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The Economic and Medical
Benefits of the Affordable
Care Act on the American
Population
Submitted by:
Saba Rehman
Submitted on:
December 4th
, 2014

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Abstract
The Affordable Care Act, also known as the Patient Protection and Affordable Care Act, is a
federal law passed by the United States Government on March 23rd, 2010 by President Barack
Obama. Since it has been passed, many changes have been made to it and new laws and
regulations have been added in order to improve it. In 2014, all Americans had access to the
revised affordable health insurances and were mandated to be covered with some sort of health
coverage. Moving into the second year of enrollment for this act, it is extremely prudent for the
American population to know the facts and the changes made.
Although there have been numerous speculations about the act and what the disadvantages of it
are, it is important to stay on the positive sides of such situations. The Affordable Care Act has
little to no effect on the upper class and large businesses; therefore, its main goal is to help the
millions of Americans that are uninsured. It is more important to help the poor and lower class
population, than it is to help the people who already have the money and resources to afford a
healthy lifestyle. The Affordable Care Act, also given the nickname of “Obamacare”, aims to not
only bring down the cost of healthcare, but also improve the quality of it.
Amid the arguments on social media and national news channels about the Affordable Care Act,
it is important for an average citizen to know the truthful facts about the law. The consumer of
the healthcare has the right to be aware of its pros and cons. Fortunately, there are more
advantages provided from the act, than disadvantages. Among the numerous blessings of the
Obamacare, the two most important ones revolve around the improvement it has had on the
economic and medical aspects of the United States healthcare system.

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Table of Contents
Abstract ………………………………………………………………………………………. 1
Table of Contents ……………………………………………………………………………. 2
Table of Figures ……………………………………………………………………… 2
Introduction ………………………………………………………………………………….. 3
What is the Affordable Care Act? …………………………………………………….. 3
Why Make Changes to the United States Healthcare System? ………………………... 4
The Economic Benefits of the Affordable Care Act …………………………………… 6
The Medical Benefits of the Affordable Care Act ……………………………………... 8
Literature Review ……………………………………………………………………………. 11
What is the United States Government Doing to Help Spread the Word? ……………. 11
How Can a Family Sign Up for Obamacare? …………………………………………. 11
Findings ……………………………………………………………………………………….. 13
How Does the American Population Feel About the Act? …………………………….. 13
Is the Act Successful in Making Changes? …………………………………………….. 14
Discussion ................................................................................................................................... 15
References …………………………………………………………………………………….. 16
Table of Figures
Figure 1: Uninsured people, with or without health reform …………………………………... 4
Figure 2: 2012 Cost per Hospital Bed ………………………………………………………… 5
Figure 3: U.S. Healthcare spending as a percentage of GDP, 1960-2010 ……………………. 6
Figure 4: People reporting better health are more likely to be employed ……………………... 8
Figure 5: Health Reform Benefits Americans …………………………………………………..10

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Introduction
What is the Affordable Care Act?
The Affordable Care Act is the new healthcare reform law passed on March 23rd, 2010 by the
Obama Administration in the United States. It has been given the nickname of Obamacare in
many states by many Americans. Although it is a very long piece of legislation with many
sections, which many Americans may not take the time to read thoroughly, it is important to be
aware of the basic goals and regulations. In simple words, its goal is to provide more Americans
with affordable, quality health insurance and at the same time curb the growth in healthcare
spending. Despite all the people against the law, Obama fought for his ultimate healthcare reform
plan and is currently working hard to execute it to the fullest. It is crucial for the American
citizens to understand the benefits that arise from this law and how it can truly change the
healthcare system of the United States. It is not only suppose to help increase the quality of
healthcare, but it is also predicted to help improve the current state of the economy. With the
new benefits, rights and protections listed under the new law, no American with health insurance
will face the manipulations of healthcare and insurance industries again.
A new idea or word that is introduced in the law is called “The Exchanges” which can simply be
described as a shopping mall or an insurance marketplace. It is a state-level insurance
marketplace where people have the liberty to decide which insurance company is best suitable
for their family. The exchanges offer four levels of coverage: platinum, gold, silver and bronze.
While the estimated coverage for the platinum level is 90%, the bronze level only covers
approximately 60% of the medical costs. Most insurance companies are participating in the
exchanges, but others are waiting to see if it is the right decision for them regarding loses and

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profits. Insurance costs on the exchanges will not only vary from state to state, but also within
states. Additionally, many people have questions about the affect of the Affordable Care Act on
people who already have insurances. The answer to this is simple. The changes made by the law
will mainly affect the ones that are uninsured, self-employed, small businesses, and employees of
businesses that do not provide or decide to drop insurance coverage.
Why Make Changes to the United States Healthcare System?
During the 2008 elections, healthcare reform was a heated topic in the Democratic platform.
Despite the Republican Party’s 50 failed attempts to repeal the Act, the law was passed in 2010.
Unfortunately, there were many Americans who did not even understand, and still probably
Figure 1: Source: The Washington Post
This graph is showing the expected percentage of decrease in uninsured people in the United States with the
health reform in place over the next decade.

