Impact of ACA Repeal on Medicare

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The Affordable Care Act (ACA) included key changes to Medicare, including reductions in federal payments to Medicare Advantage plans as well as payment and delivery system reforms.  While the new Administration appears committed to repeal and replacing the ACA, it remains to be seen how repeal will impact the ACA’s Medicare provisions.  A new Kaiser Family Foundation issue Brief discusses the potential impact of repeal on Medicare spending, beneficiaries and other stakeholders.

Kaiser reports that the Congressional Budget Office estimates full repeal of the ACA would increase Medicare spending by $802 billion from 2016 to 2025.  The increase in spending would primarily be due to restoring higher payments to health care providers and Medicare Advantage plans.  As a result, Medicare beneficiaries could see higher premiums, deductibles and cost-sharing.

Repeal would also likely push up the anticipated insolvency date for the Medicare Part A trust fund.  Before the ACA was signed into law, it was projected the trust fund would not have enough money to pay for all Part A benefits starting in 2017; however, changes under the ACA extended the insolvency date out to 2028.

As discussions about repealing and replacing the ACA continue, lawmakers will need to consider the impact on Medicare and its beneficiaries.