The Truth About Obamacare
Overview
Americans are unhappy with the health care system — for good reason. Navigating the system can be painful. And complicated. And way too expensive. Skyrocketing insurance premiums are straining family budgets, while government and insurance company bureaucrats exert tight control over access to doctors and treatments.
Obamacare (aka the Affordable Care Act) was supposed to fix these problems — at least, according to those who created the program. But did it?
So, we decided to look at what Democrats have said about Obamacare and compare that to what has actually happened, and let you decide for yourself.
Rhetoric
“If you like the plan you have, you can keep it.”
Reality
This oft-repeated promise made by Barack Obama was PolitiFact’s 2013 “Lie of the Year” for good reason. No sooner was the ink dry on the new law than health insurance companies began dropping millions from insurance policies that did not comply with Obamacare’s mandates regarding “essential health benefits.” Estimates vary, but between 2.6 million and 7 million Americans lost insurance in 2013 alone. And when they switched to an Obamacare plan, they were forced to pay for coverage they didn’t want or need.
Rhetoric
“In an Obama administration, we'll lower premiums by up to $2,500 for a typical family per year.”
Reality
As even the Washington Post had to admit, “The real problem is that the Affordable Care Act was never actually affordable.” Since Obamacare’s enactment, health insurance premiums have skyrocketed, from $15,000 a year for an average family to about $27,000. In 2011, America spent $2.7 trillion on health care. Last year, it was $4.9 trillion. President Obama said his plan would “bend the cost curve.” He bent the curve, all right, but he bent it up, not down.
Rhetoric
“I will not sign (the health care law) if it adds one dime to the deficit, now or in the future, period.”
Reality
Obamacare has been a budget-buster since it was signed, and there is no sign that it will ever save money. The Congressional Budget Office’s (CBO) most recent projections indicate that federal spending on Obamacare subsidies from 2026 to 2033 is now expected to be $490 billion. That is 91% higher than the CBO projected when President Biden took office. And as the Paragon Institute pointed out, “Importantly, this period excludes Biden’s Covid credits — enhanced Obamacare subsidies that also exploded fraud and waste in the program — since those expire after 2025.”
Rhetoric
“Losing the health care tax credit would be devastating for millions of Americans.”
Reality
Why do Democrats believe it would be devastating to return to the Obamacare of four years ago? After the Covid credits expire, the government will still pick up more than 80% of the cost of the premium for the typical Obamacare enrollee. Yet to hear the Democrats tell it, a return to pre-Covid Obamacare would be a catastrophe for the American people — a tacit admission that they don’t think the health insurance scheme they’ve lauded for the past 15 years is actually very good.
Rhetoric
“[Extending the Obamacare enhanced subsidies] is not additional government spending.”
Reality
The Democrats increased and expanded access to Obamacare subsidies as a temporary Covid measure. According to Joe Biden, these subsidies were enacted as “an economic bridge through the crisis,” and to “tackle the urgent public health and economic crises the Nation faces as a result of Covid-19.” Those higher Covid subsidies will expire at the end of 2025, and the Congressional Budget Office said making them permanent would increase the deficit by $350 billion from 2026 to 2035. So, yes, extending Biden’s temporary Covid handouts is additional spending and comes with a hefty price tag.
Rhetoric
“We extended the Affordable Care Act tax credits in 2022 for three years. The program is working.”
Reality
Obamacare’s subsidy program is not working. The higher Covid credits have spawned massive enrollment fraud, including 12 million phantom enrollees who never use their coverage and may not even be aware they are enrolled. Overall, Obamacare wastes an estimated $27 billion a year on payments for people who are not eligible for the level of subsidies they’re receiving —that’s one in five dollars lost to waste, fraud, and abuse. According to the Paragon Institute, Biden’s Covid handouts “caused a surge of enrollment in the exchanges and higher insurer profits, although many new enrollees were ineligible, unaware they were signed up, or never used their plan.”
Rhetoric
“Republicans are refusing to even consider extending the Affordable Care Act tax credits.”
Reality
Democrats have been purposely distorting this issue, framing it as “Obamacare subsidies are expiring,” giving the impression that there won't be any subsidies after December 31. Baloney. We are not talking about “ACA subsidies,” but the subsidy add-ons that were meant to help Americans get through Covid. When the higher subsidies expire, all that will happen is a return to the subsidy levels that existed before Covid. Inflated Covid-era ACA subsidies were always meant to be a temporary fix, not a permanent expansion of government. They are a relic from the Covid-era, and Americans are done with that!
