This is the Cato Daily Podcast for Tuesday, August 23rd, 2016.

I'm Caleb Brown.

With major insurers leaving Obamacare's exchanges have we finally hit the so-called death spiral of the Affordable Care Act.

Michael Cannon, Director of Health Policy Studies at the Cato Institute, discusses how the

act is stifled innovation and crippled private insurance markets.

What were Aetna's criticisms of the Affordable Care Act specifically before they decided

to withdraw from the exchanges? Well, before they decided to withdraw from the exchanges.

Well, before they decided to withdraw,

they didn't really have criticisms.

They were excited about participating in the exchanges.

And then they pointed out they were losing

hundreds of millions of dollars, and by by the way they have to back out.

There has been controversy over whether that was motivated by the fact that the Justice Department

refused to approve their merger with Humana, but I think that's overblown. What happened was the government

asked Aetna, if we refused to sign off on this merger, will it affect your participation in the Obamacare exchanges and

Aetna said well yes because we're losing lots of money.

All right that I mean that seems pretty simple.

Oh it's a nefarious plot to undermine Obamacare don't you

know and the debate surrounding this exodus of insurance companies from the Obamacare exchanges has mostly been

about the wrong thing.

Supporters of the law, opponents of the law are all saying will Obamacare survive they should be asking

What does this mean and what does Obamacare mean for the sick are we improving access to care for the sick?

...