r/FluentInFinance • u/The-Lucky-Investor • 11d ago

“Medicare for All” would save the U.S $5.1 Trillion over 10 years Discussion/ Debate

https://www.commondreams.org/news/2018/11/30/easy-pay-something-costs-less-new-study-shows-medicare-all-would-save-us-51-trillion
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u/GeekShallInherit 11d ago

From 1998 to 2013 (right before the bulk of the ACA took effect) total healthcare costs were increasing at 3.92% per year over inflation. Since they have been increasing at 2.79%. The fifteen years before the ACA employer sponsored insurance (the kind most Americans get their coverage from) increased 4.81% over inflation for single coverage and 5.42% over inflation for family coverage. Since those numbers have been 1.72% and 2.19%.

https://www.kff.org/health-costs/report/employer-health-benefits-annual-survey-archives/

https://www.cms.gov/Research-Statistics-Data-and-Systems/Statistics-Trends-and-Reports/NationalHealthExpendData/NationalHealthAccountsHistorical.html

https://www.bls.gov/data/inflation_calculator.htm

Also coverage for people with pre-existing conditions, closing the Medicare donut hole, being able to keep children on your insurance until age 26, subsidies for millions of Americans, expanded Medicaid, access to free preventative healthcare, elimination of lifetime spending caps, increased coverage for mental healthcare, increased access to reproductive healthcare, etc..

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u/[deleted] 10d ago

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u/interzonal28721 10d ago

All I got from aca was a high deductible plan

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u/GeekShallInherit 10d ago

Deductibles were increasing faster before the ACA than after as well. And, of course, you likely got access to an HSA now with a high deductible plan, which is pretty much the best investment opportunity in the country.

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u/Old_Height_8351 10d ago

Thanks for taking the time to put numbers to this.

While the % may have decreased, the absolute values (amount of money spent on healthcare) are much larger so the percentage is misleading. 2.79% of a trillion is about the same at 3.92% of 800bil. I’m no so sure the decreased percentage is due to the bill or just because the amount we spend is just insane. I could be wrong tho

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u/GeekShallInherit 10d ago

the absolute values (amount of money spent on healthcare) are much larger so the percentage is misleading.

Except they aren't when healthcare spending has had a greater than 100 year history of increasing exponentially. Even then you're wrong. Just looking at inflation adjusted spending, single premiums increased $2,074 and family premiums $7,283 in the decade before the ACA went into effect; and $791/$2,727 in the ten years after the law went into effect.

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u/Old_Height_8351 10d ago

Thanks for clarifying the premium portion. You have a good point there.

I’d be curious about the other portions like coinsurance, copayments and deductibles. It could be the case the insurance shifted costs to those things. They do want to make more money after all.

This is a very complex topic, so many things contribute to an increase in healthcare spending. General population health, insurance, regulation, labor, etc. We have so many problems it’s hard to know which way is up

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u/GeekShallInherit 10d ago

In 2003, the average employer provided single PPO plan was $3,505, with a deductible of $275. That's $5,771 and $453 adjusted for inflation.

In 2013, the average employer provided single PPO plan was $6,031 with a deductible of $799. That's $7,835 and $1,038 adjusted for inflation.

At the same rate of increase, the single PPO would have cost $10,636 in 2023 with a deductible of $2378.

In actually in 2023, the average employer provided single PPO plan was $8,096 with a deductible of $1,281. From 2003 to 2013 saw an average of 5.58% in premiums and 8.65% in deductibles after accounting for inflation. 2013 to 2023 saw an average increase of 1.30% and 2.13%.

And, of course, all of this is encapsulated in the total spending which I previously addressed.

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u/Old_Height_8351 10d ago

In summary, the ACA had an effect of reducing the % increase on insurance spending for employer sponsored plans. I think I’m interpreting that correctly.

Do you think the individual has an increased out of pocket expense? Such as coinsurance and copayment

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u/GeekShallInherit 10d ago

Do you think the individual has an increased out of pocket expense?

Deductibles have increased more slowly as well.

In 2003, the average employer provided single PPO plan was $3,505, with a deductible of $275. That's $5,771 and $453 adjusted for inflation.

In 2013, the average employer provided single PPO plan was $6,031 with a deductible of $799. That's $7,835 and $1,038 adjusted for inflation.

At the same rate of increase, the single PPO would have cost $10,636 in 2023 with a deductible of $2378.

In actually in 2023, the average employer provided single PPO plan was $8,096 with a deductible of $1,281. From 2003 to 2013 saw an average of 5.58% in premiums and 8.65% in deductibles after accounting for inflation. 2013 to 2023 saw an average increase of 1.30% and 2.13%.

And everything, including out of pocket spending, is included in the total spending I addressed above.

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u/Old_Height_8351 10d ago

Those numbers are factoring in coinsurance or copays, but that could be only a small amount to add to those totals

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u/GeekShallInherit 10d ago

If anything, additions such as max out of pocket and increased coverage for preventative care should have reduced such costs. Feel free to provide a single shred of evidence otherwise.

I can tell you total household spending on healthcare accounted for an average of 29.6% of healthcare spending in the decade before the ACA went into effect; 28% since.

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u/Old_Height_8351 10d ago

If you hit your deductible, it doesn’t mean your out of pocket expenses are 0 now. You could still have a coinsurance.

We can both agree we spend a lot on healthcare. The point of the article was to highlight how getting rid of insurance can reduce expenses. Maybe that’s true long term. I’m all for insurance companies not creating the barriers they do and increasing the price of healthcare. I also don’t think we’ll ever have Medicare for all so this is just an interesting thought experiment

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