Obamacare in Pictures

Obamacare in Pictures VISUALIZING THE EFFECTS OF THE PATIENT PROTECTION AND AFFORDABLE CARE ACT Spring 2014

If you like your health care plan, can you really keep it? At least 4.7 million health care plans in the individual market have been discontinued due to new Obamacare rules. WA 290 OR 135 NV 25 CA 1,100 AK 5.4 ID 105 UT AZ MT WY 3.2 CO 327 NM 26 HI ND 47 SD NE KS OK TX MN 140 IA 1 MO AR LA 93 NH VT 22 WI NY MI 100 225 PA 250 IL IN OH 185 108 WV VA KY 130 NC TN 60 184 SC MS 0.5 AL GA 90 400 FL 333 ME MA RI CT 66 NJ 150 DE 12 MD 73 DC 21 POLICIES SCHEDULED FOR CANCELLATION (THOUSANDS) 200+ 100 200 10 100 0 10 Data not available Cancelled plans switched automatically Source: Associated Press, December 26, 2013.

Obamacare will require employers to make changes to their health care plans Those with employer coverage might not be able to keep their existing plans either. The vast majority of businesses expect to make changes to their health care plans to comply with Obamacare s regulations, and more than half of those anticipate the changes to be significant or drastic. BUSINESSES ANTICIPATING CHANGES TO THEIR EMPLOYER-SPONSORED HEALTH CARE BY 2018 50% 40% 30% 20% 10% 0% 3% Complete transformation 44% 45% Significant change Modest change 8% No change or small change Source: Towers Watson/NBGH Employer Survey on Purchasing Value in Health Care, 2013.

Premiums are higher in Obamacare exchanges: Age 27 Buying individual health insurance in the exchanges is generally more expensive than it was before Obamacare, especially for young adults. In 11 states, 27 year olds will see premiums double or more. WA VT NH 73% 144% 1% MT ME ND 43% 26% OR 113% 55% MN ID 15% MA n/a 86% SD WI NY WY 94% 99% 29% RI 28% MI 26% 118% CT 64% PA NV IA NE 32% NJ 3% 2% 12% UT 71% IL OH IN DE 100% 2% 75% CO 114% CA 34% WV 30% VA MD 10% 24% KS MO KY 7% n/a DC 1% 129% 54% n/a NC 91% TN 59% CHANGE IN PREMIUMS AZ OK 157% NM AR 80% 58% 171% SC FOR 27 YEAR OLDS 20% Up 100%+ MS AL GA 31% 31% 168% Up 51% to 100% TX Up 0% 50% LA 100% 106% Down 1% to 30% AK 73% FL Notes: Data for KY, HI, and MA 75% unavailable at time of analysis. VA figure not available due to HI n/a possible errors. Source: Heritage Foundation calculations using data from healthcare.gov and state-run exchanges, October 2013.

Premiums are higher in Obamacare exchanges: Age 50 Buying individual health insurance in the exchanges is generally more expensive than it was before Obamacare. In 13 states, 50 year olds will see premiums rise by 50 percent or more. WA VT NH 13% 61% 5% MT ME ND 31% 4% OR 96% 7% MN ID 23% MA n/a 34% SD WI NY WY 73% 64% 29% RI 16% MI 15% 43% CT 75% PA NV IA NE 29% NJ 1% 50% 13% UT 22% IL OH IN DE 65% 2% 26% CO 43% CA 81% WV 26% VA MD 13% 13% KS MO KY 9% n/a DC 53% 72% 39% n/a NC 21% TN 32% CHANGE IN PREMIUMS AZ OK 42% NM AR 12% 22% 79% SC FOR 50 YEAR OLDS 33% Up 50%+ MS AL GA 37% 29% 71% Up 26% to 50% TX Up 0% 25% LA 91% 44% Down 1% to 30% AK 46% FL Notes: Data for KY, HI, and MA 75% unavailable at time of analysis. VA figure not available due to HI n/a possible errors. Source: Heritage Foundation calculations using data from healthcare.gov and state-run exchanges, October 2013.

