Wednesday, January 25, 2017

Changes in Enrollment and Costs: Affordable Care and Patient Protection Act

Expanding the number of people with health insurance is the main achievement of the Patient Protection and Affordable Care Act of 2010. In 2017, the Patient Protection and Affordable Care Act is projected to have added about 12 million people to Medicaid, while providing subsidies for about 9 million people to purchase health insurance through the exchanges each month. But there's no magic in how this happened. In 2017, it cost the federal government about $70 billion for the Medicaid expansion, plus $49 billion for the subsidies. Moreover, the law has been (as expected even by its supporters) only a partial fix. About 27-28 million remain without health insurance in 2017, and that
number isn't expected to change much under current law. So says the Congressional Budget Office in "The Budget and Economic Outlook: 2017 to 2027" (January 2017). Here's CBO: 
"By CBO’s estimates, an average of 12 million noninstitutionalized residents of the United States under age 65 will have health insurance in any given month in calendar year 2017 because they were made eligible for Medicaid under the ACA [Affordable Care Act]. That expanded eligibility for Medicaid applies principally to adults whose income is up to 138 percent of the federal poverty guidelines; the federal government pays nearly all of the costs of expanding Medicaid coverage to those new enrollees. ...
"In addition, CBO and JCT [Joint Committee on Taxation] estimate that, in calendar year 2017, 9 million people per month, on average, will receive subsidies for nongroup coverage purchased through the health insurance marketplaces established under the ACA. Subsidized health insurance is now available to many individuals and families with income between 100 percent and 400 percent of the federal poverty guidelines who meet certain other conditions; they can purchase coverage through designated marketplaces and receive tax credits that subsidize their insurance premiums, as well as cost-sharing subsidies. ...
"From 2017 through 2027, under current law, the number of uninsured people under age 65 would remain around 27 million or 28 million. ...
"CBO and JCT currently estimate that federal spending for people made eligible for Medicaid by the ACA [Affordable Care Act] will be $70 billion, or 0.4 percent of gross domestic product (GDP), in fiscal year 2017. Such spending is projected to rise at an average annual rate of about 7 percent, reaching $142 billion (or 0.5 percent of GDP) in 2027. ... The agencies also estimate net federal subsidies for coverage obtained through the marketplaces to be $49 billion, or 0.3 percent of GDP, in fiscal year 2017. Those subsidy amounts are projected to rise at an average annual rate of about 9 percent, reaching $110 billion (or 0.4 percent of GDP) in 2027."