How the 2024 elections could impact health insurance coverage

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Embedded in the decisions voters in U.S. elections will make at the polls this year are several issues that could have lasting repercussions on the insurance industry, especially in the area of health care.

One of the areas that stands to potentially be affected is the Affordable Care Act (ACA).

Now approaching its 14th birthday, and according to numbers run by KFF, ACA is more popular than ever. KFF’s numbers show that in May, the ACA enjoyed a 59% favorability rating, compared with its low point of 33% in 2013.

Michael Giusti
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That popularity is translating into an increase in people signing up for Marketplace plans. In January, 21.3 million people signed up for Marketplace plans, 5 million more than last year’s record enrollments.

But that doesn’t mean the plan is immune from criticism. Donald Trump once again called for the program’s replacement as part of a stump speech – though leaders in Congress say there is no serious legislative push to do this.

The real question surrounding the trajectory of the Affordable Care Act is future of Medicaid expansion.

To date, there are only 10 states left who haven’t expanded Medicaid coverage. North Carolina was the latest to expand, which they did at the start of this year. However, industry observers say the remaining states aren’t likely to take the more traditional legislative approach if they do decide to expand Medicaid.

While some Republican-leaning states have had good luck with direct-to-constituent ballot initiatives, another likely route some may take is a hybrid approach, similar to what Arkansas did in 2022 by implementing a privatized expansion through its ARHOME program, rather than a true marketplace expansion. Alabama lawmakers recently floated just such an idea for a potential expansion in that ruby red state.

Another program that could reverberate through the elections is the future of the popular Medicare program. There is no doubt that Medicare is facing a tough fiscal reality.

It is controversial to say it is facing bankruptcy, but it certainly is facing insolvency by 2028 if nothing is done to shore up its health. It is just a demographic reality that there are more Baby Boomers leaving the work force, and not enough young people taking jobs to support Medicare’s growing rolls.

To address this, politicians have floated several plans.

The plan that seems to be tossed around the most right now is raising the eligibility age for Medicare. While that would certainly reduce the number of people covered by the plan, this suggestion is controversial for the people quickly approaching 65. Those nearing the current retirement age feel like raising the age just as they approach eligibility is akin to pulling their health care rug out from under them.

A hybrid suggestion often proposed is to leave the 65-year age in place for those about to retire, but signal to people in their 40s that the age will be higher when they are set to retire. Another option to shore up the program could be to leave the retirement age where it is at and instead work to reduce costs. Critics of Medicare Advantage contend making reforms there may cut costs, while others consider lowering payouts or limiting what is covered.

But in reality, there is no real political appetite for reducing benefits. Plus, reducing payouts would likely mean more doctors refuse to participate in the program in the first place.

It is always possible to simply ignore the problem and commit to propping up the costly program as it is though deficit spending. And there is also the option of increasing payroll taxes, which is an unpopular, though possible option.

Regardless of how the politicians approach Medicare, with the insolvency deadline rapidly approaching, the people who are voted into office this year will likely be playing a leading role in deciding how this scenario will play out.

Michael Giusti, MBA, is senior writer and analyst for InsuranceQuotes.com.