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don’t, why it is so crucial to reform the healthcare system. The healthcare system cost Americans
around 2.8 trillion dollars in 2013 and is expected to keep growing every year. It is too early to
conclude if Obamacare is enough to solve all the nation’s healthcare problems and bring down
the costs; however, it is definitely one step closer to a solution. If the act is implemented
effectively and if the Americans continue to fight for their healthcare rights, then a true
transformation in the United States healthcare system can be achievable.
So what exactly is causing the healthcare system to go out of control? Although there are a
number of reasons behind it, a few important ones include a growth in personal debt or
bankruptcy that Americans face due to unpaid, expensive medical bills, the increasing costs of
healthcare and the greed of healthcare corporations to make increasing profits. American health
Figure 2: Source: International Federation of Health Plans
This graph shows the cost of hospital visit per day in different countries worldwide. United States has one of the highest hospital daily visit
costs worldwide and it far exceeds the price of other countries comparatively. This shows just how expensive the United States healthcare
system can be.

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insurance companies are the greediest corporations who are constantly looking for ways to make
profits. They are a huge reason behind the increasing costs of healthcare since it means more
profit for them. This is mostly because the government does not set the price of health insurance;
private for profit organizations who look forward to raising premiums every year set it. Most
Americans do not have an alternative and are forced to accept the increasing rates. However,
Obamacare does help keep insurance affordable for the low and middle income Americans
which brings down the number of uninsured people in the nation overall. The Affordable Care
Act is not an overnight solution to a problem that has been haunting our nation for years;
however, with its set of new medical and economic benefits, it can help eliminate some of the
major problems.
]
The Economic Benefits of the Affordable Care Act
In the beginning of 2014, the Congressional Budget Office analyzed the economic benefits of the
Affordable Care Act. The analysis refuted the claims of many opponents of the act and proved
that it will help families and allow people to take business risks. The analysis confidently states
Figure 3: Source: OECD
This line graph shows the
increase in US healthcare
spending over the course of five
decades. It has only been
increasing since 1960 with no
signs of improvement or
decrease.

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that the Affordable Care Act will aim to help the labor market, lay the foundation for future
economic growth and improve families’ financial security and well-being. It is no secret that an
economy is mostly all about supply and demand, which also plays an important role in a
company’s profits and losses. Therefore, since the Affordable Care Act makes it easier for
families to have access to healthcare services and other needs, the demand for goods and services
increases throughout the economy. This allows the unemployment rate to go down by ensuring
that almost every American, especially in the health professional field, can find a job. More
demand, means more supply needed. In this case, the demand is quality, affordable healthcare
and the supply is the healthcare professionals who are able to fulfill the on growing demand.
In some ways, the medical benefits overlap with the economic ones. Since the act focuses on
improving the health of people, it stresses the importance of improving the quality and efficiency
of care in medical facilities. For example, hospitals are given incentives to reduce the number of
patients returning to the hospital after discharge. Through providing higher-quality care during
the initial visit, the number of patients returning for care reduces which also lowers the
healthcare cost. Besides lowering the healthcare costs, another advantage is that people will live
longer, healthier lives and miss fewer days at work. They will also be less likely to become
disabled and spend more time being employed. All of this leads to a healthier economy, healthier
citizens and a smaller unemployment rate.
An additional economic benefit gained from the affordable care act is that it does not matter if a
person is employed or not to receive health insurance. Everyone is covered in some way or
another! All Americans have secure access to health insurance, whether or not they can get
coverage through their workplaces. This allows people to choose any careers they want, retire
when they want, and even take a break for personal reasons whenever they want without having

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to worry about health insurance coverage. This also allows people to take risks with their careers
and businesses and even encourage entrepreneurship, which allows job creation and economic
growth. Security of access to health insurance increases work mobility among American citizens
which in turn helps improve the economy.
Furthermore, the Affordable Care Act stresses on the idea that most American citizens will no
longer have to choose between their health and their financial security. In almost every American
family, financial security is risked during a time of long-term illness or disease. This frequently
leads to something commonly known as healthcare debt or bankruptcy. Fortunately, expanding
access to affordable health insurance coverage, the act ensures that getting sick no longer means
financial ruin. Better financial protection leads to an overall healthier national economy.
The Medical Benefits of the Affordable Care Act
Figure 4: Source: CEA Tabulations of the March 2013 Current Population Survey
This bar graph shows the correlation between the health status of the American population and the percent that are employed.

