Spending, Costs, and Deficits – New Health Care Law

All health care fast facts are from the non-partisan Congressional Budget Office (CBO) and Center for Medicare and Medicaid Services (CMS).   Although they represent many of their reports on this subject, they do not represent all of their reports on this subject.  Occasionally minor word adjustments may have been made for clarity or to reflect the updated nature of the statement.   As always, verify and view statements in their full context as often as possible.

The actual future impacts of the PPACA on health expenditures, insured status, individual decisions, and employer behavior are very uncertain. The legislation would result in numerous changes in the way that health care insurance is provided and paid for in the U.S., and the scope and magnitude of these changes are such that few precedents exist for use in estimation. Consequently, the estimates presented here are subject to a substantially greater degree of uncertainty than is usually the case with more routine health care legislation.  Click here to verify at Page 4
The same substantial degree of uncertainty that surrounds Congressional Budget Office (CBO) and Joint Committee on Taxation’s (JCT) estimates of the impact that the PPACA would have on insurance coverage rates and the federal budget also accompanies this analysis of the proposal’s effects on premiums.  Verify here
CBO projects that if current laws do not change, federal spending on major mandatory health care programs will grow from roughly 5 percent of GDP today to about 10 percent in 2035 and will continue to increase thereafter.  Those projections include all of the effects of the recently enacted health care legislation, which is expected to increase federal spending in the next 10 years and for most of the following decade.   Click here to verify at Summary Page
In 2014, health spending is projected to grow 8.3 percent. This projected acceleration in the growth rate, up from 5.5 percent in 2013, is primarily the result of the Affordable Care Act’s coverage-related expansions.  Click here to verify at Page 1
The new health care law includes a number of provisions that are intended, in part, to help control health care costs and to change the overall trend in health spending growth.  Many of these are specific to the Medicare program.  Click here to verify at Page 12
Both the expansion of eligibility for Medicaid and the provision of subsidies through new insurance exchanges will increase federal spending.   At the same time, the legislation contains various provisions that will substantially reduce spending on Medicare relative to what would have occurred under prior law.  Click here to verify at Page 8
Additional Federal funding provided by the American Recovery and Reinvestment Act of 2009 and the Education, Jobs, and Medicaid Assistance Act of 2010 has alleviated some pressure on the States, but it is apparent that the Medicaid program is large enough to place serious strain on many States’ budgets.   Click here to verify at Page 35
The CBO reported budget deficits would be reduced, in their estimation, if the provisions of the new health care law remain unchanged throughout the next two decades.  However, the new health law would maintain and put into effect a number of provisions that might be difficult to sustain over a long period of time.  Verify here
The actual costs under the PPACA and the reduction in the number of uninsured persons may be somewhat higher or lower than estimated in this memorandum.   Click here to verify at Page 19
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