The following post first appeared on FactCheck.org.
President Barack Obama made misleading and exaggerated claims in a speech boasting of the accomplishments of the Affordable Care Act.
- Obama claimed that those who already had insurance before the law was passed “got a better deal now” than they did before, because of insurance coverage protections and requirements in the law. But those added benefits came at a higher cost for some. Better coverage didn’t mean a “better deal” for everyone.
- The Web page promoting the speech claims that “129 million people who could have otherwise been denied or faced discrimination now have access to coverage.” But most of those individuals already had “access to coverage” — they got it through their employers before the ACA’s marketplaces were launched.
- Obama said the rate of the uninsured is at “its lowest level ever.” That’s unclear. His Council of Economic Advisers analyzed National Health Interview Survey data, which show the uninsured rate for the first nine months of 2014 (the most recent data available) was slightly higher than a few years several decades ago.
- The president said family premiums are “$1,800 lower today” on average than they would have been if premium trends that existed before the ACA had continued. It’s true premiums have increased more slowly in recent years than they did before the ACA, but even the president’s own economic advisers say the law isn’t responsible for the entire slowdown.
A ‘Better Deal’
Obama spoke on June 9 at the Catholic Health Association Conference in Washington, D.C. His remarks came at a critical time for the Affordable Care Act: The Supreme Court is expected to rule soon on a case that could impact subsidies available through state marketplaces run by the federal government.
The president said that before the ACA was passed, 85 percent of Americans already had health insurance. (That’s about right.) He went on to say that they still got “a better deal” under the health care law.
Obama, June 9: That 85 percent who had health insurance, they may not know that they got a better deal now than they did, but they do. Americans can no longer be denied coverage because of preexisting conditions, from you having had cancer to you having had a baby. Women can’t be charged more just for being a woman. And they get free preventive services, like mammograms. And there are no more annual or lifetime caps on the care patients receive.
The ACA did include all of those insurance coverage mandates, which strengthen coverage and protections for individuals. But is that “a better deal” for everyone who had insurance before the ACA? Certainly not.
As we’ve long said, individual market coverage, for those who bought their own insurance, varied widely in terms of coverage and premiums before the health care law was passed. For those who were healthy, premiums could be significantly less than what others were charged. But not anymore. The ACA doesn’t allow insurers to vary rates based on health status. And it requires a certain level of minimum benefit standards. That’s good news for some — such as people with health conditions that boosted their premiums. Others now pay more, as basic plans for healthy folks are no longer available.
With such major changes to how the individual market is priced and how it operates, there were going to be some who got better deals and others who didn’t. Even then-Health and Human Services Secretary Kathleen Sebelius acknowledged that before the exchanges launched. In March 2013, she said: “Women are going to see some lower costs, some men are going to see some higher costs. It’s sort of a one-to-one shift … some of the older customers may see a slight decline, and some of the younger ones are going to see a slight increase.”
Access to Coverage
The White House promoted the president’s speech with a Web page that made the misleading claim that “129 million people who could have otherwise been denied or faced discrimination now have access to coverage.” This is an old claim we first wrote about in 2011, but the White House has been pushing it again.
The number is the high end of an administration estimate of non-elderly adults who could be denied coverage if they were seeking it on the pre-ACA individual market. (Insurers on the individual market used to be able to deny coverage for medical reasons, but now insurance companies have to offer insurance to anyone who wants it.) But most people weren’t seeking insurance on the individual market before the ACA, nor are they doing it now. And these 129 million people — that’s half of all non-elderly adults in the United States — didn’t lack “access to coverage.” In fact, the vast majority already had it.
The administration analysis — released by the Department of Health and Human Services — found that this 129 million number included “[a]s many as 82 million Americans with employer-based coverage” who had a preexisting condition “ranging from life-threatening illnesses like cancer to chronic conditions like diabetes, asthma, or heart disease.”
