ACA and the coming downturn

[william the wie]

As the size of the hit against consumption caused by the ACA is becoming more resolved it is fairly obvious 2014 will see a huge hit against the US economy but I am not sure the US will be the worst hit. The US is the consumer of last resort for the world with China, Japan and many other economies leveraged to the hilt to profit from US consumption and since leverage works both ways where will be the biggest disaster?

Thank you for responding.

 

[Freemason9]

How will implementation of the ACA affect total aggregate spending on U.S. health care? If you cannot provide a reasonable answer, I'll assume you don't know the subject material very well.

 

[william the wie]

Well the site will have to get up and start actually functioning before the data hardens. From the relatively few enlistees who have told their story so far it looks like a 3% hit against consumption but that figure could be lowball so I want to get my bets in before the various markets crash.

 

[protectionist]

Should be a massive increase due to the increase in people with coverage.

 

[Freemason9]

Should be a massive increase due to the increase in people with coverage.

You're using very poor logic.

NO health care under the U.S. system has ever been "free;" somebody has always borne the cost. ACA simply allocates funding across definable users. Given the new cost controls that will be put in place, there may be an aggregate decrease in health care costs.

In any event, there is no data anywhere that would suggest what you believe to be true.

 

[oldfart]

Should be a massive increase due to the increase in people with coverage.

You're using very poor logic.

NO health care under the U.S. system has ever been "free;" somebody has always borne the cost. ACA simply allocates funding across definable users. Given the new cost controls that will be put in place, there may be an aggregate decrease in health care costs.

In any event, there is no data anywhere that would suggest what you believe to be true.

OK folks, get out your pencils and let's reason this one out. The ACA should in the short run for a year or two provide a boost to demand. I assume hear that there is a pent-up demand for medical services which are not covered now that will be covered under ACA which people have been putting off, often for decades. That demand will put a strain on the health services industries but it's a lot better than putting everything off. In the long run the emphasis on free diagnostic and preventative services and the increase availability of health care will lower long-run costs. Medical problems will be detected earlier and treated earlier when costs are lower and outcomes better.

We are in this for the long run, nothing else makes sense. Health care costs are already decelerating in the past two years and the ACA contained a number of provisions that should boost that trend. For the folks who like their current group insurance consider this; your costs (and therefore your exploding premiums, higher deductibles and co-pays) are the direct result of inefficiencies in the medical delivery industries and the health care financing industry. You are paying the 23% of all health costs that go to processing claims; which usually means the hospital submits a bill, the insurer refuses to pay it on a crocked up reason, and they dance the dance while billing you for thousands of dollars until they sort it all out. This won't go away with ACA (it really only goes away with single-payer) but it gets better. Your costs also include a premium from providers to cover uncompensated care, which will be lowered.

So the big objectives are to lower the long-term growth path of health care costs and to make access to health care as close as we can get to universal. In the course of doing this we will probably for the first time provide consumers with enough information to make rational health care financing decisions and inject a dispute resolution element into the insurance company--insured relationship. This seems like a pretty big deal to me even if you never buy insurance through one of the exchanges.

 

[william the wie]

The reduction in costs expected, if realized, will reduce medical and related employment.

To the extent it is possible this unemployment will be exported.

Since there are no limits on insurance premiums, deductables and co-pays there are several possible outcomes nearly all of which are bad.

 

[expat_panama]

...To the extent it is possible this unemployment will be exported...

What's happening is health care work is moving offshore as medical tourism becomes a fast growing chunk of foreign trade. This year about a million Americans are seeing foreign doctors.

 

[Freemason9]

The reduction in costs expected, if realized, will reduce medical and related employment.

To the extent it is possible this unemployment will be exported.

Since there are no limits on insurance premiums, deductables and co-pays there are several possible outcomes nearly all of which are bad.

So, you're suggesting now that lowered health care costs would be a bad thing because it could create job loss?

Jeezus.

 

[william the wie]

The reduction in costs expected, if realized, will reduce medical and related employment.

To the extent it is possible this unemployment will be exported.

Since there are no limits on insurance premiums, deductables and co-pays there are several possible outcomes nearly all of which are bad.

So, you're suggesting now that lowered health care costs would be a bad thing because it could create job loss?

Jeezus.

No, I am saying it will not work as advertised and that will aid the movement to repeal.