In spite of the debacle that has been the start to the Affordable Care Act's federal health insurance exchange, the law is working, slowing the cost of healthcare since the law's implementation in 2010, according to Harvard University economics professor David Cutler in an op-ed piece for the Washington Post.
Cutler, who served as a senior healthcare advisor during Barack Obama's 2008 presidential campaign, said the average rate of healthcare cost increases has been less than half of the average in the previous 40 years. He attributed it to lowered annual Medicare payments to hospitals, home health agencies and private insurance plans--5 percent of the post-2010 slowdown.
The healthcare reform law also penalizes hospital readmissions, which has driven readmission rates in Medicare down 10 percent since 2011, Cutler writes, all while health systems maintain quality care and private plans experience a rise in enrollment. Accountable care organizations, which tout financial savings and show quality improvements, have also taken off, with approximately 250 ACOs accounting for 10 percent of Medicare beneficiaries.
Although the ACA is not the only factor in the healthcare cost slowdown, it is a crucial one. Cutler anticipates federal savings of more than $750 billion of the next 10 years if healthcare cost growth continues at this slower rate, according to the article.
Despite the cost slowdown, there are significant uncertainties about the healthcare reform law's effect on healthcare spending, including advances in medical technology, future policy decisions and the cost and availability of health insurance, FierceHealthcare previously reported.
To learn more:
- read the Washington Post article