By Kevin O’Brien, Ph.D.

The Affordable Care Act (ACA) or “Obamacare” has been mired in controversy since the law was first proposed in 2008. It took two years of legislative drama before the 1,000-page bill was passed by Congress and signed by President Obama in 2010.

The ACA is a complex law whose features are not well-understood by the American public. The basic idea behind the program is the concept of the “three-legged stool.” The first leg includes those provisions people generally like even if they say they oppose something called Obamacare. This leg consists of no lifetime limits on medical expenses, no exclusion of people with pre-existing medical conditions and no higher premiums for people with these medical conditions. However, these regulations lead to the next stool. If you make insurance companies follow these rules, they cannot deny sick people or even charge them more. The concern is that the healthy will game the system by not buying insurance until they become sick. With only sick people buying insurance, premiums will rise and rise until insurance companies will collapse in a “death spiral.”

So the second leg of the stool is the individual mandate which requires (almost) everyone, including the healthy, to buy health insurance. This leg then requires the third leg. If you require everyone to buy insurance, can they afford it? The answer is no so you have to make insurance affordable. The third leg consists of government subsidies based on a person’s income and these subsidies make health insurance affordable for everyone who must buy health insurance. Just like a stool, the ACA needs all three of these legs to stand up. There was also one other provision to provide health care for the poorest Americans. This provision expanded Medicaid eligibility to incomes up to 133 percent of the poverty line and the Federal government would pay for costs of this expansion.

How has the law worked so far? The law has had a long timeline and it was only last year that the major coverage provisions started. So far the law has worked quite well. According to Gallup, the percentage of those uninsured fell from 18 percent of the population to 13 percent of the population. This means approximately 8-11 million people received health care coverage who were uninsured before. Of these newly covered, half were covered by the expansion of Medicaid and half were covered under the new health insurance exchanges. These exchanges were implemented under Obamacare and these are where consumers actually purchase their choice of a health plan.

The increase in health insurance premiums has been modest so far. More interestingly, since the passage of Obamacare, there has been a slowdown in healthcare spending. Between 1990 and 2008, increases in health care spending were on average 7.2 percent annually. In 2013, health care spending only increased 3.6 percent which was smallest rise since these numbers have been recorded. While Obamacare cannot take credit for all this slowdown, it can take credit for some of it.

Have there been problems with Obamacare? Yes. Last year’s rollout of the website for purchasing health care plans was terrible. Some people did lose their existing health plans though many of these plans had poor coverage. Some people had to change providers since they changed health plans and some did see premium increases. Some 6.3 million people have not benefitted from the Medicaid expansion because their states refuse to participate in the expansion. However, any of the problems with Obamacare could be lessened or eliminated if politicians could cooperate in Washington. In fact, just the opposite is happening. Obamacare was and still is an incredibly politically polarizing law. Though Obamacare has benefitted millions, its future is still uncertain.

Kevin O’Brien is chairman of the economics department at Bradley University. His original research focused on public sector labor markets, specifically police and firefighter collective bargaining. He is currently researching municipal budget outcomes.