How much does the Affordable Care Act cost?
A new study finds that the ACA, the healthcare law signed by President Barack Obama in 2010, is more expensive than it was anticipated, with a $2,400 premium per person in 2020 compared with $1,200 per person a year ago.
The Kaiser Family Foundation, which is the leading health policy research organization in the United States, released the report on Tuesday in a report that it hopes will shed more light on the cost of the healthcare overhaul.
The report, which was prepared for the Kaiser Family Trust and is the most comprehensive analysis of the law so far, found that the costs of the ACA have grown in line with expectations, even as enrollment in the law’s Medicaid expansion continues to rise.
The study finds the cost to enrollees of the Affordable Health Care Act rose by more than 3 percent, to $10,854 per person, in 2020, the largest increase in nearly three years.
The average cost of insurance increased to $6,000 per person from $4,500 in 2020.
The health law’s coverage expansion will cost $3.3 trillion over the next decade, the report found.
The increase in costs comes as insurance companies are struggling to stay competitive.
Insurance companies are now expected to spend an average of $2.1 billion a year covering premiums for 2020, according to the Kaiser report.
“Premiums are likely to continue to rise as enrollment continues,” said Karen Pollitz, the study’s senior author.
“But the growth in costs is largely offset by an expected drop in spending on services.
The expansion of Medicaid coverage will continue to lower the overall cost of healthcare, especially for low-income families and individuals.”
The study also found that more than 30 million people would be covered by the law by 2026, compared with 25 million in 2020 and 13 million in 2019.
The uninsured rate in 2020 was 12.1 percent, up from 11.9 percent in 2020 but down from the highest rate of 13.9 per 100,000 people in 2014.
It was 6.2 percent in 2017.
Pollitz said the results of the study will inform policymakers in Washington as they prepare for a mid-term Congressional budget vote in early January.
“It’s a real shame the Senate and House are moving forward with an omnibus budget resolution that does not include any meaningful funding for the ACA,” said David Cutler, executive director of the nonpartisan Kaiser Family Group.
“As the Congressional Budget Office continues to track the ACA’s cost and benefits, this report confirms what we already know: it’s a big mess.
We have to do better.”
The Senate is expected to vote on its own budget resolution on Jan. 12.
In the meantime, the Senate will hold a vote on the House version of the omnibus bill on Jan, 26, but the legislation is expected not to receive the necessary 60 votes to pass the chamber.
A bipartisan group of lawmakers, including Sens.
Tom Cotton, R-Ark., and Joe Manchin, D-W.
Va., have called for the bill to be stripped of provisions to protect people with pre-existing conditions from being priced out of the market.
The bill would also allow states to opt out of a requirement that insurers cover a pre-exclusion of people with preexisting conditions.
“We are committed to getting this done,” said Cotton, who has been a leading voice in the Senate for years against repealing the ACA.
“The Affordable Care Plan is an essential part of America’s economic future.
We cannot afford to do this without a full repeal of the current ACA.”
The report does not account for how many people would lose their health coverage under the bill, nor how much more the ACA would cost to people than expected.
It does, however, show that enrollment in Medicaid expansion has grown by 11 million in the first year of the program.
In addition, the Kaiser study found that an estimated 14 million people who are not eligible for Medicaid expansion would see their premiums double over the following decade under the legislation.
Pollits report also found, however (pdf), that the law is not making any real difference in the cost-of-living crisis for low and moderate-income people.
The number of people living in poverty has dropped by 9 percent since the law took effect, and the poverty rate among children under 18 declined by 2 percent, according the report.