Welcome to the Obamacare era.
The healthy are subsidizing the sick. Insurance companies are tightening access to doctors. Plans with low premiums have high deductibles. Sometimes it rains, Nickelback is still a band, and people continue to die literally every day.
But just because something is happening and Obamacare exists doesn't mean it's happening because Obamacare exists—even in health care.
Don't tell that to the law's critics: The Affordable Care Act has become the go-to scapegoat for just about everything people don't like about health care, if not in the economy overall. The law is being blamed for trends, economic incentives, and basic realities that it did not create and that were part of the health care system long before President Obama was even elected.
There's not a big difference between "how Obamacare works" and "how health insurance works"—and that, health experts said, is what makes the law such a convenient target.
Under Obamacare, if you like your doctor, you can't always keep her.
Consider the complaint du jour about the Affordable Care Act: You might not be able to keep your doctor. There's some truth to this charge, because many plans sold through the law's insurance exchanges have set relatively narrow networks of doctors and other providers. There's no question that narrow networks are common in Obamacare exchange plans—but they were common before, too.
"Narrow networks were happening already. There has been kind of a resurgent interest in narrow networks," Kaiser Family Foundation President Drew Altman said.
Narrow networks are one of the tools insurers use to keep premiums low. Doctors want to be paid as much as possible, while insurers want to keep their costs down so they can charge a lower premium and attract more healthy customers. To get there, insurers will sometimes exclude expensive providers, unless those doctors are so popular that people are willing to pay more for a plan that includes them.
"Where you have had a choice, people have made trade-offs," said Sabrina Corlette, a senior research fellow at the Georgetown University Health Policy Institute.
By creating new marketplaces where millions of people are suddenly shopping for insurance—and by cutting off other levers insurers could use in the past (like refusing to cover sick people)—Obamacare has "accelerated" the shift to narrower networks, Altman said. But he said the pendulum already seemed to be swinging in that direction.
Insurers tried to narrow their provider networks in the '90s using HMOs, and consumers hated the plans so much that insurers ultimately backed away. That could happen again this time—the Affordable Care Act doesn't require narrow networks and it doesn't dictate how much insurers pay doctors.
"No one has ever heard of an HMO? Networks have been around forever," said Aaron Carroll, director of the Center for Health Policy and Professionalism Research at Indiana University. "The idea of networks as somehow new or government-created is strange.... I understand why people don't like it. They never have. But it's not the fault of the Affordable Care Act. It's the fault of trying to keep spending to a minimum."
Under Obamacare, deductibles are rising.
A similar dynamic is playing out with Obamacare's next big scare: rising deductibles. Republicans have trumpeted reports about high deductibles to argue that the plans aren't actually affordable. And many plans sold through the exchanges do have high deductibles—often right up to the maximum allowed by law.
But deductibles were already on the rise, pre-Obamacare. In the market for employer coverage, which Obamacare barely touches, deductibles have been growing steadily. In 2006, according to the Kaiser Family Foundation, 10 percent of workers covered by an employer plan had an annual deductible of $1,000 or more. By 2010, the year the Affordable Care Act passed, it was up to 27 percent. By last year it had reached 38 percent.
Shifting costs to individuals is another tool to keep costs and premiums low, and another area where the law has "accelerated" an existing trend but not caused it, Altman said.
The Affordable Care Act will result in a surge in the number of people with high-deductible plans, as well as in the number of plans with narrow networks—because that's where the market has pushed private insurance, and cheap plans in particular.
And, for what it's worth, high-deductible plans have long been a tenet of conservatives' health care plans. They've called for more "skin in the game," meaning more out-of-pocket spending and looser benefit mandates.
"While conservatives feel they've been losing big-time with Obamacare and they don't like it at all, the plans in the exchanges represent just the kind of skin-in-the-game system that conservatives have always supported," Altman said.
Employers are cutting benefits.
Employer plans aren't subject to some of the law's most expensive requirements—they don't have to cover "essential" benefits, for example, partially because most of them already do. But that hasn't stopped private-sector employers from citing the health care law when they have cut health benefits. UPS, for example, said the law was part of the reason it would not offer its health plan to employees' spouses who had their own offer of employer-based coverage.
Health care experts aren't so sure the law is responsible.
On average, employers' health care costs are growing at near-record lows—about 4 percent per year, according to Kaiser's annual survey of employer plans. That's partially because health care costs have slowed overall, but also because employers have gradually taken steps like UPS'—shifting more costs to employees, adding or increasing deductibles, and scaling back benefits.
"I think in the broader employer market we're seeing a lot of things that were happening anyway being blamed on the law because it's a convenient scapegoat for changes they wanted to make anyway," Altman said.
Obamacare makes healthy people subsidize sick ones.
"Particularly harmed are young people trying to climb the economic ladder.... Obamacare depends on young, healthy people being forced to pay higher premiums in order to subsidize the premiums of older, less healthy people," Sen. Ted Cruz, R-Texas, said in a recent op-ed.
Every private health care plan depends on healthy people subsidizing unhealthy people. Safe drivers subsidize bad drivers, homes that don't burn down subsidize those that do, and people who don't file health care claims subsidize those who file a lot of them.
"That is every risk pool in the world—that's how health insurance works," Carroll said.
The law only allows insurance companies to charge older consumers three times more because of their age, while some states allowed them to charge five times more. So the subsidy from young to old might be a little bigger, but it's not new.
So, what does Obamacare do?
For the most part, Obamacare has simply turned up the volume on existing market forces. But there are still plenty of concrete trade-offs that did really start with the Affordable Care Act.
It truly did force insurance companies to cancel millions of health care plans, for example. As much as the White House tried to paint that as insurers' business decision, the law creates new standards for insurance plans and makes a concerted effort to push people into those plans. Whether those standards are a good or bad thing for consumers is a matter of opinion, but there's no question the Affordable Care Act made it impossible for millions of people to stay on the plans they had.
That might have been a smaller political problem if Obama hadn't promised that people could keep their plans. And even with trends the law didn't cause, his sales pitches could still come back to bite him. Obama also promised that you could keep your doctor—something he couldn't guarantee with or without Obamacare.
The Affordable Care Act makes a complicated series of trade-offs to make health care more accessible, and some people will get a worse deal as a result. But many trade-offs that seem like Obamacare are really just the health care system.
"Obamacare gets the blame for much of the bad stuff happening anyway in the health care system, and also little of the credit for the good things it's doing," Altman said.
The 12 Days of Obamacare
This article appears in the December 13, 2013 edition of NJ Daily.