Cost and Coverage Implications of the Affordable Care Act

The ACA's goal of expanding access to health coverage has implications for health care costs at many levels: for individuals and families, for employers, for insurers, and for governments. In addition, the ACA contains provisions intended to restrain growth in health care costs:


RAND's analysis of the ACA's cost and coverage implications focuses on how implementation will affect individual decisions to obtain insurance, employer decisions about offering coverage, and government spending. For instance, some of our studies examine:

  • the impact of high-deductible plans on consumer use of health care
  • effects of the individual and employer mandates on coverage, spending, and cost shifting among employers and the state and federal governments
  • the impact of state-level decisions about expanding Medicaid eligibility
  • effects of proposed changes to Medicare

Much of our work uses COMPARE, a sophisticated microsimulation model, to estimate the ACA's likely effects on costs and coverage across various scenarios.

  • Blog

    Four Questions on Canceled Insurance Policy Fix

    David Mastio, Forum editor at USA TODAY, asked RAND's Christine Eibner four questions about President Obama's plan to fix the problem with people getting their insurance canceled.

  • Blog

    Quick Takes: Health Literacy and ACA Enrollment

    The Affordable Care Act (ACA) expands coverage to millions of Americans. But the newly eligible may face challenges enrolling if they lack understanding of how the health care system itself works. Laurie Martin explains the role of health literacy in determining how successful the ACA will be in providing coverage for America's uninsured.

  • Blog

    Quick Takes: The Math of Medicaid Expansion

    Expanding Medicaid under the Affordable Care Act (ACA) is both contentious and complicated. RAND mathematician Carter Price has been using the COMPARE model to help those making decisions understand what their choices mean for their budgets and population health.

  • Blog

    Understanding the Affordable Care Act

    One of the chief aims of the Affordable Care Act (ACA) is the expansion of insurance coverage to individuals who at present either cannot afford it or choose not to purchase it. Unfortunately, many Americans lack the financial literacy needed to navigate the numerous and complex options thrust upon them by the ACA.

  • Blog

    Ask Me Anything: Carter Price on the Affordable Care Act

    As of October 1, many Americans can now shop for health insurance through state exchanges created as part of the Affordable Care Act (ACA)—the sweeping health care reform often referred to as “Obamacare.” To provide some insight into the ACA, RAND's Carter Price hosted an “Ask Me Anything” session on Reddit today.

  • Report

    Affordable Care Act Will Reduce Out-of-Pocket Medical Spending for Many Americans

    The Affordable Care Act will have a varied impact on health spending by individuals and families, depending primarily on their income and whether they would have been uninsured in 2016 without the program.

  • Blog

    Will ACA Implementation Lead to a Spike in Demand for Care?

    The growing number of Americans newly-insured under the ACA will undoubtedly lead to a surge in demand for care, whether through Medicaid or insurance exchanges. But, if predictions hold, the increase won't be as dramatic as some may fear, writes David I. Auerbach.

  • Report

    Delaying the Employer Mandate Could Have a Big Cost in the Long Run

    The one-year delay in enforcing the Affordable Care Act's employer mandate will not have a substantial effect on insurance coverage—but it will lead to less revenue to offset the ACA's costs.

  • Blog

    Modeling the Effects of the Affordable Care Act in Arkansas

    The Medicaid expansion under the ACA will result in about 400,000 people newly insured in Arkansas by 2016. The state is likely to save about $67 million for reduced uncompensated care costs for the uninsured, and receive $430 million in federal funds. Wealthier states, however, will have a different experience.

  • Blog

    Health Care Costs Must Be Curbed, No Matter Who Wins

    Regardless of which candidate wins in November, and regardless of whether “Obamacare” is repealed, amended, or defended by the next Congress, the next president will have to contend with the spiraling cost of health care in the United States—a problem that is growing more acute with each passing year, writes Arthur Kellermann.

  • Journal Article

    Medicare Postacute Care Payment Reforms Could Improve Efficiency, But May Need Changes To Cut Costs

    The Affordable Care Act requires changes in payment policies for Medicare postacute care services intended to contain spending and help ensure the program's financial sustainability. Policymakers will need to monitor the reforms' impact and amend policies as necessary to ensure that spending is controlled without compromising the service delivery.

  • Blog

    Will More Employers Drop Coverage Under the ACA? Don't Bet on It

    A problem with using surveys to predict behavior is that they measure employer sentiment toward the ACA today, rather than the economic decisions employers typically make when the time comes, writes Art Kellermann.

  • Research Brief

    Consumer-Directed Plans Could Cut Health Costs Sharply, but Also Discourage Preventive Care

    Switching to a consumer-directed health plan (CDHP) could save families 20 percent or more on their health care costs. Families with CDHPs initiate less episodes of care and spend less per episode, however, they also tend to scale back on high-value preventive care, such as child vaccinations.

  • Research Brief

    How Will the ACA Affect Employee Health Coverage at Small Businesses?

    The Affordable Care Act will likely increase the probability that small businesses will offer health coverage to their employees, especially for firms with 50 or fewer workers. This will be a result of increased individual demand for insurance, since there is a penalty associated with being uninsured under the new law.

  • Journal Article

    Rules Allowing Small Businesses to Opt Out of Health Reform Should Have Minor Impact on Insurance Cost

    An analysis of two rules that allow small businesses to avoid participating in health reform concludes they will have only a minor impact because relatively few businesses are likely to take advantage of the options.

  • Research Brief

    How Will the Affordable Care Act Affect Costs and Coverage?

    Researchers simulate how the coverage-related provisions of the Affordable Care Act will affect health insurance coverage, and state spending on health care in California, Connecticut, Illinois, Montana, and Texas.

  • Blog

    Supporting Comprehensive Healthcare for Women Makes Dollars, and Sense

    As we look for ways to provide efficient, high-quality, and cost-effective health care to more Americans, we can't afford to ignore women's health issues, including reproductive health care and the cost savings that contraceptive access provides, writes Chloe Bird.

  • Periodical

    The Fate of ACA Is a Major Issue in Upcoming Congressional and Presidential Elections

    Whether the Affordable Care Act is repealed, defended, or weakened will hinge on who holds the balance of power next January. Regardless of what happens with the ACA, the spiraling cost of health care in the United States will remain a huge challenge.

  • Blog

    Time to Shift Talk to Health Care Costs

    The U.S. Supreme Court's ruling on the Affordable Care Act is unquestionably historic, but there is a critical aspect of health care reform that still needs to be fixed. The nation needs to take decisive action to address the rising costs of health care, writes Arthur Kellermann.

  • Blog

    Will the Affordable Care Act Make Health Care More Affordable?

    Out-of-pocket spending on health care will decrease for both the newly insured as well as for those changing their source of insurance. These decreases will be largest for those who would otherwise be uninsured.