In 2008, then-presidential candidate Barack Obama promised his administration would “lower premiums by up to $2,500 for a typical family per year,” and that this would be accomplished by “investing in disease prevention, not just disease management; by investing in a paperless health care system to reduce administrative costs; and by covering every single American and making sure that they can take their health care with them if they lose their job. We’ll also reduce costs for business and their workers by picking up the tab for some of the most expensive illnesses.”
Ten years later, the ObamaCare system built by President Obama and congressional Democrats is unquestionably failing to deliver on these and many other promises. Health Pocket reports the average monthly premium in 2018 for 30-year-olds enrolled in a Silver Plan — the mid-level health insurance plan offered in ObamaCare exchanges — is $477. Forty-year-olds pay on average $536, 50-year-olds pay $750, and 60-year-olds pay a whopping $1,139 per month. Compared to 2017, the average Silver Plan premium increased by 31 percent across all age groups. Further, Health Pocket reports average Silver Plan premiums have increased by 68 percent since 2015.
{mosads}However, premiums are not the most important factor when considering just how badly ObamaCare has failed in its mission to provide affordable health coverage. Insurance deductibles — the amount people have to pay before their insurer picks up all or nearly all of the health care costs incurred — is a much more important measure, and deductibles and total out-of-pocket expenses have reached astronomical heights. The average maximum out-of-pocket expenses required for a family Silver Plan is now $13,725. Most lower- and middle-income families don’t have $13,725 in their bank accounts that they can spend at a moment’s notice in the event of a medical tragedy, making many ObamaCare health insurance policies virtually useless in a health care crisis.
When President Donald Trump entered the White House, he inherited the health care chaos the Obama administration left behind. Trump attempted to push the Republican-led Congress to repeal and replace ObamaCare, but, as usual, Congress couldn’t get the job done, largely because so-called “moderate” Republicans were totally unwilling to do anything other than make slight tweaks to a collapsing system. At best, moderates’ proposals would have put a Band-Aid on the ObamaCare bullet wound.
Without congressional action, the Trump administration’s options have been and will continue to be limited, but President Trump is doing everything he can to provide people with additional, more affordable health care options. For instance, in June, the Department of Labor finalized a rule permitting sole proprietors, small business owners, and employees of small businesses to join together to purchase association health plans. Under the rule, workers with a “commonality of interest,” such as living in the same state or working in the same industry, will be able to purchase group health insurance, just like large corporations. Group health insurance is much cheaper than individual insurance plans because a large group has significantly more negotiating power than an individual, insurance can be purchased across state lines, and the costs are spread out among many people. It’s also important to note that association health plans will provide coverage to people with pre-existing conditions, and they won’t charge sicker people more money for their insurance.
Earlier in August, the Trump administration made another significant change, dramatically expanding short-term, limited-duration health insurance plans to 12-month periods, which can be renewed for up to a total of 36 months. Under the Obama administration, short-term plans were limited to just three months, making them too burdensome and ineffective for the overwhelming majority of Americans who might be interested in purchasing a short-term plan.
Short-term health insurance plans aren’t meant to provide comprehensive coverage, so if you or your family have a lot of existing and costly health care problems, they aren’t a good option. But for relatively healthy people, especially younger Americans and people between jobs, short-term plans can provide affordable catastrophic health care coverage. Most plans cost far less than $200 per month, more than half of what the average ObamaCare Silver Plan costs. Although the deductibles are often high for these plans, those who purchase them can use the savings resulting from paying a lower premium to offset any additional health care expenses, and in many cases, the deductibles are similar to what many ObamaCare plans offer.
These reforms might seem small, but together, the Congressional Budget Office (CBO) and the Joint Committee on Taxation (JCT) project that by 2023, six million people will choose to enroll in an association health plan or short-term insurance plan. Further, CBO and JCT say “the rules would decrease the number of uninsured people by roughly 1 million in 2023 and each year thereafter, with the majority of the previously uninsured enrolling in STLDI [short-term, limited-duration] plans.”
More reform is needed, and the health-care system is still suffering from the effects of ObamaCare and decades of poor policy decisions by politicians in both parties. But President Trump is doing far more to increase health-care freedom than the past three presidents combined, and his administration is accomplishing this impressive feat largely without the help of Congress. President Trump and his entire administration deserve to be praised for helping millions find affordable health coverage.
Justin Haskins is executive editor and a research fellow at The Heartland Institute, an Illinois-based nonprofit that advocates for limited government, and a research fellow at The Henry Dearborn Institute for Liberty, a free-market association of scholars.