year | growth rate
2005 | 6.7% (Bankruptcy act passed making it harder to discharge medical debt)
2006 | 6.5%
2007 | 6.5%
2008 | 4.5% (Great Recession)
2009 | 4.0%
2010 | 4.1% (ACA Signed)
2011 | 3.5%
2012 | 4.0%
2013 | 2.9% (ACA Taxes)
2014 | 5.1% (Exchanges Open)
2015 | 5.8%
2016 | 4.3%
2017 | 3.9%
There are also a couple of timing advantages that people give credit to the ACA that would have happened otherwise.
There were a lot more prescription drugs created after the Orphan Drug Act and the Hatch-Waxman bills of the early 80's. So the timeline for that is 83-84 laws passed => research => 1990-1999 prescription drug explosion => 2010 - 2019 patents expire. This lead to a dramatic increase in costs over this period, but this is good since people now have access to drugs that wouldn't otherwise exist. The patents expire and the costs decrease, and they won't likely increase further due to the nature of those bills.
You could also make the point that from 2001-2006 you should see higher healthcare costs due to war.
A lot of the calculated savings are based on government projections of future spending. We can go off on a tangent on how good the CBO is at its job, but I think we could agree that predicting the future is hard and people are frequently wrong about their predictions.
Furthermore, lower costs aren't necessarily a positive thing. To put it simply if you are buying a BMW and I am buying a Kia, they are both cars but you aren't unhappy to pay the higher price.
Percentage increases also get harder to maintain as time goes on.
Healthcare expenses increase during wartime since you have to treat newly injured veterans. That statement basically can be interpreted as "people get injured on battlefields and it costs money to treat them".
Second: I have followed health policy for quite awhile, and it's not clear to me at all what impact you believe your parenthetical callouts had on health costs.
Bankruptcy Law: In 2005 there were 2,000,000 bankruptcy filings, in 2006 there were 600,000. This was a result of the passing of the BAPCPA in 2005. At that point in time 46% of bankruptcies were due to medical bills. This change increased the expected value of delinquent accounts which in turn should lead to lower costs for medical services.
Great Recession: People put off non-essential medical expenses, or delay usage of medical services. Someone who might get braces doesn't, someone might take care of a parent themselves instead of hiring an in-home nurse, etc.
ACA Signed: Marker for before and after growth rates.
ACA Taxes + Exchanges Open: The two main policies of the ACA intended to curb healthcare costs go into effect. I would classify these two years as overestimation of savings and regression to the mean. Most insurance companies had to backtrack after their financial projections did not materialize.
Also, many veterans get care outside the VA. From my own experience working with these people, they cite long waiting times or broken relationships with the government for not wanting to take part in that system.
I'm not trying to downplay the complexity of the healthcare market, it's really complex. However, it I were to pick the things the government had control over and impacted the marketplace the most over the last 15 years, I still would pick the same things I did. I could fill several books with other changes that impacted the cost of American healthcare. (switching to e-prescriptions, subsidies for electronic medical records, medicare part D, certificate of need laws, FSA changes, HSA changes, consolidation of pharmacy benefit managers, health system consolidation, the opioid epidemic, the rise of the physicians's assistant, the expanding role of nurse practitioners, etc.)
I'd rather spend my time continuing fixing the things I know I can make better.
[0]: https://www.cms.gov/Research-Statistics-Data-and-Systems/Sta...
https://www.cms.gov/Research-Statistics-Data-and-Systems/Sta...
https://www.cms.gov/Research-Statistics-Data-and-Systems/Sta...
https://www.cms.gov/Research-Statistics-Data-and-Systems/Sta...
https://www.chcf.org/publication/us-health-care-spending-who...
The main one you might be interested in is this one though, https://www.cms.gov/Research-Statistics-Data-and-Systems/Sta...
I've excerpted this from page 34 for your convenience.
