Managed Care

 

More are insured, but what about costs?

MANAGED CARE December 2012. © MediMedia USA
Managed Care Outlook

More are insured, but what about costs?

The Kaiser Family Foundation predicts that the Affordable Care Act will cut the number of uninsured in the United States by half in three years by adding 30 million people to the insurance rolls, says its study “The Uninsured: A Primer” (http://tinyurl.com/uninsured-study).

However, even with the ACA, Kaiser expects there to be about 26 million uninsured in 2016, and while that’s better than had the law been repealed, some of the uninsured are likely to be with us for some time. “These individuals are likely to include: immigrants who are not legal residents and are therefore not eligible for Medicaid coverage or for federal premium subsidies; people who are exempt from the mandate, in most cases because they do not have access to affordable coverage; [and] people who are subject to the mandate but choose to pay the penalty rather than purchase health insurance,” says the report.

That something needed to be done about those falling through the coverage cracks is something policy makers of all political stripes agreed on. They also agree that health care costs are rising at an unsustainable rate — and, so far, no one’s figured out how to solve that problem. The Congressional Budget Office says that long-term spending will be caused primarily by entitlement programs such as Medicare, Medicaid, Social Security “and (to a lesser extent) the insurance subsidies that will be provided through the health insurance exchanges established by the Affordable Care Act.”

Some will fall through the cracks in 2016

1212.outlook_fig1.gif

CBO’s 2012 Long-Term Budget Outlook, released in June, adds that “The health care programs are the main impetus behind that growth; they are responsible for about four fifths of the total projected rise in spending on that set of programs over the next 25 years.”

The CBO expects that through 2022, the aging of the population will cause spending on the major health care programs to rise significantly. The agency adds that growth in spending per beneficiary will increase as well.

The CBO’s predictions are based on two different assumptions. One, the extended baseline scenario (at right), maintains that “current laws generally remain unchanged” and that lawmakers will forgo “adjustments routinely made in the past that have boosted deficits.”

Federal spending on major health care programs

Percentage of gross domestic product

1212.outlook_fig2.gif

Sources: “The Uninsured: A Primer,” Kaiser Commission on Medicaid and the Uninsured, October 2012; Congressional Budget Office

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