Few provisions in Obamacare are more hated by Americans than the individual mandate requiring people to buy government-approved insurance or pay a fine.
And as Republicans look to revamp the healthcare system, experts disagree about the extent to which the provision did what it was intended to do: Get more people to purchase health insurance who otherwise wouldn't.
The divisions on the issue were apparent in a recent report published by the office of the actuaries at the Centers for Medicare and Medicaid Services. The report projected that the American Health Care Act, the House-passed bill to repeal and replace portions of Obamacare, would result in 4 million more people choosing to be uninsured because the mandate would be repealed. The results differed sharply from an earlier report from the Congressional Budget Office, which projected that 14 million people would make that choice when given the option, either because they didn't want insurance or because of higher premiums that could result from repealing the mandate.
"I think this is one of the places where researchers disagree," said Douglas Holtz-Eakin, a former CBO director who is now president of the conservative American Action Forum, and said he doesn't view the mandate as being incredibly effective.
Chris Sloan, senior manager of policy practice at Avalere Health, said he believes the strength of the individual mandate may be overstated in the CBO report as an impetus for people purchasing coverage.
"The CBO has aggressive individual mandate assumption in their model," he said. "When they take it out, a lot of people drop out ... I think in this case I would disagree that the mandate is as big of a driver as they think."
CBO acknowledges the uncertainty surrounding its estimates, noting that individuals make decisions about health insurance within the context of weighing other factors such as the cost of premiums, how much they receive in subsidies and what the penalties are. Under Obamacare, the penalty for not having health insurance is $695 for an individual, or 2.5 percent of income, whichever is higher. By comparison, a recent Department of Health and Human Services report found that unsubsidized premiums on the exchange averaged $5,712 a year in 2017.
The numbers from the CBO report have provided some political fodder for Republicans who have said said that Americans don't value their Obamacare plans and therefore want to drop them. Republicans, in criticizing the healthcare law, also point out that CBO was wrong in its projections about how many people would sign up for coverage under the exchanges, overshooting by roughly twice the actual enrollment numbers. CBO acknowledged that discrepancy in its first evaluation of the American Health Care Act.
Despite the problems with the individual mandate, hints from senators, as well as provisions in the House bill, suggest that Republicans are examining ways for the popular provisions in Obamacare, such as guaranteed coverage for people with pre-existing illnesses, to be handled so that risk pools have a balance of healthy and sick enrollees. Economists have referred to Obamacare's individual mandate, its tax subsidies and its protections for people with pre-existing illnesses as a "three-legged stool" to keep the system balanced.
"You ideally would like to design something that keeps people in the market and incentivizes them to stay, and something that prevents gaming the system," Sloan said.
But as Obamacare has played out, the stool appears to be unbalanced. Claiming millions of dollars in losses and sicker-than-expected enrollees, insurers are leaving the exchanges, a move that has been propelled by uncertainty from the Trump administration. Still, in citing their reasons for leaving or for asking for rate hikes, insurers have said they do not have a guarantee on whether the federal government will enforce the individual mandate, suggesting that companies place some trust in its effectiveness.
In place of the individual mandate, the American Health Care Act contains a provision known as "continuous coverage," which would place surcharges on customers' premiums for 12 months if they are uninsured for more than 63 days. Another proposal that has been raised by more centrist Republicans would create an auto-enrollment provision that signs people up for catastrophic coverage that is paid for through a government tax credit.
The continuous coverage proposal has some industry support. Marilyn Tavenner, the president and CEO of America's Health Insurance Plans, which represents insurers, stressed the need for continuous coverage in a healthcare reform bill.
"We need effective incentives to encourage consumers to get and keep insurance so coverage can be affordable for everyone," Tavenner said at a Senate hearing in February. Neither the group nor other insurers have publicly stated their position on auto-enrollment, and it's not known what incentive or penalty the Senate bill will have.
Experts say the enforcement of Obamacare's individual mandate could have been stronger.
"They exempted a lot of people and had a lot of special enrollment periods, and the penalty wasn't very large," Holtz-Eakin said.
Jonathan Gruber, an MIT economist who helped write Obamacare, said he believes that Republican undermining of the law caused the mandate not to work as well as it otherwise would have.
"People are less willing to abide by a law people see as less legitimate," he said, noting that congressional Republicans voted to repeal the healthcare law dozens of times when former President Barack Obama was in office. "The Affordable Care Act never really got a fair chance."
He also believes, however, that if the penalty were higher, more people would sign up for coverage. An article he co-authored in the New England Journal of Medicine concluded that response to the individual mandate may grow over time, but that overall coverage rates were less affected by the individual mandate than by other aspects of Obamacare.
"It didn't have the effect we thought, but it's still meaningful in terms of enforcement," Gruber told the Washington Examiner.
Another option to reduce premiums is to increase financial contributions to insurers by the federal government, Gruber said, noting that the approach was not cost-effective. The American Health Care Act provides more than $100 billion for high-risk pools, which Gruber said could help subsidize insurers. Republicans have decried increases to federal spending, but some short-term fixes to state exchanges have involved requests for millions of federal dollars for reinsurance."In a perfect world we would strengthen the mandate, but in the real world we should throw that money at insurers," Gruber said.
NOTE: This story has been updated to specify the assumptions CBO made in coming up with its estimate that under the House-passed bill, roughly 14 million more people would be uninsured due to the elimination of mandate penalties.