Insurance premiums are falling and the health insurance market is more stable than before, and President Trump is the reason why, said Health and Human Services Secretary Alex Azar on Thursday.
Speaking at Lipscomb University in Nashville, Azar said, “The president who was supposedly trying to sabotage the Affordable Care Act has proven better at managing it than the president who wrote the law,” said Azar, referring to former President Barack Obama.
“We are announcing today that, for the very first time under the Affordable Care Act, the premium for a benchmark federal exchange plan is projected to actually drop. Insurers have proposed to cut premiums for these benchmark plans by 2% nationally. Meanwhile, the number of federal exchange insurers will grow for the first time since 2015,” Azar said.
“One of the first significant actions by the President elected to repeal and replace Obamacare was stepping in to help the American people by stabilizing the market as best he could, within the law’s broken confines,” Azar said.
Trump helped increase the types of plans Americans are allowed to buy — by allowing reduced-coverage policies banned under the Obama administration — and gave states more freedom to fix their markets, he said.
The president also approved state reinsurance plans which contributed to lower premiums, ended the cost-sharing reduction payments — “a lawless situation” — and supported a bipartisan stabilization bill, Azar said.
New Options, New Questions
Azar applauded the president’s efforts to expand health insurance options by increasing access to short-term heath plans, which could be extended for up to a year and potentially renewed for just short of 36 months, and to association health plans, which would allow small businesses to band together and buy health insurance together.
Short-term health plans are 50-80% cheaper than plans regulated by the ACA, he said.
While acknowledging that not all short-term plans offer the same benefits as ACA-regulated plans, “we’re not going to tolerate a system that forces anyone to pay 10 times more for insurance than they need to.”
Critics have pointed out that healthcare needs aren’t predictable and that plans that don’t comply with ACA requirements can leave buyers short of coverage when they need it.
Nevertheless, Azar said, “We know we can offer Americans real choices while fulfilling President Trump’s promise to protect the most vulnerable Americans, like those with pre-existing conditions.”
Yet despite what Azar characterized as the president’s successes, “the individual market for insurance is still broken,” he said.
Premiums are still too high for Americans who don’t receive subsidies, he noted. “The ACA is not ‘fixed’ or even ‘fixable’ without Congress’s repealing or replacing it,” Azar said.
Ridiculing ‘Medicare for All’
The Secretary went on to slam the healthcare reform idea most popular among many Democrats: “Medicare for All.”
“When we were young, our parents taught us a good lesson: If something sounds too good to be true, it probably is,” he said.
The Affordable Care Act epitomized that lesson, and remembering its “failure” is key to avoiding a similar mistake with an even broader healthcare reform, Azar said.
“When you drill down into the details, it’s clear that Medicare for All is a misnomer. What’s really being proposed is a single government system for every American that won’t resemble Medicare at all. Broadening the Medicare system would undermine the security and access seniors currently enjoy, come at a staggering cost to taxpayers, and ignore what seniors are showing they want from Medicare today.”
Azar recalled that 4.7 million Americans saw their plans canceled after the ACA was enacted, and predicted even greater disruption with Medicare for All. Currently 170 million Americans have employer-sponsored insurance, he said.
“Under some versions of Medicare for All, these [employer] plans would be outright banned, replaced with just one government option, outright, overnight,” he said.
Under some versions of Medicare for All, the “broken promise” of the ACA that “if you like your doctor you could keep your doctor” would not even be a thought, because that doctor might not agree to take a Medicare for All plan. (Azar didn’t mention that private insurance plans, with their provider networks, also restrict patients’ choice of physicians.)
Medicare’s payment rates are “significantly lower” than private insurance, he said.
“Do you think the best doctors will stay in that new system — rather than moving to just accepting cash? Will the brightest Americans go into medical school, knowing they might make 40% less than they would have otherwise?”
Today, the higher payments from commercial insurers are what keep Medicare afloat, allowing doctors to serve lower-paying Medicare patients, Azar asserted.
Finally, the secretary addressed what he called the “staggering” costs of implementing such a system.
Currently, 28% of federal spending goes to healthcare, but under a Medicare for All system, 58% of the federal budget would be spent on healthcare by 2022, he said.
The Medicare Trust Fund is forecast to run out in 8 years, he added.
“It is reckless to propose more than tripling the size of Medicare, with no clear way to pay for it, when we haven’t even agreed on responsible ways to maintain the current program our seniors rely on.”
Medicare for All would also reduce options for seniors, many of whom have bought Medicare Advantage plans — private plans for seniors that are paid for by the government.
One in three Medicare enrollees have chosen Medicare Advantage plans, he said.
“Advocates of Medicare for All are looking backward — not just by repeating the flaws of the Affordable Care Act, but also by trying to impose a payment system designed in the 1960s on all of American healthcare.
“There is a better way: sending power back to the American people — to states, to local communities, to your doctor, and to you, as American patients. Empowering the decision-makers closest to patients is both the way of the future and a return to what we love about American healthcare.”
Tomorrow: Advocates for the Affordable Care Act and Medicare for All have their say.