After Obamacare: Myths & Facts

Myth: Under repeal of the ACA, one million Pennsylvanians will lose their insurance.
Fact: Many of these Pennsylvanians were covered before the ACA. 

This myth erroneously assumes everyone purchasing insurance on the exchange or enrolled in Medicaid will lose all access to insurance. U.S. Census data shows the number of uninsured Pennsylvanians declined by only 469,000 residents from 2010 to 2015. This gap implies many Pennsylvanians on the exchange or in Medicaid were insured before the ACA. In fact, the state reports almost 16% of newly eligible Medicaid expansion enrollees were previously enrolled in another type of health care insurance.

It’s also important to note that the state shifted 73,000 individuals already enrolled in Medicaid to the expansion Medicaid population. This was done entirely as an accounting gimmick to ensure the federal government would pick up a larger portion of Medicaid costs.

Myth: Hospitals will lose $1.6 billion in revenues leading to possible closures.
Fact: The ACA did not improve hospitals’ long-term sustainability. 

Hospitals are struggling because the cost of medical care is rising. Focusing on redistribution schemes rather than driving down the cost of care is no solution. The Department of Human Services(DHS) states health care providers received more than $1.8 billion dollars in payments for serving newly eligible Medicaid expansion enrollees. However, these payments aren’t covering the full cost of the care. Medicaid pays on average 61% for physician services.

A May report from the Health Care Cost Containment Council found an 8.6% decline of general acute-care hospital uncompensated care in 2015 compared to 2014. Yet, more hospitals reported negative operating margins. Between 2012 and 2014, 34 hospitals realized average losses, but from 2013 to 2015, 46 hospitals realized losses.

Reducing the cost of uncompensated care through more taxpayer subsidies is a payment shift that will ultimately leave local economies weaker.

Myth:: Repeal will cost 137,000 jobs by 2019 and reduce the state GDP by $76 billion.
Fact: These forecasts are based on debunked models that assume government spending creates jobs.

The job loss estimate comes from the Commonwealth Fund, which wrongly assumes any ACA alternative will eliminate all insurance subsidies.

In reality, Pennsylvania lost jobs due to the ACA’s mandates and taxes. The American Action Forum estimates Pennsylvania lost 15,680 small business jobs due to the law in 2015. Statewide unemployment remained above the national average throughout last year. In fact, we experienced the second largest increase in unemployment during 2016.

On the other hand, the ACA failed to live up to economic projections. According to DHS, Medicaid expansion created 15,500 jobs in 2015, but a 2013 RAND study estimated expansion would create about 37,500 jobs in 2015.

Read the full After Obamacare Policy Points here.