What’s so affordable about the Affordable Care Act?

Jeff Belle 06 13 What’s so affordable about the Affordable Care Act?

By Jeff Belle

As with the majority of public policy, intent and pragmatism may not be in agreement. The Affordable Care Act of 2010 isn’t any different. In fact, the question is: How affordable is the Affordable Care Act? Is this massive health care expansion a life-vest for those without health care or is an expensive cruise ship plagued by over- flowing sewage and distasteful meals? Clearly there are two-sides to this question as in any worthy argument. Here are a few thoughts and facts to consider about the affordability of the Affordable Care Act (ACA).

ACA as passed into law in March 2010 requires individuals to maintain “minimum essential coverage” or pay a tax penalty. In this case, minimum essential coverage includes government-sponsored coverage such as “Medicare, Medicaid, Children’s Health Insurance Program (CHIP), Veteran’s health benefits, employer-sponsored coverage, and other coverage as approved by the Secretary of U. S. Health and Human Services.”

According to Congressional Budget Office (CBO), implementing ACA will cost $ 1.8 trillion dollars over 10 years. It was estimated at the onset of the ACA legislation in 2009 that the cost would be around $900 billion over 10 years. In reality, the cost over 10 years has now doubled. These projections are for 2014 to 2013 when ACA goes into full effect.

Since its inception in 2010, what has ACA cost taxpayers? According to the General Accountability Office (GAO), the IRS (of all federal agencies) has spent $881 million between 2010 and 2013. Here’s how the IRS has spent our tax dollars in implementing the ACA in just two and a-half years:

  • $ 2.1 million and 13 full-time employees to implement the tax increases on drug manufacturers and health insurers,

  • $ 12 million and 150 full-time employees to “ customer service support”,

  • $ 405.2 million and 700 full-time employees to creating the infrastructure to support the exchanges and the individual mandate tax, and

  • $ 20.8 million along with 161 full-time employees to “promote compliance with other new provisions.”

In order to enforce provisions of the ACA which include 18 separate tax increases, business and individual mandates and an enormous number of new regulations; the IRS requested even more spending—“ a whopping $ 439.6 million and 1,954 {new} employees.“ Now, if indeed, we {United States} are in need of a life-vest or perhaps a cruise vessel to provide expanded medical care coverage is a matter of public opinion. Why would anyone in their “right mind” empower the IRS to monitor and enforce health insurance? Empowering the IRS to enforce health insurance mandates is akin to “asking chickens to vote for Colonel Sanders”-go figure! However, the facts regarding the affordability of ACA, as we now know them, may propel us to rethink the sanity of the Affordable Care Act and the wisdom our leaders in Washington.

Sources:

Government Accountability Office, June 2012

Congressional Budget Office, May 17, 2013

Congressional Budget Office, March 13, 2013

Washington Post, April 26, 2013

The Hill, April 10, 2013

Forbes, March 12, 2012

Belle is a Senior Fellow at the Institute for Public Policy and Leadership Development. He researches, writes and lectures on health policy and leadership development issues. He is a resident of Antioch.

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4 Comments to “What’s so affordable about the Affordable Care Act?”

  1. Kenji Freitas says:

    The other problem is, where will all of these additional patients go? In our county, for example, it is expected that our Contra Costa County Health Plan will gain 40,000 new patients as a result of this, yet the county hospital and clinics are at capacity! That means wait times for routine appointments will be even worse than they are now and emergency rooms, already at capacity, will get even busier by patients who could not get appointments with their regular doctor. The politicians did not consider the additional infrastructure that needs to be in place for all of these new patients, it takes millions of dollars and several years to build and open a new outpatient clinc, even more for a hospital. In CA we are in a budget crisis, making it even more difficult.

    • Jeff says:

      Kenji,
      I agree with your concern about the ” lack of adequate infrastructure” to support expanding health care. However, I’m of the opinion that there will not be a proliferation of new patients entering the system between Oct.1st and Dec. 31st. As you mentioned, the infrastructure isn’t in place nor has the public bought into the enrollment process.
      Thank you for your valuable input.

  2. Christopher Grisham says:

    Interesting thoughts Kenji. Thanks for the heads up.

  3. Nice post. Thank you for taking the time to publish this information very useful

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