has-Far-Less-Effect-on-Coverage-and-Costs-Than-the-Individual-Mandate.PDF (site visited March 10, 2017). P. 3.
[11] Steven Pearlstein. “Donald Trump Is about to Face a Rude Awakening over Obamacare.” Washington Post. 12 November 2016. https://www.washingtonpost.com/news/wonk/wp/2016/11/12/donald-trump-is-beginning-to-face-a-rude-awakening-over-obamacare/?utm_term=.24b5e143ed87 (site visited March 15, 2017).
[12] Dan Mangan. “Obamacare Pushes Nation’s Health Uninsured Rate to Record Low 8.6 Percent.” CNBC. 7 September 2016. http://www.cnbc.com/2016/09/07/obamacare-pushes-nations-health-uninsured-rate-to-record-low.html (site visited March 9, 2017).
[13] Congressional Budget Office. “American Health Care Act.” 13 March 2017. https://www.cbo.gov/sites/default/files/115th-congress-2017-2018/costestimate/americanhealth careact.pdf (site visited March 15, 2017). P. 2.
[14] Craig Garthwaite, Ph.D., and John A. Graves, Ph.D. N Engl J Med 2017; 376:907-910 March 9, 2017 DOI: 10.1056/NEJMp1614545.