WikiLeaks recently exposed a Clinton campaign memorandum on the shortcomings in the Affordable Care Act. Well, at least they understand that there are shortcomings. These shortcomings include:
1. Penalties that are insufficient to draw in young, healthy Americans
2. Disappointing enrollment at less than half of the Obama administration’s projections primarily due to the lack of affordability for people earning greater than 250% of the federal poverty level
3. Higher adverse selection than anticipated
4. Higher cost-sharing contributing to poor participation because of perceived “lack of value”
5. Insufficiency in the risk-protection mechanisms intended to insulate insurers from the impact of the prior four point.
The November 2015 memorandum pre-dates and wrongly predicts Aetna and Blue Cross Blue Shield’s commitment to remain in the exchanges. It also incorrectly predicted that the increase in the 2016 penalty would result in dramatically increased enrollment. They naively asserted that the Republicans would play ball and help pass corrective legislation to fund the risk-corridor program.
The memo did get one thing right. It advised Secretary Clinton and her campaign that the positioning “…should be … amend[ed]… [in order to]… inoculate her on any possible future problems and as a thoughtful and strong contrast to Senator Sanders and the Republican Presidential candidates.”
I think the Clinton administration should consider tapping me as an adviser. I saw all of their shortcomings far in advance, and my past blog posts on the FrenkelySpeaking blog prove that I have been correct on their misses (see here for lack of affordability, here for risk corridor shortfalls, here for increasing adverse selection, and here for impact of cost-sharing). I want to go on record to advise that the possible solutions also have issues.
Clinton is proposing more tax credits to increase affordability and to extend the risk-corridor program. This is just going to shift costs to the taxpayers and prevent the needed medicine: going after the “cost of care.”
I strongly advocate a private-sector solution. The ACA has set the framework; I will once again call for the government to step aside and let the free market work.
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