The Affordable Care Act (ACA) was one of the most controversial pieces of legislation in the history of the United States, and many states' residents were strongly against the ACA being passed into law. In Utah, many residents and businesses complained about the bill, saying how they wouldn't participate with the law, and therefore most experts assumed that Utahns weren't going to sign up for the ACA in large numbers. However, what actually happened in Utah was shocking, and would set a precedent for the rest of the nation. As soon as the marketplace opened for the ACA, residents of Utah showed up in large groups, flooded the website, and began to sign up for coverage. Because of this trend, experts are predicting that thousands upon thousands of other uninsured Utahns will end up enrolling in the ACA throughout 2015 and get insurance coverage.
Breaking the ACA Down
In its first year of operation, 85,000 people from Utah signed up for the ACA, which is roughly 30,000 more than predicted. According to Jason Stevenson, the education and communication director for the Utah Health Policy Report, no one expected such an outcome. “We weren't sure there would be a demand for this in Utah,” he said. “But demand was huge.” However, officials in Utah should have seen the writing on the wall. In the nation at large, the national average for people holding insurance via group insurance with an employer is just under 50%. In Utah, it's over 60%. In hindsight, it is rather clear that Utahns like their health coverage.
But then there's the curve ball that Utah is dealing with, as in the type of person who signed up for the ACA. Nationwide, the consensus was that it would be older people and those with pre-existing conditions signing up in droves. And while Utah did have its fair share of those, most of the people who signed up in the state were younger people. This is who comprised the bulk of new enrollees to the ACA. Most of these younger people were hard-working individuals who simply didn't quality for group-based insurance under an employer due to their line of work. This was really driven home by the enrollment numbers in Daybreak, which is an area in Utah comprised almost entirely of younger working families.
One of the more controversial parts of the ACA was that people under the age of 26 could stay insured on their parents' plans. In Utah, many young adults took full advantage of this, and their parents didn't seem to mind. That was another big chunk of those who signed up, people looking to keep their children covered well into their 20s.
The ACA hasn't affected the insurance rates in Utah quite as much as many predicted. Although the rates are up about an average of 5.3%, Utah is actually still one of the ten lowest states in the nation in terms of health care costs, according to Kaiser Health. The cheapest rates are for those in their 20s and early 30s in good health, of course, with rates going up after that point and depending on health.
Another reason that so many Utahns actually went with ACA coverage is that it's partially subsidized for families whose income is within 400% of the federal poverty level. It's not a huge subsidy, typically around $50 or so, but it definitely helps pay the monthly premium.
Where Insurance Companies Stand
The ACA is insurance that's provided by the government, of course, so every person signing up with the ACA is a person not signing up with an insurance company. In Utah, with thousands more expected to enroll by the end of 2015, what does this mean for insurance companies in the state? The jury is still out, as there's no way to really foresee how that market can fluctuate. But just speculating, it appears as if private companies are fairly firm in their position. They're still providing group-based insurance through employers to millions of people, and they're still covering wealthier individuals who want a better insurance policy than what the ACA can provide. So while private industry has taken a hit, it's far from a crippling blow.
Larger insurance companies are still reporting profits. For the rest, it's simply too early to say where they stand; and if any are struggling, it's too early to tell if they can recover or not.
Improving Utah's Insurance
According to Shaun Greene, founder of COO of Arches, which is a nonprofit insurance company, there's still a lot of room to grow in Utah in terms of affordable insurance. Unfortunately, around 65,000 Utahns fall into the “black hole” of insurance, as Greene puts it, which means that they're out of reach to quality for the ACA, yet cannot afford a traditional package. So while the ACA has helped to stabilize the economy in some regards, there are still thousands upon thousands of people for whom the ACA isn't doing any good, and in fact may end up hurting them if rates keep climbing higher.
Greene also complains that the ACA did little to nothing to actually bring the costs of health care down. While more people are insurance, more people are still paying more money for that coverage. Without payment reform, Greene warns, health care costs will continue to steeply rise.
A Silver Lining For All
According to Jason Stevenson, the ACA may have a side effect of helping to address what he calls “Job lock.” Because of the previous unwillingness of insurance companies to take on new customers with existing conditions and other issues, there was a barrier created that really tamped down the entrepreneurial spirit. Fewer people were branching out to innovate and start their own companies because they couldn't get coverage to be protected. One side effect of the ACA is that now these people can get coverage, and now they can pursue their entrepreneurial dreams.
As Stevenson puts it, “Job lock has been erased” and the ACA could actually help boost Utah's economy to heights it hasn't seen in decades.
