Obamacare Is Being Repealed by Consumers, Providers and Insurers

Obamacare Is Being Repealed by Consumers, Providers and Insurers

REUTERS/Jonathan Ernst

The 2016 election cycle will come to a close on Tuesday, and its conclusion will probably have little significance on the issues that face the nation. The three months in which Republicans and Democrats (and others) fought for the presidency focused almost entirely on personalities and personal qualities rather than substantive policy. 

Republicans want people to vote to keep Hillary Clinton and vast corruption out of the White House, while Democrats argue that voters have to block a temperamentally unsuited and unprepared Donald Trump from having his finger on the nuclear button. Independent candidates Gary Johnson and Jill Stein want voters to protest against the two-party system by supporting their campaigns. 

Related: Here’s How Much Obamacare Premiums Are Rising in All 50 States 

That will be America’s misfortune because we do face serious choices in the next four years – and this election will tell us nothing about the direction voters want about any of them. The stakes of this election cycle will only determine which candidate turned out to be least unfavorable on personal qualities. 

On issues such as the war on ISIS, the economy, and national debt, both major-party nominees offered nothing but vague ambiguities while focusing almost all of their time and attention on each other’s peccadilloes. No matter the result, the winner will have no claim on a mandate from the electorate on almost any policy direction.

Rather than look to the election results for policy direction on one key issue, perhaps the next president should look to the voters themselves. When it comes to the Affordable Care Act, nearly every stakeholder involved has voted with their feet. Consumers, providers, and even the insurers who helped create Obamacare to profit from a government mandate have all begun to flee from it.

Late last week, earnings reports from major health insurers Aetna and UnitedHealth showed a greater-than-expected decline in enrollments from an already disappointing 2016 result. Jed Graham reported at Investors Business Daily  that over 113,000 enrollees had stopped paying their premiums in the third quarter, a 6.6 percent drop that left a combined enrollment of 1.6 million consumers. The two companies account for a sixth of all ACA exchange enrollees, and the trend indicates that national Obamacare enrollment has dropped below 10 million – again.

Related: The Simple Reason So Many Americans Are Opting Out of Obamacare 

“On top of that,” Graham reminds readers, “the fourth quarter appears headed toward big enrollment declines as it has in the past, as people take advantage of the law's 90-day grace period that leaves insurers on the hook even after customers stop paying their premiums.” Last year’s fourth quarter decline was over a half-million people or 5.7 percent. If that repeats, then total enrollment could drop to 9.25 million – well below the worst-case projection from Health and Human Services of 9.4 million. 

That will only get worse in 2017 as premiums rise an average of 25 percent -- and have more than doubled in Arizona. The incentives of those price increases will push even more consumers out of the exchanges, creating more risk-pool distortion, but it’s not just the price increases that will have consumers in Arizona and elsewhere voting with their feet. One-third of all counties in the US will have only one insurer to select in the exchanges, according to the Associated Press

In eight states -- Arizona among them – a majority of counties will only have one insurer. The take-it-or-leave-it choice will have more consumers leaning toward the latter option as well, especially those who do not expect to incur enough medical expenses to surpass soaring deductibles. 

That impediment has caused an even more perverse incentive. Even those who do stay within the system have curtailed their utilization of health care. A GFK poll reported by The Free Beacon shows that half of all ACA exchange consumers have skipped doctor visits in order to save cash, and 36 percent did so even when sick. Only a third of those with employer-based insurance have cut back on utilization. So much for Obamacare bringing “health care” to the masses. 

Related: As Obamacare Premiums Soar, Employers Raise Deductibles to Keep Costs Down 

Even those who do seek care face fewer and fewer choices as a result of two different trends. Providers have cut back access for Obamacare consumers as the reimbursement rates and compliance requirements make it too costly to accept ACA exchange patients. 

For instance, Chicago hospitals and doctors announced last week that they would drop out of all Cook County Obamacare plans, leaving city residents on the exchanges with nowhere in-network to go with their insurance coverage. Separately, insurers have continued to narrow in-network provider options, which they explain as cost-cutting measures but leave some consumers with no convenient access to care. 

Finally, the insurers themselves have voted with their feet, too. Minnesota had to agree to ration access to health insurance in order to keep insurers from completely abandoning the state in 2017. UnitedHealth, Aetna, and Humana have all separately announced limited or total pullbacks from the Obamacare exchanges over the last few months.

Earlier this week, Anthem warned that 2017 might be its last year in many ACA markets if trends continued. “If we do not see clear evidence of an improving environment and a path towards sustainability in the marketplace,” CEO Joseph Swedish announced on an earnings call, “We will likely modify our strategy in 2018.” 

Even if next week’s election provides no mandate on policy for the next four years, the exodus of all stakeholders from Obamacare sends a very clear mandate and a very clear message to Washington DC. No one has any confidence left in a failing attempt at government control over a market that bureaucrats have clearly never understood. Absent action to end this experiment in command economies, Obamacare will get repealed anyway – by consumers, providers, and insurers in a total and costly collapse.