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Is Obamacare Working?

July 15, 2014 in Economics

By Michael D. Tanner

Michael D. Tanner

Two recent surveys have shown a significant reduction in the number of Americans without health insurance since the start of Obamacare in October 2013. According to the Commonwealth Foundation, the uninsured rate fell from 20 to 15 percent, while Gallup found a decline from 18 to 13.4 percent. Both surveys indicate that roughly 8 million Americans have gained insurance over the past ten months.

All of which has led Obamacare supporters to pop the Champagne corks. As New York Times columnist Paul Krugman wrote for perhaps the hundredth time since 2010, “Health reform is — gasp! — working.”

The questions are: How many people are covered? And, How good is their coverage?”

It is still unclear, though, how much of the credit for the drop in the number of uninsured should go to Obamacare. Unemployment has declined from 7.2 percent to 6.1 percent over the same period, meaning that at least some previously unemployed Americans have found work. Since health insurance remains largely tied to employment in this country, job gains should naturally translate into insurance gains. Neither survey breaks this down.

Still, it is reasonable to conclude that Obamacare was responsible for at least part of the increase in coverage. Many observers, myself included, thought the rollout of healthcare.gov was so hopelessly messed up that Obamacare enrollment would fall far short of its goals. That the administration appeared to fudge many of its early enrollment numbers seemed to bear this out. We should now admit that we were probably wrong. In hindsight, we should have realized that if you are essentially giving something away — 91 percent of Obamacare enrollees either are receiving subsidies or are on Medicaid — people will take it.

But before we go too far with the mea culpas, it is important to point out that we remain far short of universal coverage. Even with this “success,” the uninsured rate will still be roughly where it was in 2001.

Nor do the new numbers tell us anything about the quality of coverage that people are receiving. Gallup, for example, did not differentiate between private insurance and Medicaid. Using Commonwealth Fund data on proportions of enrollees who were previously uninsured and official government enrollment figures, it appears that roughly 49 percent of the newly insured are being covered through Medicaid. We also know that the decline in uninsured residents has been three times as large in Medicaid-expansion states as in …read more

Source: OP-EDS

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