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| 3 Reasons Why Obamacare Is So Hard To Fix | |
| 2026-03-08 | |
Sweeping changes ushered in by the Affordable Care Act, the law creating Obamacare, all but guaranteed that premiums would increase—which they did by 23 percent in the program’s first year. Even so, public opinion swung in favor of Obamacare starting in 2017 and remains positive, according to KFF Health Tracking polls. More than 24 million people were insured through the program by 2025. And insurers learned to thrive under the new rules, more than doubling annual revenue to $1.1 trillion and consistently generating a profit between 2014 and 2024. Problems do persist, however. Premiums have more than doubled over 12 years. Some consumers have only a few plans to choose from. And flaws in the program’s design continue to waste taxpayer dollars. Lawmakers on both sides of the aisle have proposed solutions, many with bipartisan support. Yet permanent reform remains elusive. The reason may have less to do with the ideas themselves and more to do with the most persistent disagreement between Republicans and Democrats: the role of the federal government. Here are three commonly proposed remedies for problems within Obamacare, and why those problems remain. 1. Increase Plan Options Of the more than 1,100 health insurers doing business in the United States, about 10, on average, offer plans through Obamacare in each state. About 5 percent of Obamacare users have only one or two insurers to choose from. 2. Empower Consumers Obamacare subsidizes health insurance for people earning between 100 percent and 400 percent of the federal poverty level. The subsidy comes in the form of an advanced tax credit. But the money is paid directly to insurance companies, not to the insured individuals. President Donald Trump and several others have proposed making those funds available to consumers, which they say would increase choice and lower prices. Trump’s plan, and some others, would provide funded Health Savings Accounts, which enrollees could use only for health expenses. That would include buying insurance, paying out-of-pocket expenses, or buying health care directly from providers. Scott made a similar proposal, as did Sens. Mike Crapo (R-Idaho) and Bill Cassidy (R-La.), and Sen. Roger Marshall (R-Kan.). “Giving billions of taxpayer dollars to insurers is not working to reduce health insurance premiums for patients,” Crapo said in a statement announcing his plan in December 2025. “We need to give Americans more control over their own health care decisions.” The Crapo–Cassidy plan failed to advance in the Senate last year. None of the other plans have even been put to a vote. Democrats have opposed the idea as a halfway measure that would undermine the value of Obamacare. Health Savings Accounts are available only with insurance plans that have a high deductible, leading some analysts to conclude that they wouldn’t benefit people who have the most trouble affording health care. 3. Fix Structural Problems One feature of Obamacare was intended to lower premium prices but produced the opposite result. Insurers must offer cost-sharing reductions to customers making less than 250 percent of the federal poverty level who choose a silver-level plan. The cost-sharing reductions mean lower copays and deductibles, which helps low-income enrollees. It also increases costs for insurers, so the federal government reimbursed them for the added expense. But a federal judge ruled that those reimbursements were improper because Congress had never authorized funds for them through an appropriations bill. Cost-sharing reduction payments to insurers were discontinued in 2017. However, insurers are still required to offer the cost-sharing reductions. To compensate, insurers raised premiums on the silver-level plans, a practice known as silver loading. THE IMPASSE The legislative impasse over improving Obamacare appears to arise from the basic difference in approach by Republicans and Democrats to health care financing. Republicans generally favor deregulation and other marketplace reforms that they believe will increase competition and lower prices. “As President Trump has said, he will make our health care system better by increasing transparency, promoting choice and competition, and expanding access to new affordable health care and insurance options,” White House press secretary Karoline Leavitt told The Poynter Institute in 2024. Republican proposals for Obamacare generally follow that blueprint: add choices, improve competition, and allow the market to lower prices. Democrats generally favor increased government intervention in the form of regulation and subsidization with the goal of ensuring access to health care services for everyone. “Access to high-quality health care should be a right available to every single American,” House Democratic Leader Hakeem Jeffries (D-N.Y.) said in December 2025. “One of the ways we can make sure that we strive to achieve that principle is to extend the Affordable Care Act tax credits.” Democrat-led bills to extend those credits failed to advance in both the House and Senate. Republican proposals to increase choice and competition also failed to advance. Obamacare’s benchmark silver plan premiums for 2026 increased by about 26 percent. | |
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