Enrollment is Going Up and Costs are Going Down: Some Recent Good News for the Health Insurance Exchanges

In the first two days of operation after the U.S. Department of Health and Human Services (HHS) announced the healthcare.gov website fixed, the portal got almost 2 million visits. And yesterday, HHS announced that in those same two days, 29,000 people signed up for coverage.  That number is higher than the enrollment number for the entire month of October. The enrollment surge – and the fact that the website hasn’t crashed in spite of higher than expected traffic – is good news for the exchanges.

And for consumers, the New York Times this week reported on what may be even better news over the long term: New, lower Congressional Budget Office (CBO) projections for health care spending under the Affordable Care Act.

To be sure, a lot of the slowed growth in health care spending can be attributed to the recession but independent analysts note that the ACA has also had a significant effect. Indeed, while the economy has been gathering strength, the rate of growth of health care costs has held steady at its lowest rate since the 1950s. One important way the ACA is driving cost containment is by rewarding quality of medical care over quantity of medical care, which represents a fundamental shift in the incentive structure in the health care sector – and one that is likely here to stay.

CBO now projects much higher cost savings in both private and public health insurance than originally projected in its 2010 budget baseline. CBO’s latest projection of spending in 2020 for Medicare is now 15% lower than its 2010 estimate, and 16% lower for Medicaid spending. In the private market, new CBO projections of health insurance premiums per enrollee in 2020 are 9% lower than their 2010 estimates. One independent health economist estimates that if costs continue to grow at this low pace, the cumulative savings to the federal government could total more than $750 billion over the next ten years. These savings ultimately accrue not only to federal taxpayers, but to all consumers of health care services.

While we’re likely not yet out of the woods with healthcare.gov’s technical glitches, this post-Thanksgiving week has offered news to be thankful for.



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