Impact of the Affordable Care Act in Alabama
Hundreds of thousands of Alabamians have gained coverage, and millions more have had their coverage substantially improved
Today, the U.S. Department of Health and Human Services released an extensive compilation of state-level data illustrating the substantial improvements in health care for all Americans over the last six years. The data show that the uninsured rate in Alabama has fallen by 31 percent since the Affordable Care Act (ACA) was enacted in 2010, translating into 215,000 Alabamians gaining coverage. And, in addition to residents who would otherwise be uninsured, millions more Alabamians with employer, Medicaid, individual market, or Medicare coverage have also benefited from new protections as a result of the law.
“As our nation debates changes to the health care system, it’s important to take stock of where we are today compared to where we were before the Affordable Care Act,” said Secretary Sylvia M. Burwell. “Whether Alabamians get coverage through an employer, Medicaid, the individual market, or Medicare, they have better health coverage and care today as a result of the ACA. Millions of Americans with all types of coverage have a stake in the future of health reform. We need to build on our progress and continue to improve health care access, quality, and affordability, not move our system backward.”
Highlights of today’s data release include:
Employer Coverage: 2,545,000 people in Alabama are covered through employer-sponsored health plans. Since the ACA was enacted in 2010, this group has seen:
- An end to annual and lifetime limits: Before the ACA, 1,566,000 Alabamians with employer or individual market coverage had a lifetime limit on their insurance policy. That meant their coverage could end exactly when they needed it most. The ACA prohibits annual and lifetime limits on policies, so all Alabamians with employer plans now have coverage that’s there when they need it.
- Young adults covered until age 26: An estimated 35,000 young adults in Alabama have benefited from the ACA provision that allows kids to stay on their parents’ health insurance up to age 26.
- Free preventive care: Under the ACA, health plans must cover preventive services — like flu shots, cancer screenings, contraception, and mammograms – at no extra cost to consumers. This provision benefits 2,140,837 people in Alabama, most of whom have employer coverage.
- Slower premium growth: The average premium for Alabama families with employer coverage grew 5.2 percent per year from 2010-2015, compared with 7.1 percent over the previous decade. Assuming Alabama premiums grew in line with the national average in 2016, family premiums in Alabama are $2,200 lower today than if growth had matched the pre-ACA decade.
- Better value through the 80/20 rule: Because of the ACA, health insurance companies must spend at least 80 cents of each premium dollar on health care or care improvements, rather than administrative costs like salaries or marketing, or else give consumers a refund. Americans with employer coverage have received more than $1 billion in insurance refunds to date.
Medicaid: 910,775 people in Alabama are covered by Medicaid or the Children’s Health Insurance Program, including 645,400 children and 86,609 seniors and people with disabilities covered by both Medicaid and Medicare. The ACA expanded Medicaid eligibility and strengthened the program for those already eligible.
- 177,000 Alabamians could gain coverage: An estimated 177,000 Alabamians could have health insurance today if Alabama expanded Medicaid under the ACA. Coverage improves access to care, financial security, and health; expansion would result in an estimated 20,000 more Alabamians getting all needed care, 25,200 fewer Alabamians struggling to pay medical bills, and 210 avoided deaths each year.
- Up to 85,000 Alabamians with a mental illness or substance use disorder could get help: 85,000 Alabamians, or an estimated 30 percent of those who could gain Medicaid coverage through expansion, have a mental illness or substance use disorder.
- Alabama could be saving millions in uncompensated care costs: Instead of spending $190 million on uncompensated care, which increases costs for everyone, Alabama could be getting $1 billion in federal support to provide low-income adults with much needed care.
- Children, people with disabilities, and seniors can more easily access Medicaid coverage: The ACA streamlined Medicaid eligibility processes, eliminating hurdles so that vulnerable Alabamians could more easily access and maintain coverage.
- Alabama is improving health care for individuals with chronic conditions, including those with severe mental illness: The ACA established a new Medicaid flexibility that allows states to create health homes, a new care delivery model to improve care coordination and lower costs for individuals with chronic conditions, such as severe mental illness, Hepatitis C, diabetes and heart disease.
Individual market: 165,534 people in Alabama have coverage through the Marketplace. Individual market coverage is dramatically better compared to before the ACA:
- No discrimination based on pre-existing conditions: Up to 2,040,458 people in Alabama have a pre-existing health condition. Before the ACA, these Alabamians could have been denied coverage or charged an exorbitant price if they needed individual market coverage. Now, health insurance companies cannot refuse coverage or charge people more because of pre-existing conditions.
- Tax credits available to help pay for coverage: Before the ACA, only those with employer coverage generally got tax benefits to help pay for health insurance. Now, 152,206 moderate- and middle-income Alabamians receive tax credits averaging $310 per month to help them get covered through HealthCare.gov.
- Women pay the same as men: Before the ACA, women were often charged more than men just because of their gender. That is now illegal thanks to the ACA, protecting roughly half the people of Alabama.
- Greater transparency and choice: Before the ACA, it was virtually impossible for consumers to effectively compare insurance plan prices and shop for the best value. Under the ACA, Alabama has received $1 million in federal funding to provide a more transparent marketplace where consumers can easily compare plans.
Medicare: 989,855 people in Alabama are covered by Medicare. The ACA strengthened the Medicare Trust Fund, extending its life by over a decade. In addition, Medicare enrollees have benefited from:
- Lower costs for prescription drugs: Because the ACA is closing the prescription drug donut hole, 90,556 Alabama seniors are saving $97 million on drugs in 2015, an average of $1,075 per beneficiary.
- Free preventive services: The ACA added coverage of an annual wellness visit and eliminated cost-sharing for recommended preventive services such as cancer screenings. In 2015, 531,567 Alabama seniors, or 74 percent of all Alabama seniors enrolled in Medicare Part B, took advantage of at least one free preventive service.
- Fewer hospital mistakes: The ACA introduced new incentives for hospitals to avoid preventable patient harms and avoidable readmissions. Hospital readmissions for Alabama Medicare beneficiaries dropped 6 percent between 2010 and 2015, which translates into 1,503 times Alabama Medicare beneficiaries avoided an unnecessary return to the hospital in 2015.
- More coordinated care: The ACA encouraged groups of doctors, hospitals, and other health care providers to come together to provide coordinated high-quality care to the Medicare patients they serve. 9 Accountable Care Organizations (ACOs) in Alabama now offer Medicare beneficiaries the opportunity to receive higher quality, more coordinated care.