Summary by The Market Institute of an Urban Institute publication.
The publication of this summary does not constitute an endorsement of the positions presented.
The Urban Institute recently published a document outlining the reasons they believe the Affordable Care Act is not a “massive redistribution of wealth.” The Congressional Budget Office estimates that by 2019, the ACA’s Medicaid expansion will spend 0.9% of the Gross Domestic Product. In comparison, Medicare and Social Security costs 3.9% and 5.6, respectively. While the ACA is unquestionably a redistribution of some wealth, it is “modest in scope,” cliams the Urban Institue. Most ACA funding will come from recycled healthcare costs. Almost 75% of the money funneled to the ACA will originate from reimbursement cuts and and higher taxes and fees on providers and insurers. They claim that insurers will be better off financially because of the newly insured, but there will be some that suffer, especially those located in states that did not expand Medicaid. Shortfalls should be able to be absorbed by increased efficiency or reduced profits. Medicare benefits are set to be expanded, while the cuts to the program are mainly to the insurers and providers, thus very few Americans will actually be affected, according to the Urban Institute. In all, redistribution of wealth claims are highly exaggerated.
Full publication: http://www.urban.org/publications/413023.html
