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Health Reform: The Cost Of Failure
1. Prepared for the Robert Wood Johnson Foundation
John Holahan, Bowen Garrett, Irene Headen, and Aaron Lucas
The Urban Institute
May 21, 2009
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2. Three Economic Scenarios
Worst case: Slow growth in incomes, high growth rates
for health care costs
Intermediate case: Somewhat faster growth in
incomes, but a lower rate of growth for health care costs
Best case: Return to full employment in 2014, faster
income growth, even slower growth in health care costs
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3. Increase in the Number of Uninsured
2009-2019
(in millions)
Intermediate Worst Case
70 Case 65.7
Best Case 62.2
60 57.0
Baseline
50 49.1
40
30
20
10
0
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4. Employer Spending on Premiums
2009-2019
(in billions)
Best Case Worst Case
1000 $885.1 2009
900 2014
800 $740.6 2019
700 $624.7
$572.9
600
500 $429.8 $429.8
400
300
200
100
0
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5. Change in Medicaid/SCHIP Spending for
Acute Care, Non Elderly
2009-2019
(in billions)
Best Case Worst Case
600 2009
$519.7
2014
500
2019
$403.8
400 $366.5
$320.4
300 $251.2 $251.2
200
100
0
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6. Change in Spending on Uncompensated
Care For the Uninsured
2009-2019
(in billions)
Best Case Worst Case
160 $141.4 2009
140 2014
$106.6 2019
120
100 $92.3
$81.0
80
$62.1 $62.1
60
40
20
0
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7. Medicaid/SCHIP Spending and Uncompensated Care
Costs as a Share of Income
2009-2019
(as percent of aggregate incomes)
Best Case Worst Case
7% 6.4% 2009
2014
6%
4.9% 2019
5% 4.4%
4.1%
4% 3.7% 3.7%
3%
2%
1%
0%
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8. Individual and Family Spending
2009-2019
(in billions)
Best Case Worst Case
600 $548.4 2009
$476.2 2014
500
2019
$416.9
$392.3
400
$326.4 $326.4
300
200
100
0
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9. Conclusions In all three scenarios:
Private coverage decreases
Public coverage increases
Number of uninsured soars
Public spending for
Medicaid/CHIP jumps
Cost of uncompensated care
rises
Employer spending on
premiums grows
Costs shift to workers through
lower wages
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10. But if we act, health reform Conclusions
can:
Cover more Americans
Stabilize the safety net
Make care more
affordable for families and
businesses
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11. This Slidecast is presented by the
Robert Wood Johnson Foundation
and the Urban Institute
For more information or to view the full report, go to
www.rwjf.org or www.urbaninstitute.org.
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