Rhetoric
“If Republicans succeed in letting ACA subsidies expire, a couple making 85k/year will see their health care premiums skyrocket to $25,000. Almost 30% of their income!”
Reality
A couple making $85,000 a year is at 400% of the federal poverty level. If the Covid credits had not been enacted, that couple would not be eligible for any subsidy for the very good reason that, at that income level, they should be able to pay their own way. Letting the Covid credits expire will restore the 400% of poverty income cap that Democrats themselves instituted when they enacted Obamacare. It’s not the couple’s fault that Obamacare plans now cost $27,000 a year on average, nearly double what they cost before Obamacare, or that affordable insurance options are hard to come by, thanks to Obamacare’s costly mandates. Letting the subsidies expire simply reveals how unaffordable the Affordable Care Act has made American health care — and why, instead of doubling down on failure with a big $40 billion a year Obamacare bailout, we need sensible, consumer-empowering reforms to make health care affordable again.
Rhetoric
“We want to ensure that 24 million Americans don’t see their premiums double.”
Reality
Premiums will not change. Instead, subsidies will go down a bit. The vast majority of Obamacare enrollees will still receive a subsidy, and it will be a very generous subsidy, covering 80% of the price of an insurance policy on average, instead of 90% under the Covid credits. According to CMS, in 2026, the average monthly premium, after subsidies, for the lowest-cost plan will actually be $20 less expensive than the monthly premium after subsidies in 2020. i Most Obamacare enrollees pay less than $100 a month for their coverage. Sixty percent of enrollees have access to a plan costing less than $50 a month. More than half pay nothing at all because the Covid credit makes coverage 100% free for them. Letting the Covid credits expire will take us back to the Democrats’ original policy, which was that everyone should have some skin in the game and pay at least something toward the cost of their coverage. Percentage comparisons are misleading. In dollar terms, the increase from going back to the Obamacare of four years ago will be small. For most recipients, it will amount to a dollar or two a day.
Rhetoric
The bill to increase Obamacare subsidies “would provide Americans and their communities an economic bridge through the [Covid] crisis.”
Reality
This is a classic example of Ronald Reagan’s quip that “nothing lasts longer than a temporary government program.” Covid is over. The masks are gone. Kids are back in school, and Americans are back working. Temporary means temporary. Yet the left now wants to take this temporary program and make it a permanent expansion of government. Their goal is obvious — suck more and more Americans into government health insurance to pave the way for a complete government takeover of the health care system. We cannot let them get away with it.
Rhetoric
“It’s about jobs. In its life [Obamacare] will create 4 million jobs — 400,000 jobs almost immediately.”
Reality
There is zero evidence that Obamacare has created any jobs. In fact, due to Obamacare’s perverse incentives, the Congressional Budget Office initially predicted that it would result in 800,000 fewer jobs and later expanded that to 2.3 million fewer jobs. CBO reasoned that by expanding Medicaid to able-bodied men and heavily subsidizing marketplace health insurance plans, Obamacare would give poor people less incentive to work, so they would remove themselves from the labor pool. We should be doing all we can to increase labor force participation, not discouraging it.
Rhetoric
“What this plan will do is make the insurance you have work better for you.”
Reality
Obamacare has been a boon for insurance companies, particularly since Biden’s Covid credits vastly expanded Obamacare subsidies and the number of enrollees who qualify for them. These new, higher subsidies, which are paid straight to insurers, led to an explosion in fraudulent spending. In just one case, an unscrupulous broker in Florida signed up vulnerable populations for free Obamacare plans, costing the government $134 million — all sent straight to insurers. In a nutshell, the Democrats’ plan is to extend inflated taxpayer subsidies to health insurance companies to prevent Obamacare premiums from rising. It’s time to end this insurance company windfall.
Rhetoric
“This is a big f***ing deal.”
Reality
Joe Biden was right … just not in the way he thought. The Democrats were so confident that Obamacare would usher in a new era of affordable health care that Biden’s quip quickly became a catchphrase for supporters of Obamacare and was used to sell t-shirts and other merchandise to benefit the Democratic National Committee. But if we judge Obamacare by what its supporters said would happen versus what has happened, it is clear Obamacare has not lived up to any of the promises made by those who wrote the law, and that’s a big … shame.