No one’s interested in trying to save Obamacare’s centerpiece as it faces certain death.
Even as the healthcare industry heavily lobbies Republicans to keep the Affordable Care Act’s other main components, such as its subsidies and Medicaid expansion, doctors, hospitals and insurers are stepping away from the law’s individual mandate for people to buy insurance or pay a fine.
Not even Democrats are campaigning to keep the mandate, which was once viewed as the key to making Obamacare successful. The thought was that the mandate would prompt enough healthy young people to buy coverage to keep premiums stable. But nearly everyone agrees it didn’t work as well as intended. And repealing it is top of list for Republicans.
“We’re trying to get to a solution that gets everyone covered, and the individual mandate hasn’t been as successful as everyone hoped in doing that,” said Kristine Grow, spokeswoman for America’s Health Insurance Plans.
“So we’re talking less about the mandate and more about the problems the mandate was working to solve,” Grow said.
The individual mandate took center stage in 2012, when the Supreme Court ruled it was constitutional under Congress’ power to tax. At the time, the Obama administration argued that without the mandate, the healthcare marketplaces would collapse because not enough healthy people would participate.
But four years into the marketplaces, the mandate has failed to pull in nearly as many healthy enrollees as hoped. Despite the penalty for remaining uncovered, only about 28 percent of enrollees have been younger than 34, far less than the 40 percent many actuaries say are needed to balance out greater costs for the older and sicker.
Plus, there’s a sense of inevitability in the healthcare industry that the mandate won’t survive much longer. Republicans included it in their 2016 bill repealing Obamacare, and it’s certain to be a part of whatever measure they come up with in the spring ditching big parts of the law.
So instead of lamenting the mandate’s dark future, the leading healthcare associations are urging Congress to enact other incentives for healthier people to buy coverage, such as providing for a one-time enrollment period after which people could be charged more for coverage and allowing insurers to shift costs toward older people and away from younger people.
AHIP President Marilyn Tavenner didn’t ask Congress to keep the individual mandate last week, when she testified before the Senate Health, Education, Labor and Pensions Committee.
Instead, she asked lawmakers to require that people have coverage continuously to avoid extra fees and allow insurers to charge older people five times what younger people pay instead of just three times under current law.
“We need effective incentives to encourage consumers to get and keep insurance so coverage can be affordable for everyone,” Tavenner said.
The shift is notable, as the insurance industry lobbying group had been a foremost advocate for including the individual mandate in the Affordable Care Act when it was being written in 2009. At the time, the mandate was viewed as crucial, since every state that required insurers to accept patients with pre-existing conditions also required everyone to buy coverage.
But polls have shown that the individual mandate has consistently remained one of the most unpopular parts of the healthcare law, with about 65 percent of Americans wanting it repealed. So it’s not surprising that industry leaders are looking for other tools to incentivize insurance purchases.
“The problem the mandate was supposed to solve is still there,” said Alice Rivlin, a senior fellow at the Brookings Institution and former director of the Office of Management and Budget under President Bill Clinton. “It’s just that I think people have decided let’s explore alternatives because it wasn’t popular.”
Doctors groups aren’t pushing for the mandate, either. As they lobbied Capitol Hill lawmakers on Thursday, they pushed members to maintain the healthcare law’s insurance reforms and its coverage expansions by continuing to supply lower-income Americans with subsidies.
“We would like to see a system that covers most Americans, is affordable and provides access,” said Nitin Damle, president of the American College of Physicians. “Whether that can be done without an individual mandate — we’re going without comment.”
As Republicans work on a repeal bill, which they say will include some replacements for the law as well, they are undecided on how to replace the individual mandate. But they’ll need to incentivize healthy people to buy coverage, since insurers will be required to accept everyone even if they have a serious disease such as cancer or a chronic condition like diabetes.
A plan promoted by House Speaker Paul Ryan wouldn’t mandate people to buy coverage. But after a one-time enrollment period, it would allow insurers to charge patients with pre-existing conditions higher premiums if they didn’t maintain continuous coverage.
Other tools include tightening the rules for when people can enroll in coverage and changing the so-called age rating governing how much younger people can be charged relative to older people.
“We’re thinking about it not as one solution,” Grow said. “We don’t think there’s one magic bullet.”
