Context for Coverage…

President Obama defended the Affordable Care Act today, and suggested many of his critics are “grossly misleading” in talking about cancellations of policies without any of the new benefits, options, and protections in place that will help people get better care.

Some have argued that there are many more “winners” than “losers”–which is true, but I would make the case that everyone benefits, just not initially.

Most people with employer-based coverage or Medicare and Medicaid won’t see any changes—those improvements have already been made over the last 3 years. (If anything, it will now be easier to get on and stay on Medi-Cal, and there will be new incentives to get employers to continue to provide coverage to their workers.)

As the President said, the ACA does not force plans than existed at the time of the law’s passage to end. Those plans in 2010 were “grandfathered,” allowed to be continued regardless if they met Obamacare standards. Insurers kept selling substandard policies, however. And the law does not prohibit insurers from terminating plans–like they have done for years, cancelling plans and shifting people to plans with higher premiums or cost-sharing. The difference is that this year, the plans can point to the ACA for the change (with some justification), and that the ACA provides new options so that the changes are likely to be positive rather than negative.

In the individual market, most will see their premiums go down (both because the Exchange has negotiated for the group rate, and because of income-based subsidies so individuals don’t have to pay more than a certain percentage of their income for coverage).

Some of the increases that some see are in line with what people have seen every year for as long as I have been in this work. And yes, there are some (a small percentage but who number hundreds of thousands of people), who may initially see premium increases—but even in those instances, they are getting a plan of better value—one with stronger benefits and consumer protections. If we are going to require “coverage,” and subsidize “coverage,” we needed to define “coverage” in a meaningful way, and not allow “junk” insurance that leaves people with tens or hundreds of thousands of dollars in medical bills.

These folks are generally young, healthy and wealthy (at least those who have higher incomes but don’t have employer coverage), but they will benefit if (or more likely when) they lose one or more of those blessings.

We should also be vigilant that some of these rates are the result of insurers conveniently blaming the ACA for increases that would have happened anyway, or even where they found the opportunity.

Kaiser Health News has a helpful Q&A, and the President has his own advice: folks should make sure to shop around. What the insurer sells you may not be the best option: you could choose among Platinum, Gold, Silver or Bronze policies to balance a high or lower premium with higher or lower cost-sharing. You can also shop between health plans, which many couldn’t do in the previous market, because of pre-existing conditions and the lack of apples-to-apples comparisons that begin now.

Finally, there’s no question that there is more work to do. Before and since the passage of the Affordable Care Act, health costs were rising. The ACA provides significant relief to many, but not all, and it provides a start to reigning in health costs, but we can do more. The ACA instituted rate review, saving over $300 million for California consumers, but the state can do more with full rate regulation. The ACA puts in place new reforms to have greater price transparency and to control costs, and there’s more state policymakers can do to build on these efforts.