Hoover Daily Report

Voters on ObamaCare: Informed and Opposed

via Wall Street Journal
Friday, October 15, 2010

The Obama administration has tried to convince Americans that they will like the new health law once they understand its effects. According to a new poll, they understand the law pretty well—and they don't like what they see.

At the end of last month, we asked a sample of 1,000 adults about health reform. The big picture: A majority (55%) believe the new law will cause them to get lower-quality care, pay more in insurance premiums or taxes, or both. Consistent with other surveys, 42% favor repeal, 36% don't, and 22% aren't sure.

Our poll also asked about specific provisions. The mandate that individuals buy insurance or face a tax penalty generated the greatest opposition, with 55% opposed and only 25% in favor. Other aspects of the law received more mixed reviews. The provision requiring employers to offer their employees health insurance or pay a tax penalty had plurality support, with 47% in favor and 36% opposed.

On the surface, these findings might seem to support the administration's view. People are less negative about some of the specifics than they are about the package as a whole. But does this imply that those who understand the law like it better?

To investigate, we asked people about their perceptions of the link between reform, insurance premiums, and wages—in particular, "if employer insurance costs increase as a result of the health reform plan, do you think the take-home pay of employees will decrease or not?" Policy analysts on the left and the right agree that workers bear the costs of insurance through wage offsets; numerous empirical studies have found this to be true. We therefore used people's answer to this question as a proxy for their understanding of the effects of health reform.

Fully 49% answered the question correctly, saying that employee pay would decrease by approximately any additional amount that employers have to spend. Thirty-one percent believe employee pay would decrease but by less than the full amount; 19% believe the extra costs would have no effect on pay.

People who understand the economic consequences of health reform span the political spectrum. Although these respondents were somewhat more likely to identify themselves as Republicans than the overall population (37% versus 28%), fully 25% identified themselves as Democrats (versus 34% in the population), and 29% as independents (versus 28% in the population).

Despite their political views, the well-informed share a strong opposition to the new law. They advocate repeal 56/25; oppose the individual mandate 73/13; and oppose the employer mandate 52/36. Such numbers do not bode well for the administration's claims that to know reform is to like it.

We also asked about three other provisions in the law: the ban on charging more for insurance based on a person's health ("community rating"), the mandate that employers cover "children" up to age 26, and the ban on lifetime limits on benefits. We told people that these provisions would increase insurance costs by $700, $200, and $100 per year, respectively—approximately what health economists and actuaries have estimated as the added cost to an average employer-sponsored family insurance policy.

People who thought they could enjoy these benefits while someone else picked up the tab generally supported them. Those who believed that there is no "free lunch" opposed community rating (by 43% to 32%) and mandated coverage of children to age 26 (by 48% to 32%). However, they supported the new law's ban on lifetime limits on benefits by 43% to 33%. These responses are consistent with a poll we conducted in January 2009, published in Health Affairs, which found widespread political support for a more moderate package of reforms.

As the midterm elections approach, one can expect candidates opposed to the new health reform law to point out how its effects on health costs will translate into people's paychecks. Our poll suggests this message will resonate with voters of all stripes.

Mr. Brady is professor of political science at Stanford University and deputy director of the Hoover Institution. Mr. Kessler is professor of business and law at Stanford and a senior fellow at the Hoover Institution. Mr. Rivers is professor of political science at Stanford, senior fellow at the Hoover Institution, and president of YouGov Polimetrix.