November is here, and in most US states, this means the start of open enrollment, the filing period for taking out insurance on the stock exchanges of the US Affordable Care Act. It also means that we have to face a few days before a choice that focuses on health care. One thing that is likely to be strengthened, and not in exceptional danger of existential danger, is this important part of President Obama's signing law.
Enrollment is likely to decline slightly for the third year in a row after a GOP tax bill has cleared the single mandate and removed the fine for those who did not sign up for the insurance. However, if you look beyond the headlines, the individual market will become increasingly stable and, depending on the midterm elections, perhaps only in the context of a friendlier congress.
For years the market has survived republican hostility. In addition to supporting a wind-up attempt, the Trump administration has cut funding for supportive programs, helped end the mandate, and promoted short-term plans that will allow healthy people to be withdrawn from the market.
But ACA's price-based subsidies for low-income Americans have helped keep it alive. Even if insurers raise premiums, many can afford insurance. Politically, the protection of the law has become so popular for existing conditions that it has undermined the GOP's efforts to repeal and replace the law. There is a reason why many Democrats are in health care while their opponents are weakening. And although Obamacare is still subject to a legal threat from a Trump lawsuit trending ahead of several red states, it has deteriorated further in the past.
According to the Medicare and Medicaid Services Centers, premiums for a popular package have dropped in 17 states. Without loose rules for short-term insurance and the end of the mandate, the premiums would probably be even lower.
On Wednesday, Molina Healthcare Inc., an insurer with a strong single market presence that bled money last year, announced third-quarter results that exceeded analysts' expectations. Success is not alone: this is 2011, when insurers are the most profitable year since 2011, driving many of them to expand into new markets. This is a significant difference from past years, marked by losses, significant premium increases and insurers who have fled the market.
Stable does not mean healthy. There are now two very different individual markets. In one case, subscribers are protected by subsidy scales. On the other hand, people who make a bit of money are faced with increased premiums for years. This limits the enrollment and has taken many off the market.
The most likely result for the mid-term – Democrats who are withdrawing the House but slimming the Senate – can only help. Gridlock is better than murder attempt. There would be no further attempts to kill the law in this scenario, and the administration would have more oversight.
A good result for the Democrats would give good impetus to the other big part of the ACA, its extension of Medicaid to more low-income Americans. Enlargement is on the agenda in a number of red states, be it explicitly through an electoral initiative or implicitly through a race of a close governor. And although the expansion of Medicaid will push some patients out of the individual market, they tend to be more of a health problem, so the net effect is further stabilization.
Freed from the question of whether it will continue to exist, the individual market is finally approaching a low point and possibly even a success.
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Max Nisen is a Bloomberg Opinion columnist for the biotech, pharmaceutical and healthcare industries. Previously, he wrote about management and corporate strategy for Quartz and Business Insider.
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