What are the economics of Affordable Care Act?

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P.S. - I'm interested in the economics and facts of the program, not the politics.)

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Good luck separating those two things.

It will drive up costs and thus premiums but it attempts to soothe the populace through back door price controls i.e. subsidies.

I work in healthcare admin at one of the largest hospitals in the country. I did a considerable amount of my undergrad and graduate work debating the pros and cons of nationalized healthcare.

There is a lot of misinformation and confusion about Obamacare. I notice a number of folks here blaming Obamacare for decisions their employers made. In many cases Obamacare has been a convenient excuse for employers to reduce their benefit expenditures on their employees.

The argument for nationalized healthcare is that the single payer system as it exists elsewhere is more efficient in terms of dollars spent to deliver care. This is an undeniable fact which is not up to debate. The data also suggests that people in countries with nationalized healthcare generally live longer than Americans so even quality is difficult to debate. Where the debate exists is whether or not nationalized care is as efficent in terms of timeliness and whether this will meet the expectations of America's immediate gratification oriented society.

Will Physicians and hospitals make less? The data from overseas says yes.

Will hospitals survive? We survived the DRA under Reagan and prospered and will do it again.

Will MD's bemoan Obamacare as driving MD's to quit medicine? Yes they will in spite of the fact that the 2013 graduating class of newly minted Physicians was the largest in American history and 2014 will pump out even more.

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I'm interested in the economics and facts of the program

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Frankly, so is every actuary in the industry.

Effects will be variable depending on industry, age, income and other factors. Economically the ACA is redistributional. In that sense it should have the much same effect as a progressive 10% corporate/personal income tax increase (~$200B/yr, $2T/10years). Under ACA, young healthy policy holders also shoulder an increased burden of older sicker patient costs.

Those businesses which cannot offload ACA costs to employees will take a hit. ACA adds costs directly with increased policy expense, and indirectly in dealing with regulations and penalties. As with any corporate tax, those costs, where possible, will be passed through. Could add another 2% or more to inflation, a near double in this market.

Health insurance carriers will be pressured. IMO, investment in that sector is at risk. ACA limits profitability via the 80% rule. It increases actuarial risk due to variance in young healthy participation. With fewer healthy members, costs will rise. Carriers' policy options are limited under the ACA, also rendering cost of coverage more expensive.

Hospitals, Clinics, and Medical personnel will be affected. How significantly, is anybody's guess. Hospital administrators remain in a quandary about revenue effects. Layoffs have commenced. Physicians are closing practices in favor of employment usually via hospitals. Economic effects via the medical industry? I'd guess, not much. Leadership transference from physicians to administrators and politicians is another thing entirely. Effects on the public will eventually be significant. My suspicion is hospitals and doctors will see little economic change when the dust settles.

Miscellaneous pockets include Big Pharma - winner. Med device makers - losers.

In general terms of healthcare sector performance and investment, track Medicaid expansion. There should be an inverse relationship between Medicaid growth and HC sector profitability.