Premiums are higher in Obamacare exchanges: Family of four Buying individual health insurance in the exchanges is generally more expensive than it was before Obamacare. In 19 states, premiums for a family of four will increase by more than 10 percent. WA VT NH 3% 18% 1.3% MT ME ND 8% 0.9% OR 32% 2% MN ID 6% MA n/a 9% SD WI NY WY 22% 19% 7% RI 4% MI 4% 12% CT 23% PA NV IA NE 8% NJ 0.3% 0.8% 7% UT 6% IL OH IN DE 19% 0.4% 7% CO 12% CA 26% WV 6% VA MD 3% 3% KS MO KY 2% n/a DC 15% 22% 11% n/a NC 5% TN 9% CHANGE IN PREMIUMS AZ OK 12% NM AR 3% 6% 25% SC FOR A FAMILY OF FOUR 9% Up 21%+ MS AL GA 10% 8% 21% Up 11% to 20% TX Up 0% 10% LA 30% 12% Down 1% to 10% AK 13% FL Notes: Data for KY, HI, and MA 23% unavailable at time of analysis. VA figure not available due to HI n/a possible errors. Source: Heritage Foundation calculations using data from healthcare.gov and state-run exchanges, October 2013.

Many Obamacare exchange plans come with higher deductibles In addition to premium costs, individuals must meet an annual deductible before coverage kicks in. Average individual deductibles in the 36 states with a federally run exchange are much higher than the average individual deductible for employersponsored plans in 2013. $6,346 $4,617 $2,756 $1,203 AVERAGE DEDUCTIBLE $1,135 Note: Those with incomes between 100% and 250% of FPL who purchase silver plans qualify for a separate cost-sharing reduction subsidy that reduces their deductible and other out-of-pocket expenses. Catastrophic Bronze Silver (Standard) $390 Gold Platinum Employersponsored insurance Sources: Heritage Foundation calculations based on data from HHS and Kaiser Family Foundation Employer Health Benefits 2013 Annual Survey.

Lack of competition in Obamacare exchanges More than half of U.S. counties have only one or two insurance carriers selling coverage in the Obamacare exchanges. This lack of competition means less choice for consumers and less market pressure to keep prices down. COUNTIES WITH LITTLE OR NO COMPETITION IN OBAMACARE EXCHANGES (% OF ALL COUNTIES) Only 1 carrier (17%) Only 2 carriers (35%) Sources: Heritage Foundation calculations using data from healthcare.gov and state-run exchanges, November 2013.

Obamacare s new spending continues to grow Initial estimates for Obamacare s spending on the Medicaid expansion and exchange subsidies counted only six years of spending. A full 10 year cost reveals nearly $2 trillion in new spending by 2024. $898 billion $2 trillion March 2010 estimate (six years of spending over 10 years) February 2014 estimate (10 years of spending over 10 years) Source: Congressional Budget Office, March 2010 and February 2014.

Obamacare s Medicaid expansion burdens state budgets In the vast majority of states, adopting the Medicaid expansion would require additional state spending. WA VT NH $547 $134 $42 MT ME ND $57 $332 OR $55 $343 MN ID $724 MA $923 $61 SD WI NY WY $61 $843 $7,694 RI $107 MI $22 $883 CT $335 NV NE IA PA $1,374 NJ $5 $138 $157 $287 UT IL OH IN $1,194 DE $164 $231 CO $2,338 CA $444 WV $156 VA MD $289 $9,011 KS MO KY $176 $284 $85 DC $119 $515 $370 NC AZ TN $777 $891 OK $2,805 NM AR $331 $319 $364 SC $820 ESTIMATED STATE COSTS MS FOR MEDICAID EXPANSION, $312 AL GA $368 $583 2014 2022 (MILLIONS) TX $1,402 LA $30 $99 AK $685 $100 $499 $63 $500 $999 U.S. total: FL $1,000 $1,999 HI $326 $41.9 billion $1,389 $2,000 $9,100 Sources: Heritage Foundation calculations based on data from the Congressional Budget Office, March 2012, and Medicaid and CHIP Payment Access Commission.

