Summary of President Obama’s Assessment of the Affordable Care Act and Recommendations on the Next Steps of Health Care Reform

Summary of President Obama’s Assessment of the Affordable Care Act and Recommendations on the Next Steps of Health Care Reform


In a recent JAMA article, the President assesses the progress of health reform and makes his recommendations for next steps.  The article includes some excellent graphs showing the improvements in coverage, cost, and quality.

Overview: The Affordable Care Act has covered over 20 million Americans, slowed the rate of increase in health spending and improved the quality and outcomes of care. His recommendations include: improving affordability in the Exchanges so more people are covered with refundable tax credits, increasing competition in marketplaces with insufficient plan choice through the addition of the public option, working with the 20 states still not participating in the Medicaid expansion, and reductions in the rising costs of prescription drugs through greater transparency and the ability to negotiate drug prices with pharmaceutical manufacturers.

Increasing coverage for the uninsured: The uninsured rate nationally fell from 16% in 2010 to 9% in 2016 – about 20 million uninsured Americans now have coverage. There are about 29 million remaining uninsured nationally, of whom about 4-5 million are in the 2o states primarily in the South and Great Plains who have not yet decided to expand their Medicaid programs. In three states with quite high uninsured rates prior to the ACA and Medicaid expansions under the ACA, uninsured rates fell by 12 percentage points or more. In one state with an uninsured rate of about 28%, which rejected the Medicaid expansion, the uninsured rate fell by only 4%.

Filling in the gaps in coverage for the insured: Those with coverage experienced better access to doctors and medicines, lower out of pocket burdens, less financial hardship and improvements in health status. Those with coverage now have preventive services, mental health coverage, substance abuse treatments and relief from annual and lifetime caps that exposed them to catastrophic health costs. For example, 20% of persons with employment-based coverage had annual benefit caps before the ACA, that figure is now about 2%. The donut hole in senior’s prescription drug coverage is being reduced to next to nothing and preventive services have been added for seniors and the disabled on Medicare.

Slowing the rates of growth in health spending: The rates of increase in health coverage per capita fell for private insurance, for Medicare and for Medicaid. Private insurance per capita spending fell from 6.5% annual increases between 2000 and 2005 to 3.4% from 2005 to 2010 to 1.1% annually from 2010 forward. Medicare spending per capita fell from 4.7 % annual increases between 2000 and 2005 to 2.4% from 2006 to 2010 to negative 1% annually from 2010 forward. Medicaid per capita spending fell from 1.0% annual increases between 2000 and 2005, to 0% annually from 2005 to 2010 to negative 1% annually from 2010 forward.

Improving quality: The rates of hospital-acquired infections fell by 17% saving 87,000 lives over four years. The rates of hospital readmissions for Medicare patients fell. There were 565,000 fewer hospital readmissions between 2010 and 2015.

Reforming payments and delivery systems: Alternative payment models that emphasize delivery system improvements in quality and price in Medicare have gone from 0% in 2010 to 30% in 2015.

Recommendations from the President: Improve the performance of the marketplaces, complete the expansion of Medicaid, reorient payment systems to further improve quality, accountability and efficiency. Use the savings achieved by the ACA to increase the tax credits for individual coverage offered in the marketplaces. Encourage greater competition in the marketplaces by offering a Medicare-like option (i.e. lower prices and less administrative overhead) in communities with inadequate competition. Improve transparency of drug pricing, increase the rebates for Medicare and Medicaid and give government the ability to negotiate prices of high cost drugs. Retain and improve the Cadillac benefits tax and the Independent Payment Advisory Board (IPAB) to reduce the growth in per capita spending for employment-based insurance and Medicare.


Prepared by: Lucien Wulsin

Date: 7/20/16





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