Some people love the Patient Protection and Affordable Care Act of 2010 (PPACA) the way a mama hippopotamus loves a baby hippo.
Some people view PPACA, and especially the provision that’s supposed to require most individuals to have health coverage, as an attack on civil liberties.
Some on both sides, and in the middle, are curious about what exactly the mandate might do to lower or increase prices.
Matthew Buettgens and Caitlin Carroll try to answer that question in a new PPACA individual mandate paper distributed by the Robert Wood Johnson Foundation, Princeton, N.J.
The foundation is the kind of foundation that generally supports PPACA, and the Urban Institute also a PPACA-friendly kind of place, but the researchers have tried to show their work and explain how they came up with their numbers.
The researchers estimate that the average premium per covered life would have been about $5,100 in 2011 if all PPACA health insurance access rules had been in effect, along with the PPACA individual health insurance ownership mandate.
If PPACA had been in effect with no mandate, and consumer use of the new health insurance exchanges and subsidies was low, the average could have been 20% higher, or about $6,100 per month, the researchers estimate.
The researchers do not say what they think the coverage premium per covered life actually was, without PPACA, but they estimate elsewhere in the report that total costs for employers and individuals will be about 2.5% with PPACA, including the mandate, than the costs would be without PPACA
The researchers say the results of their simulations show that predicting how PPACA might work is complicated and will depend on how various PPACA features work together.
“The current nongroup market in New York, which is guaranteed issue and pure community rated, but does not have an individual mandate is cited as a doomsday example of what could happen,” the researchers write. “This market has an enrollment of less than 40,000 and premiums around $1,200 a month. However, New York does not have the provision under [PPACA] that provides subsidized coverage in the exchanges.”
The researchers say they’ve shown in an earlier paper that strong use of the exchanges and subsidies could help, even if the PPACA health insurance access rules took effect without a mandate, but, they say, how well the exchanges and subsidies will work will depend on the effectiveness of implementation and outreach.
The U.S. Supreme Court is considering suits filed by states and other parties that contend that the PPACA individual coverage ownership mandate is constitutional.
If PPACA takes effect on schedule and works as drafters expect, it’s supposed to require carriers to sell coverage on a guaranteed-issue, mostly community-rated basis starting in 2014.