Quick intro before we get to the matter at hand. Sen. Tom Price’s happened last week. There were a lot of problems about his answers (not willing to double down on crazy anti-vaxxers!) and wanting to defund Planned Parenthood (BOO!). Not to mention some shady stock trades… The vote on his nomination for HHS director has still not been scheduled so call! Contact here!

In my last post, we examined the main parts of the ACA.  Let’s see if they are working. The three main goals of the ACA are to:

  1. Increase the number of insured Americans
  2. Increase patient protections
  3. Make healthcare more affordable

Let’s take these one at a time.  Much of this post is just from the excellent Wikipedia page.

Are there fewer uninsured?  Yes!  The uninsured rate has decreased from about 15% (18% of non-elderly) to almost 8%  (10% non-elderly).  Some 20 million Americans now have health insurance that did not before the ACA. Victory!

cdc_health_insurance_coverage_percent_1997-2015
Figure 1. By Centers for Disease Control (link)

uninsured-rate-among-the-nonelderly-population-1972-2016q2

Figure 2.

Are there now more patient protections?  Yes! By design!  My last post detailed the main ones, that insurers cannot deny coverage for pre-existing conditions and there are no yearly or lifetime maximums.  There are many other parts of the bill meant to protect consumers that we’ll get to in a future post.

Is healthcare more affordable?  This one is by far the toughest to answer.  Part of the issue is how to consider cost: cost to the employer, taxpayer, or worker?  Do we consider cost relative to inflation, average wages, or just as a percentage change?  And part of the issue is who to consider: family plans, individual plans, high deductable plans, low deductable plans, etc.  It’s kind of a mess.  Here is one attempt that is just total growth. The ACA was passed in 2010.

us_health_insurance_premiums_for_families_-_1999_to_2014
Figure 3. By Farcaster at English Wikipedia, CC By-SA 3.1 (link)

This shows much lower total growth after the ACA was passed compared to the decade before it.  Here is another one just for workers with family coverage, compared with inflation and average wage increases:

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Figure 4.

This one shows that the premium decreases were again smaller during the ACA, although the decrease was similar to the wage decrease.  Also, it would be more helpful if this chart began in 2010 and continued into 2016, but this is the best I could find.  Keep in mind that 2009 was the height of the “great recession,” so cost numbers can be difficult to compare in that era.

The bottom line is that the costs to consumers are probably decreasing under the ACA, although this decrease may not be significant relative to average worker wages.  It is important to remember here that the people who signed up under the ACA are sicker on average compared to the average American, which would naturally tend to increase premiums.

Wait, I thought premiums went up because of the ACA!  If you look at the above plots, you will see that premiums indeed are rising every year.  This would be true with or without the ACA because healthcare costs are rising faster than inflation and worker’s wages.

In the next year, however, premiums are set to increase on average by 25%.   That’s bad, but it’s less bad in places with strong marketplace competition and more bad in places with weak competition.  This increase can be attributed to two related causes.  First,this article states that insurers initially priced their plans too low.  Second, and more importantly, Republicans in congress did not appropriate the required money for insurers so they could better mitigate the risk of pricing plans low.  Read about this here.

The bottom line: The ACA is accomplishing its main goals.  How much does this cost?  On average, about 100 billion dollars per year.