NCPA - National Center for Policy Analysis

ObamaCare Will Add to the Fiscal Burden

October 4, 2013

The rollout of the Affordable Care Act (ACA) thus far has been characterized by missed milestones, a lack of clarity and partisan squabbling. But does this inauspicious beginning mean that the law will fail in its goal to make health care more available to and affordable for all Americans, or will the ship right itself before it sinks, asks Joseph Antos, the Wilson H. Taylor Scholar in Health Care and Retirement Policy at the American Enterprise Institute.

The American public is concerned with three major aspects of the law: the access to coverage, the affordability of coverage, and how the changes will benefit them. On all three counts, the ACA will fail to live up to the promises made by the Obama administration. Despite that, the law will have a profound impact on the U.S. insurance market.

  • Right out of the gate, the ACA has already hit several roadblocks, including a delay in implementation of its key provision, the employer mandate.   
  • Individuals face a number of unknowns regarding the ACA, including ease and affordability of obtaining coverage through exchanges and the effect it will have on their employer plans. 
  • The ACA will be neither an unqualified success nor a total failure, but it will change the face of the U.S. insurance market and add to the country's fiscal burden.

Another less than appealing aspect is the individual mandate. It will cause some people to buy exchange coverage who otherwise would not have, but not because of the penalty. The mandate is an attempt to establish a new social norm that remaining uninsured is unacceptable. The massive media campaign that is soon to be unleashed will try to break through the defenses of reluctant consumers. Backing up the message is a wad of cash, courtesy of the taxpayer.

The ACA will not be the success its supporters want it to be. It will also not be the disaster its opponents think it will be. But it will cause permanent changes -- some good, some bad -- in the way health insurance is purchased in this country, and it will add to the growing fiscal burden that threatens to damage the health of the economy.

Source: Joseph Antos, "ObamaCare: Destined to Flop?" American Enterprise Institute, September 25, 2013.


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