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It was the gift that kept on giving: The disastrous roll-out of the health-insurance exchanges provided daily fodder for Republican opponents of Obamacare. And the dire state of U.S. health care, coupled with a headlong rush by people to get health insurance, gave Democrats ample opportunity to say “we told you so.”
So once it’s January 2014 and people can start having their new insurance and all the deadlines have passed, can we relax and talk about something other than health reform?
Not a chance, say experts. They predict 2014 will be, if anything, worse than 2013.
“It will be an election year, and the GOP has pledged to make the Affordable Care Act one of its top issues. So yes, I think we can expect even more politics,” says Sabrina Corlette, senior research fellow at Georgetown University’s Health Policy Institute.
“Scary thought, I know.”
The health-insurance exchanges were supposed to be the crowning glory of the 2010 Affordable Care Act, now known widely as Obamacare. The new law was designed to get health insurance to the 45 million Americans who don’t have any.
It’s also meant to lower costs and improve quality of care over time by helping people get treated earlier, before they develop expensive conditions, and by encouraging doctors, hospitals and other providers to work more closely in collaboratives called Accountable Care Organizations.
The federal government has ended up doing the heavy lifting on the exchanges, running them for 36 states. Almost as soon as they opened, it became horribly clear they weren't working.
“They have not done a very good job. That’s an understatement,” says Henry Aaron of the Brookings Institution. “With time, I am sure they will get it right.”
For the early part of 2014, however, this will mean lots of questions about who is covered and who isn’t. One fear is that people will think they signed up for coverage even if they didn’t take the final and vital step of paying the first premium, and will seek care. Another problem: The system has been passing along erroneous information to insurers, something the Health and Human Services Department has been racing to fix.
“When people try to use their benefits, we’ll find out if information transmitted to insurers,” says Matt Eyles of health-care consulting firm Avalere Health. “Were people getting billed for the correct amount? Are the plans collecting the correct amount?”
In emergency rooms on Jan. 1, “there are going to be people out there who think they are insured … but who can’t connect with an insurance plan,” says Timothy Jost, a professor at Washington & Lee University who’s a supporter of the ACA. “These transitions are always bumpy. This one is going to be particularly bumpy.”
Everything that goes wrong will get picked up and amplified on talk shows, in editorials and in Congress, the experts predict. Douglas Holtz-Eakin, a health-policy expert who heads the center-right-leaning American Action Forum, imagines an easy target if insurance subsidies "start going to phonies and prisons and dead people." Payment cutbacks and limited networks could also come under attack.
Jost agrees that limited networks could be a big issue. “It is one way that health plans can compete because they can’t compete by cherry-picking patients anymore,” Jost says.
The law forbids insurance companies from turning away clients and also limits how much more they can charge someone because of age. They can vary premiums based on whether a person is a smoker, and on geography, but that’s about it. So instead, many will limit where customers can get care.
“Narrower networks are less expensive,” Jost says. “It really gives the plans more bargaining power. They can say ’if you can give us a discount , we’ll give you patients.'"
People will squeal, but studies show that the care is just as good for most people using a narrow network of doctors and hospitals as those who have more choice, Jost says. But Corlette, of Georgetown's Health Policy Institute, says it’s a question that remains to be answered, especially in states with few insurers.
Corlette predicts renewed focus on whether insurance coverage is working as intended or as expected. “Insurance is supposed to provide financial security and peace of mind. Are these new plans providing that?” she asks. “And, people who haven't had insurance before may get a surprise hit from things like deductibles, in-network vs. out-of-network, pre-authorization, coinsurance and co-payments.”
Democrats and the administration can be expected to emphasize disparities in coverage. Only about half the states elected to expand Medicaid to people who won’t be able to afford to buy health insurance. Because the ACA assumed all the states would expand Medicaid, millions of poor in states such as Texas and Florida will be left with no coverage.
“The challenge will be filtering through what is pure election politics, what actually is a temporary start-up problem and what is a real policy flaw,” says Holtz-Eakin. “It’s going to be an interesting year. It is not going to be smooth.”
Aaron, of the Brookings Institution, says there are a lot of what-ifs, including how many people will enroll and how sick they are. All this will affect whether insurance companies make or lose money — and whether they hike premiums for 2015. “Everything is fixable, given time. The question is whether the politics of the situation give the administration the time they it need to fix this.”
If the system gets into working order, “It could become a positive for Democrats, an emblem of how limited government involvement in social areas can improve the lives of the American people.”
If things are rocky, on the other hand, the issue could "cast a very long, dark shadow over Democratic prospects in 2016,” he said.
“I think many Democrats assume that Social Security and Medicare and Medicaid as we know them are so entrenched in American life that they are untouchable. But Republicans have a plan to transform them.”
Does Aaron think the administration can fix the flaws in time for the election and turn around public opinion?
“As a betting person," he said, "I think the right has the better prospects right now."