"Other public programs include health insurance coverage provided by the Department of Veterans Affairs (VA) and the Department of Defense (DOD). Enrollment for other public programs for 1987-2011 was estimated using the levels from the enhanced CPS (SHADAC) and for 2012, 2013, and 2014 estimates were extrapolated using the CPS. "
[0]: https://www.cms.gov/Research-Statistics-Data-and-Systems/Sta...
1999 2196
2000 2471 12.52%
2001 2689 8.82%
2002 3083 14.65%
2003 3383 9.73%
2004 3695 9.22%
2005 4025 8.93%
2006 4242 5.39%
2007 4479 5.59%
2008 4704 5.02%
2009 4824 2.55%
2010 5049 4.66%
2011 5429 7.53%
2012 5615 3.43%
2013 5884 4.79%
2014 6025 2.40%
2015 6251 3.75%
2016 6435 2.94%
2017 6690 3.96%
2018 6896 3.08%https://www.kff.org/interactive/premiums-and-worker-contribu...
I'm sorry for getting snippy, I just couldn't untangle your numbers from your source even after you pointed to the raw XLS you got it from.
If we just stay focused on commercial health care, we don't have to litigate whether the Iraq War (materially) impacted health care costs prior to the ACA. And: this thread is about whether employer shifts to HDHPs and (more broadly) the ACA has impacted those specific costs, not the total government cost of providing all health care services.
Say what you will about the ACA, but requiring folks to purchase a product while doing not curbing the rampant greed in the industry screams of corporate welfare to me.
Even after Bernie Sanders, the "Very Serious Democrats" talk more of protecting the Health Insurance Industry than anything else. Best case, we'll see a timid proposal of a expensive Medicare Buy-In added to the ACA exchange that will never get past the Senate.
Both in service of capital.
If you're saying the ACA harmed the health care system, strong disagree. Again: the cost increases you're talking about were a fact of life before the ACA. There is no evidence that your costs would have leveled off without the ACA, and substantial evidence that the opposite would have happened.
That said, I agree the costs would have continued to go up, but to say there is no evidence that the ACA contributed to it is just ignoring the math.
We haven't needed the coverage for two years but when we did, what we needed wasn't covered so we paid full price anyway including $80 for a bottle of Ibuprofen that was casually offered to us. The markups are almost criminal.
For a $1M home you can find insurance for $1,500 per year. It's exponentially less expensive.
ACA was the worst possible compromise to a serious problem. A public option, universal healthcare or deregulation all would have been better options.
It'd be much nicer to be able pay a doctor to make house calls as needed and waive your right to a malpractice lawsuit than to pay to support this insurance/legal/government system we have now.
Is there any alternative though? We're going to pay those costs one way or another: either the government pays for all the unprofitable patients' healthcare (the wet dream of health insurers), or we tell those people to go fuck themselves.
Those patients have no coverage so get Emergency treatment for acute symptoms of their issues that rarely fix the underlying problem, and beyond that we also tell them to go fuck themselves.
That being said, I'm not disagreeing that costs went up after the ACA more than they would have, but, IMO that was just insurers/providers raising prices because they could.
There are all sorts of things that should have (and perhaps even did) impact prices after the ACA. Not just coverage requirements (which, again: most employer-provided health plans --- which is what we're talking about here --- already complied with), but, more importantly: unprecedented instability in the insurance markets during the almost decade-long concerted effort by the GOP to hamstring and ultimately repeal the bill. And yet, the numbers are right there: health care costs are growing, but they are not growing more than they were prior to the ACA.
Sure, costs went up less after ACA.
However, the ACA directly added costs to insurance that weren’t there previously.
What were those?
Can you help me understand the argument you were trying to make above? I continue not to grok the point you were trying to make.
The system? No. Corporate welfare is great for "the system." But the consumers? Absolutely harmed!
> Again: the cost increases you're talking about were a fact of life before the ACA.
I've been working for over a decade now. 100% increases, year-over-year have never been even close to a thing with employer plans I've held. Not even close. Typically something in the realm of $20 per year at worst for a quality plan.
