Affordable Care Act

The problem with the Affordable Care Act {ACA}, President' Obama's signature legislation that aimed to bring the majority of Americans affordable healthcare never was the idea.  Whether you disagree with  having universal healthcare or think the way it was brought into being and it's implementation was flawed, nearly everybody can agree that what we had before wasn't working.  As most doctors will tell you we already had universal healthcare.  It was called the emergency room at your local hospital.    Over the years with kids I made more than my fair share of visits to the emergency room at Loyola Hospital in Maywood, Illinois.  One of those included an emergency appendectomy for my daughter at 2:00AM!  The emergency room at Loyola was plastered with signs in English, Polish, and Spanish saying that you could not be turned away for service for inability to pay.

It is not the place here to debate the morality of healthcare or the contentious and sometimes fictitious way ACA was fostered on the American public.  Rather I want instead to point out the economic problem that always was at the heart of ACA.  Instead of mandating universal healthcare which the Obama Administration knew it could never get through Congress, it instead implemented a series of healthcare exchanges.  In a nutshell whether on a state or on the Federal system people could pick from a series of insurance companies a health plan that fit into their budget and their needs.  People with insufficient resources could get their plans subsidized by the Federal Government.  

The flaw in the system always was that the exchanges were expected to be populated with poorer, older and sicker people.  It was feared these folks would sign up in much higher numbers than younger, healthier folks and that's exactly what happened.  Too force more of these younger people into the system, a series of financial penalties was enacted if they didn't sign up for a plan.  Yet even with all of that the system has turned out to be older, poorer and sicker than originally envisioned or sold to the American public.  Thus this year we have seen many insurance companies raise their premiums significantly and now, today, news is out that the insurance giant United Health is talking about possibly leaving the system in 2017.  This may be a real problem or the opening salvo by the company and the rest of the insurance industry for higher premiums and less coverage of the sickest Americans.  Either way it is indicative of a system that even in its early stages was poorly conceived on a financial basis and may already be broken.

We are told there is no inflation today in the United States.  The Consumer Price Index would seem to support that.  However, that cannot be the experience of the average American, particularly the large segment that has seen their wages stagnate these past 10 years.  Rent, food, college education and healthcare are large portions of their budgets that have seen their costs skyrocket.  Until we get a handle on these things or find a way to pay people more we will see the majority of Americans continue to struggle and economic growth stuck in a paltry 1-2% range.