Many early opponents of the Affordable Care Act (ACA), more commonly known as Obamacare, criticized the up-front costs. Although the overall cost is currently slated to amount to an estimated $1.2 trillion by 2025, this number doesn’t take into account the money that Obamacare is saving.
The major goal of the ACA has always been to provide Americans with access to affordable healthcare insurance. It does this in a number of ways: by regulating what insurance policies must cover, setting standards for care, lowering healthcare costs, reducing premiums, and ultimately reducing what both Americans and the government spend on healthcare annually.
Think of it like installing solar panels. It may cost $25,000 up front to put solar panels on your home. Or you might spend 20 years paying them off. Either way, afterward you’re going to have access to free energy for years to come, offsetting the initial expense.
The same basic principle applies to Obamacare. As the quality of healthcare improves and more Americans take advantage of preventive care options, the overall costs of healthcare in this country will continue to decline, saving everyone money and making for a healthier populace.
So how does it work? How exactly is Obamacare saving money now and in the long run? Here are a few things you should know.
Millions of Americans Now Receive Coverage
Obamacare is still in the process of rolling out, so there are still some Americans (or people in the country, at any rate) who are not insured. However, it is now estimated that 90% of Americans are insured at this point, which saves the country money.
How? What happens when uninsured, low-income individuals need medical care? Many eschew preventive care that could catch major problems early. They instead wait until health problems are so bad that they have no alternative but to seek expensive emergency care.
Without any money, these individuals may not receive the best care, and hospitals and government agencies swallow the costs, passing them on to taxpayers and paying customers. Obamacare has allowed for previously uninsured individuals (low-income families, those with pre-existing conditions, etc.) to take advantage of affordable health coverage and get the preventive and other care needed to remain healthy and well, in turn lowering associated costs.
Industry Regulations Should Continue to Reduce Costs
According to a report from the Urban Health Institute, there seems to be a strong correlation between Obamacare and lowered costs for healthcare spending, with projections for further savings to continue through 2019.
As more Americans utilize preventive care services that fall under mandatory coverage, healthcare needs should decrease. In addition, regulations require hospitals and other facilities to meet standards for care, including aftercare, to prevent further issues like infections, relapses, and so on.
Obamacare is also striving to regulate costs for services, especially for Medicare and Medicaid patients, essentially reducing expenses for insurance providers. All of these changes should continue to create a more affordable healthcare system across the board and show increasing returns even as spending on the ACA rollout wanes.