Assessing the Affordable Care Act: The Record to Date
It’s early in the school year for report cards, but it seems like it’s never too soon to grade the Affordable Care Act (ACA). We’ve been getting verdicts about the ACA’s success or failure on a near-daily basis since this historic but monumentally controversial program was signed into law on March 23, 2010.
This fall, however, something is different. Over the last few months, evidence has emerged from surveys and studies that allow us to make some initial assessments.
First, we need to decide what the ACA equivalent of readin’, ’riting and ’rithmetic should be. About a year ago, just prior to the law’s first open enrollment period, we suggested four key areas in which we might grade the law’s progress in 2014. Here are the benchmark measures we set then, and the progress to date in meeting them. We added a few more for extra credit.
1. Are the marketplaces fully functional?
Last year around this time we hoped that the marketplaces would be fully operational by December 23 so that people who wanted their coverage to begin on January 1 could sign up. Following HealthCare.gov’s abysmal opening performance, the U.S. Department of Health and Human Services (HHS) largely repaired the federal enrollment website by December and granted needed extensions to many consumers. But a handful of state-based marketplaces struggled throughout the open enrollment period.
To help grade the marketplaces’ performance, we turn to what consumers reported. The Commonwealth Fund Affordable Care Act Tracking Survey found that people’s experiences in the marketplaces improved over the six-month enrollment period in terms of their ability to compare health plans on the basis of benefits and costs. But 62 percent of people who visited a marketplace by April, May, or June still rated their experience fair or poor. GRADE: NEEDS IMPROVEMENT
2. Did people enroll in the law’s new coverage options?
Last year we used the Congressional Budget Office’s (CBO) estimates for 2014 enrollment as a measure of success. CBO slightly lowered those estimates last spring: 6 million people in marketplaces plans and 7 million newly enrolled in Medicaid. According to HHS, as of mid-August, 7.3 million people were enrolled in marketplace plans and had paid their premiums. As of July, 8 million people had newly enrolled in Medicaid. Since Medicaid enrollment is continuous more people will likely sign up this year. GRADE: GOOD TO EXCELLENT
3. Are fewer people uninsured?
Last year we also used CBO estimates—which have been revised to 12 million fewer uninsured people in 2014—to judge the law’s performance on a third critical measure: reducing the number of uninsured. It's important to keep in mind that this is CBO’s estimate of the difference between the projected number of uninsured nonelderly people had the ACA not passed (54 million) and that with the law (42 million). Estimates from several private and government surveys for time periods in the first half of 2014 point to very good performance on this measure as well. The Commonwealth Fund Affordable Care Act Tracking Survey conducted in April, May, and June found the percent of adults ages 19–64 who were uninsured had declined from 20 percent just prior to open enrollment to 15 percent, which means there were an estimated 9.5 million fewer uninsured adults. Surveys by Gallup, RAND, and the Urban Institute conducted around the same time arrived at similar estimates for working-age adults. The first large-scale government survey data released in September found that as early as February, before the surge in enrollment in late March, the number of uninsured working-age adults had fallen by nearly 4 million from 2013 levels. GRADE: GOOD TO EXCELLENT
4. Is the quality of insurance improving? Is underinsurance declining and are people satisfied with their plans?
In 2012, The Commonwealth Fund estimated that 30 million people ages 19 to 64 with health insurance had such high out-of-pocket costs relative to their income that they were underinsured.1 Last year we set a decline of 5 million underinsured adults in 2014 as a reasonable performance measure. No good data exist yet on this indicator—a problem that The Commonwealth Fund is working to address through ongoing surveys. In the meantime, the Fund’s Affordable Care Act Tracking Survey found that more than two-thirds of adults with marketplace plans rated their health insurance as good, very good, or excellent in June. GRADE: PENDING
Now for the extra credit:
5. Are people using their new insurance to get health care?
In the Commonwealth Fund Tracking Survey conducted in April, May, and June, 60 percent of people who had new coverage through the marketplaces or Medicaid said they had already used their coverage to get health care; 62 percent reported that they would not have been able to access or afford this care previously. People with new coverage appear to be getting the doctors they want and getting appointments with wait times consistent with U.S. averages. GRADE: EXTRA CREDIT
6. Is growth in health care costs moderating?
The ACA has a health care delivery system reform and cost control agenda, though these provisions have received less attention than the insurance reforms. This agenda includes testing alternative ways of paying for health services, as well as new ways of organizing health care providers to provide coordinated care.
In 2013, national health care costs are estimated to have increased 3.6 percent annually, the fifth consecutive year of spending growth below 4 percent. Over the next decade, medical spending is expected to increase at a rate of 5.7 percent, compared with 7.2 percent annual growth over 1990–2008, before the ACA was passed. The annual rate of growth in premiums in employer plans has also moderated. GRADE: PENDING
7. Is the quality of care improving?
The major quality improvement initiatives in the ACA are focused on Medicare. While there have been no major changes in national performance, there have some notable improvements. From 2012 to 2013, Medicare hospital readmissions decreased by nearly 10 percent, likely helped by Medicare’s Hospital Readmissions Reduction Program, which was implemented under the ACA. The Centers for Medicare and Medicaid Services estimates that this translates into 150,000 fewer hospital readmissions. And the number of Medicare beneficiaries served by highly rated four- and five-star Medicare Advantage plans—which receive additional payments under a provision in the ACA—has increased from 16 percent in 2009 to 55 percent in 2014. GRADE: PENDING
There are hundreds of measures other than these on which the ACA could and will be judged—and the objective numbers on progress will not translate, at least immediately, into public perception of how well the ACA is doing. The public’s views, in particular, will be heavily influenced by partisan warfare.
And in some cases, such as cost and quality indicators, drawing a clear causal connection between changes in health system performance and the ACA is difficult. (However, you can be sure that critics would have assumed a causal relationship if performance had deteriorated on any of these measures.)
So far, however, it seems clear that where we have data, the ACA’s implementation has been associated with significant progress. Equally important, some of the potential problems it could have created such as much higher premiums in the individual market or a lack of insurer participation (which has actually increased for 2015) have not materialized.
If the question is: Is the health care system better off in September 2014 than it was in 2010, the answer would seem to be yes.
1By our definition, being underinsured means spending more than 10 percent of income annually on health care, not including premiums, or 5 percent or more for people with low incomes, or having a deductible that is 5 percent or more of income.