Here is another fun anecdote. I recently lost a job, and my firm was too small, with only 4 insured, to qualify for the COBRA. Total premium for the plan was roughly $150, roughly $75 per party as my employer paid 50%. Comparable coverage through the same insurer through the marketplace would have cost me nearly 4x as much.
The reality is the ACA allows insurance firms to sell obscenely over-priced plans to consumers. A sane system would have seen price controls in conjunction with the requirement for insurance. Instead I am forced to pay an insurer, pay the government, or prison. I would happily pay taxes for a fully nationalized system, but the ACA is obscene.
The only connection you’re making here is that your own costs went up after the ACA. It’s a post hoc fallacy.
The connection is that the ACA rates, and rate-increases are out-of-touch with the employer-offered system, even when those firms are tiny and not nearing some kind of "scale" cost-savings.
I have been hollering about this issue for years, and I've yet to have someone say "Ya know, I actually experienced something radically different." So where is all this evidence you claim but can't be bothered to provide?
There also isn't one "employer offered" system. In addition to the aformentioned small-group marketplace, there are also large group plans that cover big companies, and very big companies often self-insure, using health insurance companies solely to administer benefits but financing the care themselves. Can you be specific about which of these kinds of health care financing have been impacted by the ACA, and how?
As far as I am aware, the ACA actually introduced limits on how much mark-up health insurance can have, where 80% of the cost must go to actual medical expenses, and administration, marketing, etc must be no more than 20% total. So how is the ACA the cause of insurance mark-up?
I think the actual root of the problem is not mark-up but that health care in the US is quite expensive (and always increasing). The ACA in some cases shifts who pays for it (young healthy people pay more), but it doesn't appear to change much the overall cost. It sucks temporarily for those younger people, but considering they will most likely become older, less-healthy people over time it doesn't seem that unfair overall.
> A sane system would have seen price controls in conjunction with the requirement for insurance.
If you are paying 4x more though, it sounds like the marketplace may be breaking down in your location with a "death spiral", where the price goes up, all the healthier people leave, causing the remaining insurance pool to be even sicker and the price going up even more. The whole purpose of the mandate was to prevent this, but it looks like it's been repealed. Price controls in that situation is hard since the pool is actually expensive to insure, I don't think the government can force the companies to sell at a loss. To reverse it maybe they could re-instate the mandate, or change it to a tax, or add a public option. Or, of course, give up on insuring pre-existing conditions.
> I would happily pay taxes for a fully nationalized system
Keep in mind, there are other countries like Germany and France that have private insurance markets and much cheaper care. I think it is fully possible for the US to implement a nationalized system that does not achieve the cost-effectiveness that we want. The VA system might be an example of how that might go.
One of the issues (and I like the ACA generally), is that that limit removes an incentive for the insurance companies to control costs and the 20% markup becomes a floor, not a ceiling. If they get 20% of revenue as non-medical costs, and they want to increase their profit, the best way to do that is to allow medical costs to increase. Then their 20% is larger because the pie of costs is larger.
One thing I wonder though, is that even without the 20% rule, if the company can get away with raising rates by 5%, wouldn't it make sense for them to do so? If they started with a 20% margin that would increase their profits by a whole 25%, instead of a measly 5% with the cap, so you'd think the incentives would be even stronger. It seems like adequate competition is the most important thing in a for-profit insurance model rather than having a 20% margin rule or not.
I don't think ACA plans are much more expensive that what we are _really_ paying for employer insurance. I recently became unemployed and when I priced it out, an ACA plan that offered benefits similar to what I would get with a COBRA plan were pretty much the same price - both ridiculously expensive, so I went with a cheaper silver HMO ACA plan. And my old employer charged a 4% "fee" on COBRA premiums as well - I guess the benefits companies want some of the action.
Additionally: you can (you shouldn't have to, but you can) shop around for cheaper medical imaging. Imaging in particular has wildly varying prices, and if you stay on the "happy path" your PCP and hospital puts you on, you're going to pay the higher end of the range of prices.
