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Health Spending

Health spending is often one of the areas where there are many generalizations made despite of the fact that it obscure numerous important details, such as who is spending what? Does a rise in overall spending signify that more people are down to using the healthcare system? And what does this indicate about the sustainability of the whole thing? There is a significant amount of data on enrollees into the ACA, and the Congressional Budget Office (CBO) has subsequently analyzed these and provided estimates dealing with the ways this would affect the economy.

Last month, CBO came out with projections like the ones it releases every year, on the cost of health insurance subsidies shouldered by the Federal government. Also reveled were analysis and projection of how enrollment is proceeding nationwide. The release projections include $660 billion in subsidy payments this year, rising to $8.9 trillion in the 2017 to 2026 period. These payments are funded by the general treasury, which comprises taxpayer money.

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Medicaid Expansion

CBO says the net cost of the Affordable Care Act provisions will rise to $136 billion over a decade, noting that this could be traced to an increasing number of people getting Medicaid coverage in that time. Under the standing provisions, states have the option to expand eligibility to patients whose annual income is up to 133 percent that of the Federally recognized poverty line, and the funding would be shared by the Federal and State governments. The average Federal input to Medicaid is 55 percent of yearly expenses. Although, is the state elects to ease Medicare eligibility to 133 percent of the poverty line, the federal government would reciprocate by footing the expenses in their entirety. After this year, that funding is scheduled to gradually drop to 90 percent of program costs by the year 2020.

Until now, 30 States and the District of Columbia have entered into the Medicare expansion group, which reflects in the swell of people getting coverage thee last four years. CBO’s predictions say that enrollment will continue rising for the next decade. Even in the States that remain outside this group, Medicaid has been receiving more enrollees, thanks to awareness and education about the benefits this poses for someone who is eligible for coverage. 15 million out of the 69 million projected enrollees will comprise people eligible for coverage solely because of the Medicaid expansion.