ACA at Five Years-Five Things Worth Celebrating/ 5 Year Highlights (7/8/15)

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Source data: Katherine G. Carman, Christine Eibner and Susan M. Paddock. “Trends In Health Insurance Enrollment, 2013-15,” Health Affairs, May 2015, which cites RAND’s Health Reform Opinion Study.

The ACA at Five Years – Five Things Worth Celebrating

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The Affordable Care Act (ACA) turned five this spring without a lot of fanfare.  Unlike other milestones in the ACA’s journey, there was no dramatic event for the media to cover.  And yet, there is actually a lot to cover – despite many setbacks, a tremendous amount of ground has been gained in the past five years and the overall results have been positive.  Here are five things worth noting, and possibly even celebrating:

1.  Number of Uninsured has Decreased

In less than two years, the number of uninsured people has decreased significantly.

  • A recent Rand survey shows that the number of uninsured people has decreased by 16.9 million since September, 2013 (right before the ACA’s first open enrollment period).  This is a 40% decrease in the number of uninsured people (from 42.7 million to 25.8 million).
  • Interestingly, the majority of the uninsured gained coverage through employer-sponsored plans (9.6 million), not the newly established exchanges.  (The ACA requires people to enroll in their employer’s plan if it’s affordable, rather than seek exchange coverage.)  Medicaid picked up the next biggest portion (6.5 million), and then the exchanges (4.1 million).

2.  Public Support is Returning

The ACA has never enjoyed strong support in public opinion polls – its highest level was 50% a couple of months after the law passed.  After the disastrous launch of the federal website in October 2013, support for the ACA hit an all-time low (33%).  However, since then, support has grown again, and reached a relative high of 43% in April.  It’s also worth noting that this is the first time since 2012 that the share of people supporting the law (43%) exceeded those opposing it (42%).

3.  Consumer Experience has Improved

Improving the consumer experience was a top priority for federal officials overseeing the website this year.  They made significant upgrades to the website before the second open enrollment period, and the results are in.  According to a recent survey by the well-known consumer research firm, J.D. Power, exchange customers rated their experience higher than those enrolling in traditional employer-sponsored insurance.  (And the score was even higher if they were able to automatically reenroll in coverage.)  These scores represented a huge improvement over the previous year.

4.  Individual Mandate had No Backlash

2015 marked the first tax filing season with the full implementation of the requirement to purchase health insurance (known as “the individual mandate”).  This requirement is one of the least popular provisions of the ACA, and many people expected a public outcry once the tax penalties for not having coverage actually went into effect.  There was no such outcry.  There is speculation that the numbers of people affected weren’t large enough and the penalty wasn’t big enough in its first year to spark such an outcry.  So there may be more of a reaction in 2016, particularly as election year rhetoric heats up.  That said, the number of people benefitting from the ACA subsidies certainly exceeds the number of people who are expected to pay a penalty.  So this will be interesting.  Stay tuned…

5.  Health Care Businesses are Benefitting

Taken as a whole, the health care industry has benefitted from the ACA.  While some companies have done better than others, most insurers have seen an increase in their customer base, and hospitals have seen a reduction in uncompensated care.

  • The number of insurers participating in exchanges increased over the first two years, and they haven’t reported big issues with the health risk of new enrollees.
  • Hospital uncompensated care costs are estimated to be 21% lower in 2015 than they would have been if insurance coverage had not been expanded through the ACA.  This represents a $7.4 billion savings for hospitals.  Notably, the volume of uninsured admissions to hospitals has decreased significantly in Medicaid expansion states.