Evaluating the Affordable Care Act: Successes, Shortcomings and Steps Forward

The views expressed are those of the author and do not necessarily reflect the views of ASPA as an organization.

By Noah Ndhlovu
July 8, 2024

The Affordable Care Act (ACA), enacted in 2010, marked a significant transformation in the United States healthcare landscape. With its primary goals of expanding access to insurance, improving the quality of care and curbing rising healthcare costs, the ACA has been a subject of intense debate and scrutiny. Over a decade later, it is crucial to evaluate what has worked, what hasn’t and what steps can be taken to further improve the system.

Successes of the ACA

1. Increased Insurance Coverage: One of the most lauded achievements of the ACA is the significant reduction in the uninsured rate. The expansion of Medicaid in many states and the establishment of health insurance marketplaces have enabled millions of Americans to gain coverage. According to the U.S. Census Bureau, the uninsured rate dropped from 16 percent in 2010 to 8.6 percent in 2021.

2. Protections for Pre-existing Conditions: The ACA prohibits insurance companies from denying coverage or charging higher premiums to individuals with pre-existing conditions. This provision has been a lifesaver for many Americans who previously faced insurmountable barriers to obtaining coverage.

3. Young Adult Coverage: The law allows young adults to remain on their parents’ insurance plans until age 26. This measure has provided a safety net for millions of young people transitioning into the workforce.

4. Preventive Services: The ACA mandates that many preventive services, such as screenings and immunizations, be covered without cost-sharing. This emphasis on preventive care aims to catch health issues early and reduce long-term healthcare costs.

Shortcomings of the ACA

1. Affordability Issues: Despite its name, the ACA has not completely resolved the issue of affordability. Premiums and out-of-pocket costs remain high for many individuals, particularly those who do not qualify for subsidies. The affordability challenge is exacerbated by rising prescription drug prices and the high cost of medical services.

2. Medicaid Expansion Gap: While the ACA expanded Medicaid eligibility, not all states have opted into the expansion. As a result, millions of low-income adults in non-expansion states fall into a coverage gap, earning too much to qualify for traditional Medicaid but too little to afford marketplace insurance.

3. Complexity and Bureaucracy: The ACA introduced a range of new regulations and reporting requirements that have added complexity to the healthcare system. Both consumers and providers often find the system cumbersome and difficult to navigate.

4. Insurance Market Instability: The individual insurance marketplaces have experienced periods of volatility, with some insurers exiting the markets and others significantly raising premiums. This instability has created uncertainty for consumers and insurers alike.

Recommendations for Improvement

1. Enhance Affordability: To address affordability, policymakers could consider increasing subsidies for marketplace plans and capping out-of-pocket costs. Additionally, measures to rein in prescription drug prices, such as allowing Medicare to negotiate prices, could alleviate financial burdens on consumers.

2. Medicaid Expansion Incentives: To encourage more states to expand Medicaid, federal policymakers could offer additional financial incentives or penalties. Ensuring that all low-income individuals have access to coverage is essential for closing the existing gaps.

3. Simplify the System: Efforts to streamline the enrollment process and reduce administrative burdens could make the system more user-friendly. Simplifying the application process for subsidies and insurance plans would help consumers better understand their options and make informed choices.

4. Stabilize Insurance Markets: Policymakers should consider policies that stabilize the individual insurance marketplaces, such as reinsurance programs that help cover high-cost claims. Ensuring a stable market environment would make it easier for insurers to offer affordable and comprehensive plans.

5. Expand Preventive Care Programs: Investing in community health programs and preventive care initiatives can reduce the long-term costs of chronic diseases. Expanding access to preventive services beyond those currently mandated by the ACA could result in healthier populations and lower healthcare expenditures.

The Affordable Care Act has made significant strides in expanding access to healthcare and protecting vulnerable populations. However, challenges remain in making healthcare truly affordable and accessible for all. By addressing the shortcomings and building on the successes of the ACA, policymakers can create a more equitable and efficient healthcare system. As we look to the future, a continued commitment to innovation and reform is essential to meet the evolving needs of the American public.

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Author: Noah Ndhlovu is a doctorate student with extensive experience in public administration and healthcare policy. He served for the Indiana Department of Health (IDOH) as a statewide program director for 6 years. With a passion for analyzing and improving public systems, Noah provides insightful commentary on the intersection of government and societal well-being. You can get in touch with Noah using [email protected]

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