Rick Bowmer/AP Photo
People protest a Republican bill in the U.S. Senate to replace Obamacare, in Salt Lake City, June 2017. The expansion of Medicaid under President Obama’s signature health care legislation has proven to be an extremely effective and popular provision.
Wednesday’s debate was mercifully light on the subject of health care, which has exhausted a tremendous percentage of the questioning period in the four preceding events. And while the now-customary raking over the coals of Medicare for All was largely avoided, moderator Kristen Welker still raised the familiar argument that the Democratic establishment has settled on to chill M4A enthusiasm. “Senator Warren, you are running on Medicare for all,” Welker said. “Democrats have been winning elections even in red states with a very different message on health care: protecting Obamacare.”
Shortly thereafter, Joe Biden gave Welker the answer she had fished for, an enthusiastic pledge to build on Obamacare. “We should build on Obamacare, provide the plan I put forward before anybody in here,” he declared.
For the vast majority of the field, especially for those moderates who are no longer or never were backing Medicare for All, that position has become the default. They pledge to continue on the path cut by Obamacare, the signature policy achievement of the Obama administration, while steering clear of levying any criticisms of the policy.
But there’s a lack of clarity about both what building on Obamacare entails and what the legacy of Obamacare has been. Nearly ten years since its passage, the foundation of Obamacare that Democrats could build on has not been its tweaks to the private insurance market, its buy-ins, or its emphasis on consumer choice. It’s been the surprising expansion of publicly provided health coverage via Medicaid.
The Affordable Care Act was essentially a two-part proposal. There was a private-sector component, which set up exchanges on which people could buy into the private insurance market as individuals, and there was a public-sector component in which states would expand Medicaid, the insurance program for the poor, which would be extended to people earning up to 138 percent of the federal poverty level, or $16,400 for a single adult.
The exchanges were the flagship feature of the ACA and grabbed most of the attention. President Obama famously took to Zach Galifianakis’s talk show Between Two Ferns to advocate for their rollout and encourage participation. But after that early media frenzy, the individual insurance markets quickly went sideways. By 2017, one-third of counties in the United States had only one insurer to choose from on their state’s Obamacare exchange. Insurance companies, not legally compelled to participate, fled the market in droves. By 2018, Aetna, the country’s third-largest insurer, had withdrawn from ACA exchanges in every single state. In 2017, Medica, the last insurer remaining in most of Iowa, pledged to stop selling individual plans. In Tennessee, Blue Cross Blue Shield, the state’s largest insurer, withdrew in 2016, only returning once Humana announced it was pulling out a year later, leaving 40,000 people uninsured.
This has stabilized somewhat; premiums will actually drop slightly in 2020, and the number of participating insurers will increase, a slight reversal of a multiyear trend that was once thought of as a “death spiral.” Still, according to a Kaiser Family Foundation analysis, 52 percent of counties had access to just one insurance company in the marketplace in 2018. Meanwhile, with no real attempts to take on pricing, costs and premiums have continued to surge and high-deductible plans have proliferated, while insurers have salted away record profits, year upon year. It was this colossal failure by the private market to make good on the promises of the ACA that gave Trump the ammunition to pursue an eventually thwarted rollback of the bill in its entirety.
The expansion of Medicaid, on the other hand, was far less ballyhooed at the outset. It didn’t get talk show treatment, or celebrity endorsements. And it was dealt a nearly terminal blow in its infancy; the Supreme Court’s ruling in NFIB v. Sebelius made Medicaid expansion optional, with 19 states rejecting the expansion right away.
But despite that inauspicious debut, Medicaid expansion has actually proven to be extremely effective and popular. Even with the voluntary opt-in clause, 37 states plus D.C. have now joined the Medicaid expansion. An astonishing 13.6 million people have gained health insurance as a result, the effects of which were evinced almost immediately. One study found that by the fourth year of Medicaid expansion, mortality rates in expansion states were 0.2 percentage points lower than in states that did not join.
Compare that to the individual marketplace, where enrollment was weak from the outset, and continues to contract. In 2019, first-quarter enrollment dropped by 5 percent compared to the first quarter of 2018, which was actually an improvement compared to losses stacked in previous years. 2018 saw enrollment drop 11 percent from the year prior, while 2017 sported a 12 percent decrease, owing to steep premium increases. According to the Kaiser Family Foundation, roughly 10.6 million people held individual insurance before the time of the ACA exchange’s enaction. By 2019, that number had only climbed to 13.7 million. Some of that is due to the durability of employer-sponsored coverage in a relatively strong economy, but the larger point is clear: The Medicaid expansion has covered far more of the uninsured than anything in Obamacare.
Not only has Medicaid expansion been good policy, it’s been good politics, as well. The overwhelming popularity of expanding Medicaid has helped Democrats secure unlikely victories in red states just in 2019 alone. In Kentucky, Democrat Andy Beshear was able to win the governor’s mansion on the back of a Medicaid expansion his father enacted when he was governor. Meanwhile, Democrat John Bel Edwards, who ushered in Medicaid expansion during his first term, was able to pull off re-election in Louisiana despite enthusiastic campaigning against him by President Trump. The contested Medicaid expansion was a driving force in the recent political overhaul of the state legislature in Virginia, which now features Democratic control of both chambers for the first time in decades.
It’s not just anecdotal: 77 percent of Americans are in favor of Medicaid expansion—including 77 percent of independents and 55 percent of Republicans. That’s allowed states, at least in some part, to repel mounting incursions in the form of Medicaid work requirements, which have proven politically noxious even for Republicans in Republican-dominated states.
So as enrollment in the exchanges continues to tumble, and Medicaid expansion continues, the true legacy of Obamacare is its expansion of government-provided health care, not the protection of employer-provided private insurance plans or the extension of the mythical consumer “choice” in coverage. The flagship success of Obamacare has been the expansion of the pre-existing public provider. That accomplishment may not be deserving of its own portmanteau, but if the ACA is worth championing, it’s the overwhelming reason why.
That means that plans most loyal to the legacy of Obamacare aren’t actually Obamacare’s most ardent, vocal defenders. They’re the ambitiously expansive proposals of Bernie Sanders and Elizabeth Warren, who want to see the publicly provisioned health sector expanded drastically. To this point, that’s been the real legacy of Obamacare, even if its advocates have refused to acknowledge it in their messaging.
The approach being put forward by Biden and Pete Buttigieg, by contrast, pledges to tweak the Affordable Care Act with the addition of a public option, while leaving the private insurance market intact. But given the price tag those candidates have identified as the cost of such a proposal, it’s clear that neither of them anticipates that option will be a major draw. In many ways, their vision of “building on Obamacare”—a euphemism for playing nice with insurance companies while rooting out some marginal way to increase coverage—sells the program short.
As health care continues to be front and center in the Democratic primary, the jockeying for the position of torchbearer of the Obama legacy, and his signature legislative accomplishment, is sure to wear on as well. But anyone advocating for choice, for the market, or for private insurance is doing him, and the ACA, a disservice.
