An expected partial repeal of the Affordable Care Act will hit physicians’ bottom line, according to a new analysis from the Urban Institute.
Analysts using the vetoed January 2016 budget reconciliation bill as the basis for their projections estimate that the partial repeal could result in as many as 29.8 million Americans losing coverage through the elimination of the Medicaid expansion, the individual and employer mandates, and the insurance marketplace premium tax credits and cost-sharing reductions. In addition, there would be a surge in uncompensated care.
“The coverage losses would in turn decrease revenues for providers of all types,” the report states. “Providers’ variable costs would also decrease, but their fixed costs would not.”
The Urban Institute estimates that spending by insurers (public and private) and households on health care delivered to the nonelderly would decrease by $145.8 billion in 2019 and $1.7 trillion between 2019 and 2028.
The increase in the uninsured would cause a spike of $88 billion in uncompensated care ($26.4 billion in hospital care, $11.9 billion in physician office care, $33.6 billion in other services, and $18.0 billion in prescription drugs), reaching $1.1 trillion between 2019 and 2028. At the same time, federal funding for uncompensated care would increase no more than $3.2 billion in 2019 and no more than $35 billion from 2019 and 2028, analysts state.
“There is no clear source of funding for the remainder,” the report notes. “If federal, state, and local governments do not allocate more funding for this care, the financial burden would fall on health care providers. Large increases in unmet need for the uninsured are likely because the additional costs would require a fourfold increase in provider funding of uncompensated care from current levels.”
Congressional Republicans plan to use the budget reconciliation process to partially repeal the revenue generating aspects of the ACA, a process that allows the repeal to go through with a simple majority in the Senate. However, repeal of the health care reform law’s other parts would require at least 60 votes in the Senate, requiring at least eight Democrats to side with the Republican majority, assuming none in the majority go against the party.
The incoming Trump administration has signaled that it plans to maintain certain aspects of the ACA, including the ability for parents to cover children up to age 26 and the ban on denial of coverage for preexisting conditions.
Research for the report was funded by the Robert Wood Johnson Foundation .