Affordable Care Act: The Heritage-Born Mandate That Fell to Zero Dollars

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In the 2008 primaries, Barack Obama argued against an individual mandate while Hillary Clinton argued universal coverage needed one, yet the mandate became the centerpiece of the 2010 Patient Protection and Affordable Care Act, the largest health overhaul since Medicare and Medicaid in 1965. Budget director Peter Orszag drew on Dartmouth research showing that regions with far higher Medicare spending had no better outcomes. The law guaranteed issue regardless of pre-existing conditions, let young adults stay on parents' plans to 26, banned annual and lifetime caps, required ten essential health benefits, and covered preventive care with no copays. To prevent an insurance death spiral, it required nearly everyone to buy coverage, with exchange subsidies for incomes between 100 and 400 percent of the poverty level.

The mandate traced to a 1989 Heritage Foundation proposal, a 1993 Republican bill and Mitt Romney's 2006 Massachusetts plan, which covered 98 percent of residents. Critics coined Obamacare, and Obama embraced it by 2012. The death panels claim grew from a House draft that would have paid for voluntary end of life planning visits. In NFIB v. Sebelius in 2012, the Supreme Court upheld the mandate as a tax but let states refuse Medicaid expansion, leaving the poorest residents of states that opted out in a coverage gap. By 2016 the law had roughly halved the uninsured rate, and the 2017 Tax Cuts and Jobs Act cut the mandate penalty to zero starting in 2019 without causing a market collapse.

• Bronze, silver, gold and platinum tiers reflect actuarial value of about 60, 70, 80 and 90 percent, not quality of care.
• The original subsidy cliff at 400 percent of poverty was a compromise to keep the bill's cost score down.
• The Senate Finance Committee dropped the end of life consultation provision to end the confusion.
• Roughly 8 million undocumented immigrants were excluded from the exchanges, subsidies and Medicaid.
• The law reached majority support in 2017, when full repeal became a real possibility.