Repeal the ACA and Lower Costs for Citizens

by Run75441

Repeal the ACA and Lower Costs for Citizens…

Chicken Little, Courtesy of “EW.Com Entertainment Weekly”

What presidential candidate Romney has vowed to repeal is showing more benefit than harm in driving down the cost of healthcare for individuals, groups, and commercial insurance. If repealed by Romney, the results could cost more than leaving it in place.

The most recent projections of the CBO and JCT reflect a decrease in the insurance cost coverage provision of the ACA over the 11-year period 2012-2022, a decrease of ~$86 billion from the initial projection of $1.252 trillion to $1.1.68 trillion. The projected decrease does not include other aspects of the ACA which in the aggregate will drive the reduction in healthcare cost further. http://www.cbo.gov/publication/43473 , July 24, 2012.

In the same report, the CBO addresses a letter from House Speaker Boehner asking about the benefits of repealing the ACA. Speaker of the House Boehner and he House Republicans have floated a bill which would repeal the ACA. In a separate CBO letter to John Boehner, the CBO estimates the repeal would reduce outlays by ~$890 billion and revenues by $1 trillion. Over the same period 2012 – 2021, the repeal would increase deficits by ~$109 billion. This estimate does not include the hidden costs of people not being insured if the ACA is repealed.

Over at Maggie Mahar’s Health Beat, Maggie touches upon the decreasing cost of healthcare Breaking The Curve of Healthcare Inflation and what the intent is of the ACA:



“- The ACA told insurers that they would no longer be able to shun the sick by refusing to cover those suffering from pre-existing conditions. They also won’t be allowed to cap how much they will pay out to a desperately ill patient over the course of a year –or a lifetime.”


“- insurance companies selling policies to individuals and small companies will have to reimburse for all of the “essential benefits” outlined in the ACA–benefits that are not now covered by most policies and if they hope to stay in business, they will have to find a way to ”manage” the cost of care–but they won’t be able to do it by denying needed care.”


“providers too will be under pressure. A growing number will no longer be paid ‘fees for service that rewarding them for ‘volume’ or for ‘doing more.’ Bonuses will depend on better outcomes, and keeping patients out of the hospital–which means doing a better job of managing chronic illnesses.”


But, what of the overall program results?

– “From 2000 through 2009, Medicare’s outlays climbed by an average of 9.7 percent a year. By contrast, since the beginning of 2010, Medicare spending has been rising by less than 4 percent a year.” It is now ~2.5%.

– “Zeke Emanuel (an oncologist and former special adviser for health policy to White House OMB director Peter Orszag) to Maggie: providers are ‘anticipating the Affordable Care Act kicking in. They can’t wait until the end of 2013: They have to act today. Everywhere I go, ‘Emanuel, added, ‘medical schools and hospitals are asking me, How can we cut our costs by 10 to 15 percent?'”


– “Rather than have Medicare set prices for lab tests and medical devices we should put all such purchases out for competitive bidding. ‘In 2011,’ he (Peter Orzag) pointed out, ‘bidding reduced Medicare spending on wheel chairs and other equipment by more than 40 percent.'”


And for the average person, what are and what were the paybacks? Exploring Maggie’s article further, this chart can be found on the US Department of Health detailing the amounts of rebates in total, by state, and by Healthcare Insurance Company. “The 80/20 Rule” http://www.healthcare.gov/law/resources/reports/mlr-rebates06212012a.html

To take this a step further and look up your own insurance company, a pivot table at the Healthcare.gov site will allow you to look up insurance companies by state and what the average rebate is if called for from the application of the MLR. Your Insurance Company and Cost of Coverage

 How successful the MLR has been can be measured by the impact of the MLR in measuring administrative costs of insurance companies against benefits, providing rebates to citizens, and giving states the ability to review requests for insurance increases through greater access to information. There are fewer double digit increases requested, more decreases in insurance rate requested, and reversals in rates at the state level due to greater information provided to states. 2012 Progress Report: Health Reform is Opening the Insurance Market and Protecting Consumer


Early on, the ACA is having a tremendous impact on controlling and reducing costs providing better value for the money and reducing the inflationary impact of the overall healthcare industry.