BARACK OBAMA used 22 pens to sign the Affordable Care Act (ACA) on March 23rd 2010; some were used for just part of a letter in his signature. The pens were given to people who helped pass the law through lengthy debates in Congress (Republicans were not big fans of increased spending).
Implementing the law has been even more challenging. The legislation was the biggest overhaul to American health care since 1965, when Medicare (which provides government insurance for the elderly and the disabled) and Medicaid (which does the same for low-income Americans) were created.
Obamacare extended Medicaid to cover more Americans; built insurance exchanges for easier comparison and purchase of private plans; and created subsidies for these plans. It required almost all Americans to purchase health insurance; banned insurers from removing the sick from their rolls; and allowed young people to stay on plans of their parents until the age of 26.
Some parts of the law are still being challenged in the Supreme Court. And some subsidies and funding hang in the balance. Our six charts below show Obamacare’s impact on American health care.
Start with the obvious: the rollout of Obamacare has reduced the rate of uninsured Americans (see chart 1). Only 8% of Americans were without coverage in 2023—half the rate before the law was signed.
But that is still above what Mr Obama had planned. The law originally required almost all Americans to get health insurance, or face a fine equal to 2.5% of their income. Young and healthy Americans had been the most likely to avoid health insurance, which pushed up the cost for those most likely to use their plans. After repeated legal challenges, Republicans ultimately reduced the fine to $0 in 2017, making the requirement void. However, that change did not cause the uninsured rate to spike. With subsidies and expanded coverage, Americans continued to enroll.
Obamacare expanded Medicaid to cover more people in 2014—up to those with incomes up to 138% of the federal poverty line (about $21,000 in 2024). The architects of the plan wanted this to be a nationwide change, but the Supreme Court ruled that since the programme was jointly run with the states, they could not be forced to join in.
The federal government covered 90% of the cost for the additional coverage; 28 states signed up in the first year (see chart 2). Expansion stalled because of opposition in Republican-led states. Recently, however, the hold-outs have started to give in. Divided state governments in Virginia and North Carolina approved the expansion in 2019 and 2023, respectively. Seven states have extended coverage through ballot measures, including deep-red Idaho, Oklahoma and Missouri. (Some big Republican-led states—such as Florida and Texas—remain notable holdouts.)
Coverage from private-insurance exchanges began in 2014 (although they initially faced significant technical problems). The subsidies for private insurance were extended to more Americans during the covid-19 pandemic. Enrolments increased by 78% and premiums fell by an average of 44% between 2020 and 2024 (see chart 3). This has not come cheap: the subsidies now cost the federal government $140bn a year.
These pandemic-era subsidies are set to expire in December 2025. There is little talk of saving them in the Republican-led Congress. The Congressional Budget Office (CBO), a non-partisan scorekeeper, estimates that maintaining these subsidies would cost about $335bn over the next ten years. Without them, however, 4m people will probably be unable to afford their coverage.
Republicans in Congress have proposed slashing Medicaid by at least $880bn over ten years in order to fund their agenda, which includes $4.5trn in tax-cut extensions. This could affect the country’s mortality rates. Studies have shown improved health outcomes in states that expanded access to Medicaid under the ACA. One study published in 2023 by Angela Wyse and Bruce Meyer, then both at the University of Chicago, found that the expansion saved 27,400 lives by 2022 (see chart 4). They reckon that if every state had expanded Medicaid in 2014, another 12,800 lives could have been saved.
Within two years of Medicaid’s expansion, studies found improved credit scores among newly eligible recipients, and fewer evictions and bankruptcies. “The financial impacts are as strong as anything that came out of the law,” says Thomas Buchmeller, who worked on the implementation of Obamacare at the White House.
Yet government and consumer spending on health care continues to rise (see chart 5). Around 8% of all Americans now say that they have delayed or gone without medical care because of cost. As the baby-boomer generation ages, health spending will only increase. John McDonough, who helped write the ACA as a Senate staffer, says that while subsidised health insurance allowed more people to afford health care, it did little to bring down the actual cost of drugs and doctor visits. Obamacare hoped to reduce these costs by reimbursing hospitals and clinics for meeting various targets, instead of paying fees for services. “This was the big promised land,” sighs Mr McDonough. “It was not achieved in any way close to the grand expectations for it.”
Despite the setbacks, most Americans now have a favourable view of Obamacare (see chart 6). Polling showed that favourability increased after Republicans tried to repeal it during Mr Trump’s first term: net support jumped from six percentage points in 2016 to 15 in 2020.
In his second term, Mr Trump has backed down from calls to eliminate Obamacare altogether. ■