Good news on health care in 2014, but we’re still spending too much

Introduction

The end of the year is always a good time to reflect on what went right and what didn’t and to speculate about what might happen in the coming 12 months.

So let’s take a look at how the U.S. health care system changed in 2014—the first year of close-to-full implementation of Obamacare—and take note of what we need to address sooner rather than later as we get ready to ring in the new year.

There is plenty of reason to celebrate and, as you can imagine, the White House wants us to believe that we can thank the Affordable Care Act for all the good things that happened. While I’m willing to give the law its due, the reality is that, as written, it will never get us to universal coverage or do nearly enough to control health care costs. But first, some of the good news:

• As the number of newly insured Americans reached an estimated 9.7 million this year, the percentage of Americans without coverage fell to the lowest level it’s been in years. That’s according to the National Center for Health Statistics, which released data last Thursday showing that the percentage of uninsured Americans dropped from 14.4 percent in 2013 to 11.3 percent in the second quarter of 2014. The White House Council of Economic Advisors says that’s the largest drop in at least four decades. The last time so many people gained coverage in a single year was when the Medicare and Medicaid programs began enrolling folks in 1966. The current gains were made possible by provisions of the Affordable Care Act that make it illegal for insurers to turn down applicants because of pre-existing conditions, as well as the availability of federal subsidies that help millions of Americans with their premiums and out-of-pocket spending.
• Health care inflation has been tamed—at least for the foreseeable future. The big accounting firm PricewaterhouseCoopers (PwC) said earlier this year that health care inflation was expected to slow to 6.5 percent in 2014, a full point less than the 7.5 percent inflation rate for 2013. PwC attributes at least part of that decline to the Affordable Care Act and suggests the trend likely will continue throughout 2015 and probably longer. “Total spending will rise with the cost of caring for the newly insured,” the report said, “but the rate of growth, which is based on unit costs, should remain at some of the lowest levels since the government began measuring national health expenditures in 1960.”
• The health care disparity gap is finally narrowing. Research reported recently by the New England Journal of Medicine found that racial disparities were reduced in every one of 17 quality measures for heart attacks, heart failures and pneumonia between 2005 and 2010. Another study, by researchers at the Urban Institute, found that the health insurance disparity gap is also narrowing as a result of the Affordable Care Act. The Institute predicts the Hispanic uninsured rate will drop from 31 percent to 19 percent by 2016 while the uninsured rate for blacks will drop from 20 percent to 11 percent.

Those are all good reasons to cheer. But other studies indicate just how much more there is to do.

• Even with the slowing of health care inflation, the U.S. continues to spend far more per person than any other developed country. In fact, the U.S. spends two-and-a-half times more than the average of the 34 countries in the Organization for Economic Co-operation and Development. No other country comes close to spending almost 18 percent of gross domestic product (GDP) on health care, as we do. And numerous studies continue to show that America lags most of the other OECD countries in health care outcomes and metrics such as longevity and infant mortality.
• Even with the expansion of coverage, many Americans continue to face hurdles in accessing mental health services and dental care —despite the fact that Congress passed a mental health parity law six years ago. And while the ACA improves access to dental care for children, it does little for adults.
• Millions of Americans are still filing for bankruptcy because of medical debt, even though they have insurance. In 2015, families could be on the hook for $13,200 in out-of-pocket expenses before their coverage kicks in. That’s far more than many household budgets will allow.
• It’s not likely the ACA will ever get us to universal coverage. The government estimates that more than 30 million of us will still be uninsured even when the law is fully implemented.

In the coming year, I’ll be looking at what some states and the private sector are hoping to do to at least partially resolve some of these problems. So stay tuned. And happy holidays.

Wendell Potter is the author of Deadly Spin: An Insurance Company Insider Speaks Out on How Corporate PR is Killing Health Care and Deceiving Americans and Obamacare: What’s in It for Me? What Everyone Needs to Know About the Affordable Care Act.