The Affordable Care Act was signed into law in March 2010, but it's been the true law of the land since Jan. 1, 2014 when it officially went into effect.
The ACA, better known as Obamacare, is a complete reboot for the U.S. healthcare system. For insurers it's meant an influx of Medicaid patients, but also the inability to pick and choose who they offer insurance to. Additionally, insurers are required to spend at least 80% of collected premiums on medical care for their patients. For consumers, it's meant easier-to-understand health plan options, but it's also required them, vis-à-vis the individual mandate, to purchase health insurance or face a penalty come tax time. It's even a marked change for primary care physicians, who could see a shift in the type of care they give as people who've never had access to health insurance suddenly do.
The Supreme Court comes to Obamacare's defense
Not surprisingly, such a dramatic shift in healthcare policy has raised quite the barrier between proponents and opponents of Obamacare. There have been countless challenges proposed by the opposition in an effort to repeal Obamacare, with two making it all the way to the Supreme Court.
In June 2012, the Supreme Court of the United States, or SCOTUS, ruled that Congress was within its right to impose a tax penalty on consumers who didn't purchase health insurance. This challenge on the legality of the individual mandate was the first real scare for Obamacare supporters.
The more recent case, however, looked as if it had all the ingredients necessary to unravel Obamacare from the core. Known as King v. Burwell, the plaintiffs challenged the language of the law itself, that Advanced Premium Tax Credits (aka, subsidies) could only be paid to exchanges "established by the State." In other words, the plaintiffs argued that because the federal government was running Healthcare.gov on behalf of nearly three-dozen states, and it was divvying out subsidies to more than six million enrollees via Healthcare.gov, that these payments were in violation of the law as it's written, since the federal government isn't a "State."
Once again SCOTUS saved Obamacare, ruling 6-3 in favor of the defense. As Chief Justice John Robert wrote in the 47-page decision released by SCOTUS,
"Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them. If at all possible, we must interpret the act in a way that is consistent with the former, and avoids the latter."
The real surprise behind the latest SCOTUS decision
However, the actual King v. Burwell decision by SCOTUS may not be the biggest surprise.
Following the release of the decision from SCOTUS on King v. Burwell, the Kaiser Family Foundation posed the following question via telephone to 1,202 adults:
The Supreme Court recently decided to keep the healthcare law as it is so that low and moderate income people in all states can be eligible for financial help from the government to buy health insurance, regardless of the type of marketplace set up in their state. Do you approve or disapprove of the Court's decision in this case?
Shortly after the individual mandate ruling from SCOTUS in the summer of 2012 just 47% approved of the court's decision, while 43% disapproved. It was an expected bifurcation of opinion regarding a very controversial law. However, responses to the King v. Burwell decision were remarkably supportive of Obamacare this time around.
According to KFF, 62% of American said they approved of SCOTUS' decision compared to just 32% that disapproved of the ruling. More than nine in 10 people who had a favorable view of the ACA heading into the ruling were in favor of SCOTUS' decision, while 30% of those who had an unfavorable view actually approved of the decision.
Overall, public opinion of the ACA also continues to improve. In the late June poll, 43% of respondents had a favorable view of the law compared to 40% with an unfavorable view. The 43% favorable rating ties that of April, and is essentially a high-water mark since late 2012.
Is public opinion really shifting?
The responses to KFFs survey question and its monthly health tracking poll data on the ACA's favorability could lead some to believe that the negative opinions surrounding Obamacare may finally be shifting.
On one hand this very well could be a reality. The Commonwealth Fund's survey in May showed that an overwhelming majority of people directly affected by Obamacare seem to be happy. A whopping 86% of respondents who've purchase health insurance through Obamacare affirmed that they were either "very satisfied" or "somewhat satisfied." Furthermore, more than 90% of those people enrolled through Obamacare were satisfied with their choice of primary care physicians.
With Obamacare in place for more than 18 months now it's also possible that previously undecided consumers, or those who were modestly against the ACA in prior polls, have become desensitized to the law. With the exception of a mountain of software glitches between Oct. 2013 and Dec. 2013 that hindered enrollment, Obamacare has generally performed as expected. Premium prices have been rising at a modest pace and the uninsured rate, per Gallup, is below 12%. The law is also on pace to cost around $550 billion less over its first 10 years than the Congressional Budget Office's initial cost projection in 2012. Most importantly, millions who had no access to healthcare previously now do have that access, and it would appear that the public is generally happy with this last point.
Improved sentiment toward Obamacare could lead to more enrollees for insurers. More importantly, it could lead healthier young adults to take the plunge and purchase health insurance. Young adults are the most coveted piece of the puzzle to making Obamacare a success over the long run, but they're also the toughest group to convince to sign up since they're the least likely to go to the doctor.
Then again, this survey might just be an anomaly.
For instance, a whopping 78% of the 1,202 respondents in KFF's study also believe that we haven't seen the last major legal challenge to Obamacare. Also, about half (51%) think it's important to "continue the debate," while another 44% are essentially sick and tired of discussing Obamacare and simply think we should move on.
Additionally, 61% of those surveyed admitted only hearing a little (30%) or nothing at all (31%) about the lawsuit prior to SCOTUS' ruling. In effect, you have to wonder just how informed some of the respondents really were in the KFF survey.
Significant challenges await
The reality for Obamacare is that regardless of whether sentiment is shifting or not, it'll still face a number of hurdles in the coming years.
For example, a growing focus on personalized medicine and targeted therapies could threaten to dramatically boost premium prices and healthcare costs. Obamacare's longer-term goal is to control medical cost inflation through transparent marketplace pricing, increased insurer competition, and easier access to medical care that can hopefully lead to primary care physicians spotting costly chronic problems early. However, drug developers are creating specialized therapies that regularly price out at five- and six-figure costs per year. If drug developers are able to get their way with pricing, Obamacare is probably going to have a minimal effect in controlling medical cost inflation.
The Medicaid Gap is another major issue. Although the federal government offered funds to all 50 states in order to help them expand their Medicaid programs to cover individuals making up to 138% of the federal poverty level, 21 states have thus far chosen not to do so. Their reasoning lies with the belief that the long-term costs of expanding Medicaid are too great since the federal government, beginning in 2016, will slowly begin tapering its assistance, putting more onus on the states to raise additional revenue to cover low-income Medicaid-based patients. The millions of people in these 21 states that make more than 100% of the federal poverty level but less than 138% are stuck in limbo -- they don't get access to Medicaid or subsidies on the marketplace exchanges.
Though 44% of respondents would just prefer we move on, it would appear the majority is going to get their wish -- there's still plenty left to be decided when it comes to Obamacare.
Sean Williams has no material interest in any companies mentioned in this article. You can follow him on CAPS under the screen name TMFUltraLong, track every pick he makes under the screen name TrackUltraLong, and check him out on Twitter, where he goes by the handle @TMFUltraLong.
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