The Patient Protection and Affordable Care Act was, at its core, intended to do two things: Make sure more people have health insurance, and reduce the cost of care. New data from the federal government now shows that it could end up achieving both of those goals in the coming years.
The number of uninsured Americans could decline to just 23 million by 2023, down from 2012's level of 45 million, largely as a result of the expanded health insurance offerings of the ACA, according to a new study from the Centers for Medicare and Medicaid Services Office of the Actuary. Marilyn Tavenner, administrator for CMS, noted that along with the decreased uninsured rates, health care costs are increasing at a slower pace, and that should help both consumers across the country and the economy going forward.
In fact, nationwide growth in health spending is likely to remain at less than 4 percent for last year, marking the fifth straight year in which that was the case, the report said. However, expected annual growth is likely to be more in the neighborhood of 5.7 percent for the decade from 2013 to 2023. That's expected to be up from the projected Gross Domestic Product increase of 4.6 percent.
What effect will the ACA have?
Of course, the 5.7 percent growth rate is impacted by the projections for 2013 and 2014, which are likely to remain low, the report said. For 2015 to 2023, the assumption should actually be closer to 6 percent. However, it's important to note that the increase in trend would happen because more people will have health insurance during that time, rather than a smaller number of people having to pay more. Furthermore, 6 percent increases do not come close to matching the average annual jump of 7.2 percent observed from 1990 to 2008, which outstripped the GDP improvement of 5.2 percent.
Health insurance companies might therefore want to start making a more concerted effort to reach consumers who are not yet insured, because the reality is that a massive number will be signing up in the coming years. With this in mind, tailoring affordable options to better meet the needs of these potentially low-income consumers could go a long way toward improving customer enrolls overall.