Affordable Care Act : A New Insurance Market Essay

Affordable Care Act : A New Insurance Market Essay

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Affordable Care Act
In October 2013, the Affordable Care Act introduced a new insurance market. It created state and federal exchanges where people can purchase health insurance for themselves or their families. The current state of the American health care can be described in several terms. In terms of rising cost and spending, healthcare is adding pressure on the economy. In terms of the healthcare insurance system, it is becoming more complex and it increasingly shifts more and more burden to the individuals (Chen, 2014). Though this new way of buying insurance was written as law, few were quick to participate in the exchanges. This Act was intended to bring affordable healthcare to all who currently had insurance, as well as those who could not afford to buy health insurance. From a macroeconomic perspective, the organization of this new law brought about complex ideas of price ceiling as well as supply manipulation and artificially required demand. In fact, there is nothing about this legislation that appears to be written by persons knowledgeable in the macroeconomic impact of markets. It is first necessary to look at the simple principles of supply and demand and discuss how they relate to healthcare insurance as we know it today.
Supply and demand are the basic principles of how open markets work. The idea of supply and demand had its beginnings in its simplest concepts of prehistoric man trading sea shells for other goods. These ideas have grown into a field of study in itself. So, taking supply and demand into consideration, how has the market changed for health insurance? First, it is important to understand that the insurance industry was an open market that had competition between insurance companies that dr...

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...ts the market. The idea of a price subsidy for some and a requirement that all must participate sounds like socialism of our healthcare system. Future research should focus on the anomaly that most people view socialism with great disdain, but not when it comes to health care (Testa, 2013). Condemning the legislation does not imply support for the system we had before. The administration was correct in its acknowledgements that costs were too high and too many people were left uninsured. But with regard to the new law, not only do the negative consequences far outweigh the benefits, the new initiative goes in the very opposite direction from what was needed. If our house is to be set in order as far as health care is concerned, it is the contention of the present paper that we have to move in the direction of capitalism, not further away from it as this new law does.

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