Before the ACA, those with coverage through a large employer already had protections for preexisting conditions, including protections through the Health Insurance Portability and Accountability Act of 1996.
The administration does have a point in that these individuals could have been denied coverage, charged a higher premium or had their coverage of preexisting conditions limited if they had to seek coverage on the individual market without the Affordable Care Act’s protections. HHS wrote in the report: “Without the Affordable Care Act, such conditions limit the ability to obtain affordable health insurance if they become self-employed, take a job with a company that does not offer coverage, or experience a change in life circumstance, such as divorce, retirement, or moving to a different state.” That’s correct. But with or without the health care law, most Americans would still get their insurance coverage through work (see the Congressional Budget Office’s latest table on the effects of the law on insurance coverage).
The HHS report said that the 129 million number included 25 million who were uninsured. It also said 43 percent of those who had coverage on the individual market had a preexisting condition. A Kaiser Family Foundation report published in May estimated that 10.9 million people were on this market in 2011, when the HHS report was released.
These individuals — the uninsured and individual market policyholders — are most likely to be affected by the ACA’s mandate that they not be denied or charged more for preexisting conditions. And some who had coverage through work may have held onto their jobs just for the insurance. But it’s misleading and an exaggeration for the Obama administration to claim that 129 million people with preexisting conditions “now have access to coverage” because of the ACA.
Obama repeated a version of a claim he made in January during his State of the Union address, saying that the “uninsured rate” was at “its lowest level ever.” This could turn out to be the case, once data for all of 2014 and early 2015 are available. But the most recent government data only capture the first nine months of 2014, when the rate of the uninsured was slightly higher than the rate for 1974, 1978 and 1980.
The president’s claim is based on an analysis of data released by the Centers for Disease Control and Prevention’s National Center for Health Statistics. The data come from the National Health Interview Survey conducted by the Census Bureau. The latest release includes data from more than 85,000 people, so it’s comprehensive — but only encompasses January through September for 2014. The percentage of uninsured, for all ages, for those nine months was 11.9 percent, a significant drop from the 16 percent uninsured for 2010, the year the ACA was enacted.
But 11.9 percent isn’t the “lowest level ever.” Obama’s Council of Economic Advisers analyzed NHIS data in December 2014, adjusting some previous years’ figures for changes in survey construction. Its chart on years dating back to 1963 show that there was a lower rate of uninsured (11.4 percent) in 1974, 1978 and 1980 (see the table on page 11).
It’s possible the uninsured rate for all of 2014, and the first quarter of 2015, will be lower than it was for just the first nine months of last year. The open enrollment period for the insurance marketplaces didn’t begin until Nov. 15, 2014.
The Gallup-Healthways Well-Being Index survey, which included more than 43,000 adults for the first quarter of 2015, put the uninsured rate for adults, age 18 and older, at 11.9 percent. That’s the lowest rate the survey has found, but it only began tracking such figures in 2008.
The president improved upon a claim about premiums that we fact-checked in March. In his June 9 speech, Obama said: “The average family premium is $1,800 lower today than it would have been had trends over the decade before the ACA passed continued.” That’s correct. Last time, Obama said this was “$1,800 in people’s pockets,” which is false.
We’ll still note that the slower-than-expected growth in premiums is only partly attributable to the ACA, according to the president’s Council of Economic Advisers.
The CEA’s September 2014 report used information from the Kaiser Family Foundation’s annual surveys of employer-sponsored health plans to determine that “[i]f premiums growth had matched its 2000-2010 average since 2010, the average premium would be $1,800 higher today.”
Premiums for employer plans have been growing at low rates in recent years, but as we have written before, experts attribute the slowdown mostly to the sluggish economy. The CEA gave the health care law more credit, saying “a significant fraction of the recent slowdown in health care price inflation can be linked to Medicare reforms in the Affordable Care Act.” But it didn’t say how much of the $1,800 difference was due to the ACA.