Researchers Assert the ACA is Underfunded by $500 Billion

While the Affordable Care Act (ACA) has helped many uninsured Americans receive coverage over the last several years, researchers with the Urban Institute believe that the ACA still has a long way to go.

Linda J. Blumberg and John Holahan wrote in the report After King v. Burwell: Next Steps for the Affordable Care Act that the health law is essentially underfunded and they estimate that roughly an additional investment of $453 to $559 billion over 10 years will be necessary to ensure the long-term success of the ACA. However, due to the implementation of the health law, national health expenditures will now be $2.5 trillion less between 2014 and 2019.

They predict that enrollment numbers may start to decrease in the coming years as a result of high-cost premiums for low-income families as well as high-priced premiums for plans that require considerable amounts of cost sharing.

Ms Blumberg and Mr Holahan are also worried that many members might believe they don’t have the access to the care they expected because of sizable deductibles they cannot afford and will therefore drop enrollment. In addition, the authors report that the levels of cost-sharing and premium tax credits are un-proportional to a family’s realistic income level; as a result, the authors believe that there is significant evidence to suggest that with overall falling enrollment rates will come higher premiums.

“The ACA is an attempt to build on and fill the gaps between existing public programs and private insurance,” the authors wrote. “Maintaining as much as possible of the system that was already in place while correcting its central failings introduced considerable complexity into the health insurance system, and thus the changes require significant infrastructure development and maintenance to be successful in the long term.”

The report proposes a number of changes that can be done to fix some of the current ACA shortfalls many individuals are facing, of which includes a new subsidy schedule that would address affordability barriers for premium costs and out-of-pocket cost-sharing burdens. Among their many proposals, the authors also suggest methods that would eliminate the firewall between employer-sponsored insurance offers and nongroup marketplace eligibility for premium tax credits.

“While the cost of appropriate levels of investment in the law is significant, financing it is entirely feasible,” the authors added.