On April 27, the Commonwealth Fund released a brief estimating the affordability of health care for individuals receiving subsidized coverage through health reform’s health exchanges.  The brief projects household budgets, finding that health care will be affordable for the majority of those receiving subsidized coverage.  The authors estimate that only 10 percent individuals receiving subsidized coverage will be unable to afford premiums and moderate out-of-pocket (OOP) spending.  The brief concludes that OOP spending is the largest concern for policymakers seeking affordable health coverage.

From the report:

The Patient Protection and Affordable Care Act (Affordable Care Act) includes massive new subsidies to health insurance that are designed to make coverage more affordable for low-income families in the United States. Will they work? Will the Affordable Care Act live up to its name?

This study investigates that question using a budget-based approach to measuring affordability. Drawing from the Consumer Expenditure Survey, the nation’s largest representative survey of consumption expenditures, we assess how much “room” people have in their budget to pay for health care needs after paying for other necessities. We consider both premiums and out-of-pocket spending not covered by insurance, incorporating tax credits to premiums and cost-sharing subsidies for low-income populations.

Full Report: Will the Affordable Care Act Make Health Insurance Affordable? (PDF | 1.27 MB)

The Commonwealth Fund. (2011). Will the Affordable Care Act make health insurance affordable? Gruber, J. and Perry, I.