EDITORIAL: Repair the Obamacare exchanges

Oct. 28--Donald Trump and fellow Republicans pounced when the federal government announced this week that premiums under the Affordable Care Act will increase an average 25 percent next year. The repeal-and-replace crowd returned to center stage, though, again, without a workable alternative. What they get right is that the act requires repairs, something about which Hillary Clinton readily agrees, the Democratic presidential candidate even with ideas about how to do so.

The projected increase was expected in many quarters, though the size varies across the country, Ohio expected to see a rise of 2 percent. The upward trend goes to catching up, the increases of the past two years, 2 percent and 7 percent, reflecting support the government provided to insurers as a cushion against uncertainty and flux as the insurance exchanges first took shape.

That isn't to diminish the problems. They are real and substantial, as indicated by the withdrawal of major insurers such as Aetna from Ohio and other states. (Ohio will have 11 insurers participating next year, down from 16.) At one point, the Congressional Budget Office projected that as many as 22 million people would purchase polices on the exchanges. The number actually is 10.5 million, and those staying away tend to be healthier, leaving insurers with the more expensive proposition of covering a sicker population.

Recall why the insurance exchanges were created. Most Americans are covered through their employers. Many others benefit from Medicare and Medicaid. A much smaller share must purchase insurance on their own. Yet, before the Affordable Care Act, many in this group found the policies too costly or lacking decent coverage. They chose to go without coverage and thus contributed heavily to the high rate of uninsured.

The Affordable Care Act is an attempt to make this private market work better for consumers. It helps with the cost for 85 percent of those in the exchanges. It guarantees a minimum level of benefits. Unfortunately, experience teaches that, even as the subsidies increase to match higher premiums, the subsidies still are inadequate, many above the poverty line unable to afford coverage.

So, yes, the subsidies must be redesigned to meet the reality. More, healthier people must have greater incentive to purchase policies. That could be achieved through a stronger individual mandate, adding to the penalty for failing to buy, though this seems a political nonstarter. Better would be ways to revamp the benefits package to appeal to younger people.

The moment also is ripe for Congress to revive an idea rejected six years ago -- the public option. Such a choice would help to maintain competition and restrain prices, especially in view of counties in Ohio and elsewhere with just one insurer offering coverage.

For all the criticism hurled at the Affordable Care Act, it remains a work in progress at middle ground, between the dysfunctional market of the past and a single-payer system. Thus, politically speaking, there is a strong case for making the necessary fixes to preserve the exchanges, a melding of markets and guarantees.

Remember, Republicans once embraced the individual mandate and the exchanges. Perhaps they would be willing to join a new Clinton administration in making them work better.

To see a summary of the Beacon Journal recommendations for the Nov. 8 election, go to http://www.ohio.com/editorial/endorsements.

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