The Affordable Care Act saves lives, jobs, and money

The Affordable Care Act, also known as Obamacare, is the law of the land.  It was passed by the House and Senate and signed into law by the President after his election on a platform that included enacting the ACA.   It was later ruled constitutional by a conservative-leaning Supreme Court.

There are many problems with the American healthcare system that the Affordable Care Act attempts to address, among them the vast numbers of uninsured Americans, the heavy cost burden of caring for the uninsured, and the skyrocketing healthcare costs and insurance rates.

Before the ACA insurance exchanges went into effect, there were 48 million Americans without health insurance.  This is roughly the same number as in a 2005 report by Families USA which found that the uninsured paid only one third of the total cost for their care, leaving approximately $43 billion in unpaid expenses.  Two thirds of these unpaid costs were passed on to the insured through increased premiums and the remaining one third was paid for by taxpayers through various government programs and local tax increases.

To get an idea how much caring for the uninsured costs the average family, consider what Kurt Eichenwald from Vanity Fair writes:

“On average nationwide, uncompensated care resulting in higher medical costs added $1,502 to premiums for families relying on employer-provided policies—from a total amount that had gone unpaid in excess of $60 billion. And once again it is the citizens of states most opposed to Obamacare who are refusing expansions of Medicaid who are taking the biggest shellacking: Texas residents are paying $2,786 more in premiums for family policies provided through employers. Montana, $2,190. Alaska, $2,248. Idaho, $2,152. North Carolina, $1,828. The other states I mention also take big hits—New Mexico, West Virginia, and Oklahoma residents are all paying about $3,000 more for premiums on employee-provided policies.”

With skyrocketing medical costs and so many uninsured Americans, it may come as no surprise that medical bills are the primary reason for bankruptcies in the US.  A 2007 Harvard University Study found that 62.1% of all bankruptcies had a medical cause, and of those cases, over 75% had medical insurance when they got sick.  It is estimated by Nerdwallet Health that 1.7 million households will file bankruptcy protection because of medical bills they cannot pay, this year.   Nerdwallet also predicts that 56 million adults will have difficulty paying their medical bills, including nearly 10 million adults with medical insurance.

The ACA will allow millions of Americans to purchase medical insurance at reduced costs, far lower than expected, through marketplaces that spur competitive pricing of insurance premiums.  The ACA also allows low-income Americans to qualify for insurance through Medicaid expansion, but only in states willing to allow the Medicaid expansion.  This generates revenue for hospitals that normally treat the uninsured, as well as reducing federal spending for hospitals that treat a high volume of uninsured patients.

A recent Washington Post article explains that federal payments made to these “safety-net” hospitals, which come from the Medicaid and Medicare programs, will fall by more than $30 billion over the next decade.  They go on to explain that the need for any federal spending could be eliminated if Republican governors would allow the Medicaid expansions in their states: “Health experts initially thought that those funds would become unnecessary as the expanded access to health coverage lessened demand for uncompensated care. After the Supreme Court declared the Medicaid expansion optional, several Republican governors declined to move forward, leaving hospitals worried that they will still see high numbers of uninsured patients.”

Until all 50 states allow the Medicaid expansion, or enact a version of their own design, hospitals, taxpayers, and the insured will continue to have to bear some of the cost burden of treating those without coverage.

In addition to declining Medicaid expansion, many predominantly Republican states have opted to allow the federal government to set up and control their insurance exchanges, rather than control the process at the state level.  Sahil Kapu explains why in this Talking Points Memo article:

“When the ACA created this structure, it seemed like a no-brainer that states would be on board. Why would any of them, especially the ones hostile to the law, willingly give up control of their health care systems to Washington?  Ironically the answer, by and large, is politics. Conservatives activists detest “Obamacare” and argue that any governor who agrees to build an exchange is abetting the law, even though the consequence of not doing to is to surrender more control to Washington…”

On October 1st, open enrollment in insurance exchanges began, allowing consumers to shop for private insurance plans and access federal subsidies.  These insurance plans will go into effect on January 1st, and enrollees have until December 15th to complete the process.

At, the federal site which serves 36 states, the first day of enrollment saw such a high volume of visitors that it overwhelmed the site’s servers, prompting administrators to add capacity to get the site back in service.  According to, individual state exchange officials reported similar demand:

“In New York, officials said their exchange had 2.5 million visitors in its first half hour yesterday. California reported as many as 16,000 hits a second. And U.S. officials recorded 2.8 million visitors to the federal website,, even as it fought technical problems much of the day.”

Opponents of the Affordable Care Act point to the technical problems with the websites as proof that the exchanges were not prepared for business.  For supporters of the ACA, help for the 48 million uninsured Americans cannot come soon enough.