Millions will remain uninsured under Obamacare In 2024, after 10 years of full implementation and nearly $2 trillion in new spending, 31 million people will likely remain uninsured. Those who do gain coverage will do so primarily through Obamacare exchanges or Medicaid. HEALTH COVERAGE IN 2024, WITH AND WITHOUT OBAMACARE UNINSURED 56 MEDICAID OBAMACARE EXCHANGES million DOWN 47 25 UP 13 million million million 34 31 million million 24 million UP 24 million n/a Note: Figures have been rounded. Without Obamacare With Obamacare Without Obamacare With Obamacare Without Obamacare With Obamacare Source: Congressional Budget Office, February 2014.

Obamacare s 18 new taxes and penalties Obamacare includes 18 new taxes, fees, and penalties, costing taxpayers an estimated $771 billion by 2022. OBAMACARE TAXES IN BILLIONS OF NOMINAL DOLLARS $120 $100 $80 $60 $40 All other taxes Fee on medical device manufacturers Fee on pharmaceutical companies Tax on Cadillac plans Health insurance tax Individual and employer mandates $20 $0 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Increase in Medicare payroll tax and application to investment income for high earners Note: The total amount of tax revenue collected from the individual mandate, employer mandate (excluding collections in 2015 because of the July 2013 delay), and 40 percent excise tax on high-cost health plans are from the CBO s May 2013 estimates. For the remaining taxes, the revenue projections are from the Joint Committee on Taxation s 2012 estimates. Sources: Heritage Foundation calculations based on data from Congressional Budget Office, May 2013, and Joint Committee on Taxation, June 2012.

Who pays the Obamacare individual mandate tax? Nearly 70 percent of those projected to pay the Obamacare individual mandate tax earn less than 400 percent of the federal poverty level (FPL) ($45,960 for a single individual in 2013), and 10 percent live in poverty. BELOW 400% FPL 69% 300% 400% FPL 18% 200% 300% FPL 20% ABOVE 400% FPL 31% 75% 50% 100% 200% FPL 21% More Than 500% FPL 20% 25% Below Poverty Line 10% 400% 500% FPL 11% 0% Source: Congressional Budget Office, June 2012.

Obamacare cuts Medicare payments to fund other new programs Projected Medicare savings from Obamacare do not improve the program s long-term solvency. Most of the savings are redirected to fund new Obamacare spending. CUTS IN MEDICARE DUE TO OBAMACARE, 2013 2022 Hospital services Payment rates in Medicare Advantage DSH* payments, other Medicare provisions Home health services Skilled nursing services All other services $156 billion $145 billion $66 billion $39 billion $33 billion $260 billion Obamacare cuts $716 billion from Medicare Hospice services $17 billion $0 $50 $100 $150 $200 $250 billion * Disproportionate Share Hospital, meaning supplemental payments that go to hospitals that serve a large number of low-income patients. Source: Congressional Budget Office, July 2012.

Obamacare s Medicare cuts will result in severe access problems for seniors By cutting Medicare payments instead of introducing real reform, the health care law jeopardizes seniors access to providers. According to the Medicare trustees, Obamacare s scheduled reductions to provider payments will cause Medicare s payments for health services to fall further below providers costs. This will cause providers to either withdraw from serving Medicare beneficiaries or shift more costs to their patients with private coverage. PERCENTAGE OF HOSPITALS, SKILLED NURSING FACILITIES, AND HOME HEALTH AGENCIES PROJECTED TO OPERATE AT A LOSS 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% 15% 25% 40% 2019 2030 2050 Source: Medicare trustees 2013 report.

Obamacare remains unpopular Opposition to Obamacare has hovered around 50 percent since early 2010. Over the past year, the law has grown even more unpopular. POLL AVERAGE, BY MONTH 60% AGAINST/OPPOSE 50% FOR/FAVOR 40% 30% Jan. 2010 Jan. 2011 Jan. 2012 Jan. 2013 Jan. 2014 Note: Figures shown are the first poll average in each month. Source: Real Clear Politics, Public Approval of Health Care Law, March 2014.