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Deloitte: PPACA changes might breed more changes

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The Patient Protection and Affordable Care Act of 2010 (PPACA) could either cut enrollment in U.S. employer-sponsored group health plans just a little or cut it a lot.

Analysts at the Deloitte Center for Health Solutions have published PPACA forecasts based on those possibilities in report on what the U.S. health care system might look like in 2020.

Opponents of PPACA are still trying to repeal all or parts of the law or to block implementation.

The Deloitte analysts developed projections for eight scenarios.

In the first, the analysts assumed PPACA would work about as the federal government seems to expect.

In three other forecasts, the analysts assumed employers would be faster to drop coverage and send employees to buy coverage through the new PPACA health insurance exchanges or through the traditional individual health insurance market.

If PPACA works “as expected,” the individual and small group PPACA exchanges might provide coverage for about 40 million people in 2020, traditional individual health insurance plans might cover fewer than 5 million people, and traditional group health plan enrollment might drop to about 130 million, from about 150 million today, the analysts predicted.

In that scenario, the analysts said, only 2 percent of large employer and 5 percent of small employers would drop coverage.

The number of uninsured people could drop to 34 million, from 54 million.

In three other scenarios that depict “unintended consequences,”  as many as 25 percent of large employers and 50 percent of small employers could drop coverage, and the total number of people enrolled in traditional group plans could fall as much as 50 percent, the analysts said.

In that scenario, the number of people who get coverage through a PPACA exchange could rise to 60 million to 70 million, but the number of uninsured people could stay the same, because of the drop in group health plan enrollment.

If PPACA takes effect mostly as written, but without the provision imposing a tax on individuals who fail to own a minimum level of coverage, the outcome might be similar to the baseline forecast, but with the number of uninsured people being somewhat higher than it would if the mandate were in effect, the analysts said.

If Congress triples the taxes to be imposed on individuals who lack health coverage, the number of uninsured people could drop to 29 million, the analysts said.

The analysts said they think their model suggests that there may be pressure on Congress to use penalties or other steps to discourage employers from dropping health coverage.

States also might come up with new programs aimed at “young invincibles,” who might otherwise decide to go without health coverage and pay the tax for being uninsured if the tax stays at the level now included in PPACA, the analysts said. 

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