On Monday, Politico came out with a story about how Speaker John Boehner and his wife were going to have to pay higher costs as a result of the Affordable Care Act. It’s worth taking a minute to think through why that is and what, if anything, the Speaker’s situation tells us about the ACA as a whole. (Short answer: not much.)
First, let’s not forget the requirement that members of Congress and certain Hill staffers transition out of the Federal Employee Health Benefit Plan (FEHBP) and into the ACA Marketplaces was a Republican amendment. Secondly, the reason Speaker Boehner’s premiums are going up is that the FEHBP is community rated (as is typical for employer-sponsored insurance) while the ACA allows insurers to charge older enrollees three times as much as younger enrollees (a 3:1 “age band”). Since Mr. Boehner is in the oldest eligible age group (pre-Medicare), he is feeling the effect of this age rating.
According to the Speaker’s office, the Boehners’ situation is emblematic of problems with the ACA, but nothing could be farther from the truth. Members of Congress are in an unusual situation. Most employees who have ESI do not pay higher premiums based on their age. The fact that older federal employees are being forced to pay more is really a function of the refusal of Congressional ACA opponents to allow any fixes to the law such as allowing FEHBP to make age-adjusted payments in order to protect older employees.
Most adults in the their 50s and 60s who shop on the Marketplaces will find that the same 3:1 age band policy that is pushing Speaker Boehner’s premiums up will be holding theirs down. Moreover, since older adults are more likely to have a pre-existing medical condition or to incur significant medical expenses during the year, the ACA’s insurance market reforms and out-of-pocket limits will benefit them even if they don’t qualify for premium tax credits. Repealing the ACA, as Mr. Boehner remains intent on doing, would leave these people paying higher premiums for inadequate coverage.
Although the Speaker’s situation doesn’t tell us anything about how the ACA will affect most people, it does tell us something about the ACA’s critics, who appear to be willing to attack the law both for compressing rates too much and not enough. While that may seem illogical, it does have its own kind of (twisted) consistency.