You are not, as a general matter of life advice, better off going without health insurance. Rather, find the least expensive HSA-qualified HDHP, fund the HSA with the savings, and pay for routine care (effectively) out-of-pocket. The point of insurance isn't to make your annual checkup cheaper, but rather to avoid going bankrupt if you get hit by a car or your appendix bursts.
From the way you write, your appendix presumably hasn't burst yet. That's great! Neither has mine! My house has also not caught fire† and I have not managed to crash my car into a fully occupied city bus. But I am insured against both of those things, too.
† since we bought it, i mean
And nope, still on my original appendix... I change the oil regularly.
With that said, as a type 1 diabetic, without ACA it would be impossible for me to get insurance outside of employment, so i think there is some good in it, just needs to be actually thought through, unlike what the administration did that put it in place.
It's impossible because you both political parties want exclusively mutual results
You can't have cheap insurance without making it mandatory since only the sick will get it
You can't have easily accessible insurance without forcing healthcare companies to comply with new regulations forcing them to increase costs
You can't have good insurance if you aren't willing to pay the market price which happens to be very inflated in the US
You cant lower costs in the US without having a more aggressive regulatory body which 50% of political bodies strongly oppose alongside lobbying efforts
Overall, it's a shitshow that will keep being patchworked every time the administration changes between parties.
Here is the fundamental problem from my point of view. Compare human medical costs to veterinary costs. Yes, people expect a slightly higher standard for themselves than they do their animals, but you can get a major knee surgery for your dog for a small fraction of what they charge for humans. The process is performed in a sterile environment by professionals in either case. We're smarter than animals on average, but our bodies and medical needs aren't vastly different.
The problem is price gouging because the providers and insurance companies know we have no real ability to shop around. They conspire with each other to publish false rates when the true costs are much lower after you agree to them.
You could maybe solve this with regulation on prices (a socialist approach), but you could also solve it by mandating they advertise true prices and re-enable competition (a capitalist approach). Either way could fix this, and the problem is corruption (lobbying) not party ideology.
Maybe these aren't the "true prices"? I certainly wouldn't know where to look to find how much a "knee surgery" would cost, and I'd probably need to know some obscure medical code I don't have access to, as well as the intricacies of the knee surgery to know exactly what price to look up. I don't know how publishing "true prices" would work.
What kind of knee surgery am I having? Will I have to pay extra for the anesthesiologist? What kind of anesthesia will they be using? What about surgery preparation? What costs do I need to include for that? What about post surgery? There's probably a dozen cost items to add to the total for post surgery. The nurse brought me a glass of water. I'm not sure if that comes with a charge or not? Presumably someone has to pay for the plastic cup. Etc.
This is exactly the problem. They publish "prices" but those prices don't mean anything.
You're right that the complexity of medical billing also makes it difficult to anticipate and compare prices. However, that might be more of a side effect of how the billing is done, rather than an unavoidable attribute of medical care.
Arguably, medical providers have the information and capability to package procedures and publish what it actually costs to do them. But they have no incentive to do so, and many incentives to not do so.
We should expect hospitals to meet the minimum ethical standards of auto mechanics.
I mean you can't really compare vet bills to surgery bills. Veterinarians have actual price constraints where the owner is willing to put their foot down once it gets beyond a certain point. They love their pets but they aren't willing to go financially insolvent for them.
No such constraint exists for American healthcare. You pay what they tell you until you are destitute and on Medicaid.
> by mandating they advertise true prices
I think most Americans want this to be the solution and it still won't work unless there is pressure on the entire system. Doctors, hospitals, surgery theaters, radiology, and diagnostics have such complex billing that even if you could price compare are you even capable of understanding what those options do?
It's impossible because you both political parties want exclusively mutual results
The post you replied to said:
> the ACA in fact reduced the rate of growth in health care costs.
Meaning the RATE of increase slowed. The Department of health & Human Services estimates that the ACA saved $2.3T up through 2017 ($650B in 2017 alone). Premiums haven't gone down, and they weren't estimated to.
Employees being people bought the "Obamacare made my premiums go up!"