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The medical benefits under the Affordable Care Act are numerous and ones that can truly help
improve an individual’s health. To start of with, no one can be turned down for insurance due to
a preexisting condition. In the past, many health insurance companies hesitated in providing
coverage for an individual who had a specific lifetime illness or disease. Or insurance companies
would deliberately make the premium costs extremely high where it was impossible for someone
to even afford it. Additionally, there are no longer any annual or lifetime caps on overage. All in
all, the unhealthy will pay the same amount as those who are healthy. This has almost never
generally been the case. This is turning out to be both a medical and economic benefit for many
Americans.
Another medical benefit that arises from the act is that it is mandatory for all insurance plans to
provide free preventive care services, which includes yearly checkups and vaccinations.
Additionally, there are ten general categories of health benefits that every health plan must
include and cover. Hospitalization, laboratory services, maternity and newborn care, mental
health services, pediatric services and rehabilitative services are just some of the few health
benefits that are mandatory for all insurance companies to cover to some extent. The Affordable
Care Act is applauded, especially by the public health officials, for its inclusion of 100%
coverage for preventive care which includes a handful of screenings. In the field of public health,
it is constantly repeated how crucial preventive care is for the population since it can detect or
even avert future chronic diseases and illnesses. Screenings included under the act are cancer
screenings, adult depression screening, blood pressure screening, HIV screening and so much
more. These health benefits will lead to a healthier society.
It has been proven in the past by many countries that greater access to healthcare, especially as a
result of being insured, can reduce mortality, improve mental health and improve self-reported

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health status. The Affordable Care Act is aiming towards achieving the same results as other
successful countries with extraordinary healthcare systems. Moreover, young adults are now
allowed to stay on their parents’ insurance plans until the age of 26. This is great news for young
adults who were kicked off insurance plans in the past and left uninsured. Adolescents and young
adults are the core of our future generation and it is important to provide as many health services
as possible to them to keep them healthy.

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Literature Review
What is the United States Government Doing to Help Spread the Word?
Just recently, the enrollment period for Obamacare for the year 2015 began. Although the
number of Americans who signed up for affordable healthcare last year was astounding,
President Obama’s goal is to continue increasing these numbers in the upcoming year. For this
reason, on November 15th, 2014, when the enrollment period began, he mentioned the
importance of signing up for affordable healthcare in his weekly address to the country. He
emphasized that over the past one year more than 10 million Americans have gained financial
security and peace of mind that comes with health insurance. Furthermore, more than seven
million Americans enrolled in affordable healthcare by simply visiting healthcare.gov or by
visiting nearby marketplaces in their states. In his weekly address, he emphasized the need to
spread the word about how affordable and easy this new health coverage can be for Americans if
they register on time and take advantage of it. President Obama urged the public to inform and
educate their friends, family, neighbors, and even classmates about the simple insurance
coverage process. The government is spending a significant amount of money on media
advertisements to help spread the word about the short three months period available for people
to enroll in the affordable coverage. The president himself is making a generous effort to inform
Figure 5: Source: WH.GOV/HEALTHREFORM

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the American citizens and is motivating them to enroll through sharing personal stories shared by
other Americans.
How Can a Family Sign Up for Obamacare?
It is important for every American citizen to be aware of the economic and medical benefits that
this law can provide to their family. When signing up for Obamacare, it is essential to keep a few
facts in mind. First of all, the entire system is based off of income qualifications and tax returns.
Therefore, when or if someone gets married or divorced, it can affect their subsidies and the cost
of healthcare. Sometimes it can be beneficial, but sometimes it could be detrimental.
Additionally, where a person resides in the United States will become crucial in determining
their healthcare costs. This is because each state has its own health insurance coverage costs, as
well as each city within the states. Some treatment coverage for certain diseases may be cheaper
in certain states.
There are a few ways to sign up for Obamacare: calling 1800-318-2596 or going online on
healthcare.gov. The Obama administration spent the last one year improving the website and
making it easier and faster to use. There are new options available every year which may help
families save even more money and fit family needs more accurately.

