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White House: ACA Helping Economy, Slowing Health Care Spending

On Monday, the White House released new data -- as part of an effort to counter Republican criticism of the Affordable Care Act's effect on the economy and jobs -- showing the ACA has helped strengthen the U.S. economy and slowed the growth of health care costs, Reuters reports (Morgan, Reuters, 7/29).

Senior Administration Official Comments

During a background briefing with reporters, a senior administration official -- speaking on the condition of anonymity -- said there is no evidence that businesses are cutting back employees' hours to avoid the employer mandate. The official also dismissed claims that the ACA is responsible for shift from full-time to part-time employment, noting that less than 1% of employees who work between 30 and 34 hours per week, are employed by businesses affected by the law's coverage requirements and are uninsured (Reichard, CQ HealthBeat, 7/29).

Instead, the official attributed nearly 30% of the jump in part-time workers seen in the June jobs report to federal furloughs caused by the sequester's automatic across-the-board spending cuts, which went into effect earlier this year after Republicans and Democrats in Congress failed to reach a deficit-reduction deal. The official predicted that July numbers set to be released on Friday would show a similar increase in part-time workers resulting largely from the furlough of 650,000 Defense employees, not the ACA (Reuters, 7/29).

Meanwhile, the official also shared data that show consumer spending on health care increased by 1.1% in the 12 months ending in May, the slowest pace in nearly 50 years (Reuters, 7/29). He noted that since the ACA was passed in March 2010, the health care spending growth rate has continued to slow and in some categories -- such as hospitals, nursing homes and outpatient services -- the slowdown has accelerated (CQ HealthBeat, 7/29).

White House Blog Post Comments

In a related White House blog post, the Council of Economic Advisers Chair Alan Krueger wrote, "Data from across the economy -- covering consumers, government and private employers -- point to the same conclusion: health care cost growth has slowed" (White House blog post, 7/29).  He added, "The fact that the slowdown in cost growth reflects changes in both prices and utilization of medical care -- and that the slowdown is apparent in many different aspects of the health care system -- further suggests that structural changes are under way" (Reuters, 7/29).

Krueger touted the ACA as a contributing factor to the slowdown in health care spending, writing, "The law includes provisions intended to foster coordinated care, reduce preventable health complications during hospitalizations and promote the adoption of more efficient health information technology."

Krueger highlighted several changes that have taken place since the law went into effect, including:

  • A 1.9% reduction in hospital readmission rates among Medicare beneficiaries;
  • New payment methods being utilized by accountable care organizations that promote shared savings; and
  • Hospital incentive payments for better performance (Kennedy, USA Today, 7/29).
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