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TheStreet Open House

Morici: Hardly Time to Call Obamacare a Success

NEW YORK (TheStreet) -- With 8 million Americans enrolled in health insurance through federal and state exchanges, President Obama has declared the Affordable Care Act a success. That's disingenuous, and big changes are needed to make the law work well.

The ACA's goals were to provide reasonably priced medical care to the 45 to 50 million people who had been uninsured and slow health care cost increases. It is hardly clear those goals will be accomplished.

The rollout of the exchanges to provide market coverage to individuals was botched. Scarcely a surprise, the Department of Health and Human Services and state agencies could not replace the millions of private decisions facilitated by free markets with computer software.

When the Web sites failed, public focus shifted from measuring ACA performance against its original objectives, and with the Web sites now functioning, the ACA should be evaluated against its original objectives.

Many of the 8 million enrolled to replace individual and small business policies, canceled thanks to ACA rules, or to obtain federal subsidies available only through the exchanges.

Expanded eligibility rules permit Medicaid to cover additional millions in the 25 states. In other states, legislatures have declined to participate, in part because of concern the federal government will not cover 90% of the cost long term as stipulated under Obamacare.

It remains to be seen how many Americans will remain uninsured because of Washington's lack of credibility in many state capitals and the program's inability to control costs enough to permit most employers to keep offering coverage.

The ACA requires health insurance policies to pay for a wider and more expensive scope of services than many individual and small business policies covered prior to the law. In many counties, only a few insurers chose to offer policies on exchanges. Absent competition, insurers lacked incentives to bargain as hard as before with hospitals and other providers, further raising premiums and out-of-pocket costs.

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