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Findings
How does the American Population Feel About the Act?
When the act was first passed, many Americans were surveyed around the nation to collect their
input and opinions. A popular answer was that many did not feel they had enough information
about the law to know how it would affect their families. This is where most of the problem
arises from, when individuals are not well informed about an important change taking place in
their country. When some did take the liberty to educate themselves and read through the basic
facts, they were not fully pleased. Some pointed out that it does not guarantee access to care.
Meaning, the act is not a definite answer to the number of medical facilities and professionals
available to people. Others pointed out that it does not control medical costs. There is actually no
real rate control on the federal level; however, the states have some sort of control and can
dictate the prices.
Another concern that many Americans have about the act is that the law makes it mandatory for
every citizen to have health insurance. Although it is an amazing step towards decreasing the

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number of uninsured Americans, as well as beneficial for the public health system, many citizens
do not fully understand the positive affects this could bring into their future. The economic and
medical benefits are present; however, require some analysis of the act to fully understand the
extent of it. Unfortunately, part of the law contains a penalty that can be charged if a family or
individual chooses not to have any form of health insurance. The amount of penalty goes up each
year and it depends either on the household income or on an individual basis.
One of the biggest misconceptions that many individuals have about the law is that they are free
to sign up for insurance anytime. However, that is not true at all. There is an open enrollment
period to sign up for “Obamacare” each year. During this enrollment period, a family or an
individual can provide the necessary tax and income information and pick a suitable health
insurance provider for them. The Affordable Care Act has numerous benefits, as stated earlier,
and it is wise to take advantage of it.
Is the Act Successful in Making Changes?
Like every reform or act, Obamacare has a few flaws and glitches; however, it is important to
look at the bigger picture and all that it has done so far, in just one year. Covering large numbers
of the uninsured was Obamacare’s primary goal. As the year comes to an end, statistics show
that the number of people uninsured fell by around 10-12 million. Recently, CDC conducted a
report in which the largest decrease in the uninsured rate was recorded among young adults, ages
19-25, from 19.8% in 2013 to 14.9% in the first quarter of 2014. There are a handful of reasons
behind why such a huge decrease in numbers was possible. Expansion of Medicaid, young adults
(under the age of 26) being allowed to stay on their parents’ plan, and access to subsidies are just
few of the reasons. Additionally, premiums inside the marketplaces are barely rising and

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participation of more insurance companies is rising. Overall, the two major goals of the act that
Obama wanted to achieve were met just half way through the year. More Americans have health
insurance now and the growth of healthcare costs is down. All in all, The Affordable Care Act is
a successful step in the right direction and the upcoming year is expected to bring even more
successes.
Discussion
It has been over four years since the healthcare reform act, also known as the Affordable Care
Act, was passed by President Obama in the United States. Since then, there have been many
supporters and disapprovals of the law. Despite all the efforts made by the opponents to shut
down the reform, it is still thriving today and truly making a difference. A difference that the
United States healthcare system has needed for a very a long time now. This is all possible due to
the numerous benefits that come along with the act. These benefits not only include ways to
improve the falling economy, but also medical benefits that will help improve American health
lives.
In 2014, the Wall Street analysts and healthcare experts stated that the law helped industry
financially by providing new customers to insurers and new paying patients to hospitals. This is
just one of the few financial benefits that the law provides to the nation’s economy. Along with
economic benefits that will help this country out of recession, there are medical benefits as well.
The medical benefits include free preventive care, screenings and accessibility to better quality
healthcare. In the beginning, President Obama had set two straight goals in his mind: affordable
healthcare that will bring down the number of Americans who are uninsured and improved

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quality of healthcare. Through vigorous effort made by the President himself and his
administration, the recent statistics and data for 2014 show that he was able to achieve them
both. The upcoming year for the Affordable Care Act looks promising; although, there is still no
guarantee that the challengers have been satisfied yet.
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Web. 01 Dec. 2014.
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Mar. 2013. Web. 01 Dec. 2014.
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Folger, Jean. "Essential Health Benefits Under The Affordable Care Act." Forbes. Forbes
Magazine, 11 Oct. 2013. Web. 01 Dec. 2014.
Furman, Jason. "Six Economic Benefits of the Affordable Care Act." The White House. The
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"Get 2015 Health Coverage Now. Health Insurance Marketplace." HealthCare.gov. USA.gov,
2014. Web. 03 Dec. 2014.
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Miller, Jake. "Obama: "Spread the Word" on Obamacare Enrollment." CBSNews. CBS
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2014.
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