The short version of the Affordable Care Act (ACA), otherwise known as Obamacare, is that, while it intended to drive down health care costs by forcing more people into the risk pool and creating an online marketplace to find cheaper plans, average health insurance costs have gone through the roof.
I don't mean to spam, I'm just in the rabbit hole now :)
Based on your graph (would love a link to the data to be more precise), medicare spending (in 2024 dollars) per enrollee in 2010 was about $15,800, a 55% increase over 10 years since the beginning of the graph, from about $10,200 in 2000, at a compound annual growth rate of 4.5% per year.
From 2010 to 2024, it went from ~$15,800 to ~$16,600, or only a 5% increase in 14 years, at a compounded annual growth rate of just 0.4%. If from 2010 to 2024 growth continued at the 4.5% annual CAGR from before the ACA passed, 2024 costs would be a whopping $29,300.
You are correct that Medicare enrollees are more expensive. On average, older people get sick more and need care more than younger people. Additionally, one of the key parts of the ACA was to add protections for pre-existing conditions. Previously, if you had for example breast cancer, insurers could deny you coverage. This meant that sick people were uninsured completely, through no fault of their own. Coverage for sick people is definitely higher than coverage for healthy people, but we should want all people covered. Insurance is a collective bargain - you never know when you're going to get sick.
The more important chart is the annual change in expenditures one as it shows the consistent decline in expenditures per person prior to ACA passage and a distinct upswing in 2014 when major provisions of the ACA went into effect.
That is a fair point to note that Medicare recipients are older and tend to use more healthcare (although certain metrics are also including Medicaid, which should not have the same scale of costs), but the extremely high costs of healthcare in the U.S. make those numbers worthy of some skepticism. Rather than leveraging markets and pools to limit costs, the ACA may have effectively spread the burden of additional fraud, waste, and abuse.
"the annual change in expenditures one as it shows the consistent decline in expenditures per person prior to ACA passage"
he number on that graph is greater than $0 for 2000 to 2014, except 2013. This indicates that the cost was increasing every single year from 2000 to 2012 and then went down 2012 to 2013 and then increased again 2013 to 2014. This is not a decline in expenditures, it is an increase in expenditures. The graph *does* show that the increase in expenditures was slowing. From 2014 to 2018 though, the increase year of year is lower than the average 2000 to 2014.
"Rather than leveraging markets and pools to limit costs..."
Why did I stop at 2018? 2019 is relevant here because in 2019 the federal government changed the individual mandate to be $0 (law was passed in 2017, went into effect 2019), effectively killing one of the main levers for pooling to limit costs. Unsurprisingly, cost increases year over year thereafter have been higher on average.
"...the ACA may have effectively spread the burden of additional fraud, waste, and abuse."
I agree with you that fraud, waste, and abuse is bad and should be rooted out. It's not clear to me how this is the ACA's fault though - the federal government should still be investigating fraud and abuse in Medicare and Medicaid. The Government Accountability Office did a good report on recommendations for CMS to weed out these problems: https://www.gao.gov/products/gao-24-107487
One tidbit in the report is that from 2016 to 2018, the government only investigated a total of 16 Medicaid managed care providers. You can't weed out fraud if you aren't investigating it! The fraud is in Medicare and Medicaid, and even if you repeal the ACA, this fraud would exist as Medicare and Medicaid will still exist. We should root out the fraud at the source.
I don't mean to spam, I'm just in the rabbit hole now :)
Based on your graph (would love a link to the data to be more precise), medicare spending (in 2024 dollars) per enrollee in 2010 was about $15,800, a 55% increase over 10 years since the beginning of the graph, from about $10,200 in 2000, at a compound annual growth rate of 4.5% per year.
From 2010 to 2024, it went from ~$15,800 to ~$16,600, or only a 5% increase in 14 years, at a compounded annual growth rate of just 0.4%. If from 2010 to 2024 growth continued at the 4.5% annual CAGR from before the ACA passed, 2024 costs would be a whopping $29,300.
You are correct that Medicare enrollees are more expensive. On average, older people get sick more and need care more than younger people. Additionally, one of the key parts of the ACA was to add protections for pre-existing conditions. Previously, if you had for example breast cancer, insurers could deny you coverage. This meant that sick people were uninsured completely, through no fault of their own. Coverage for sick people is definitely higher than coverage for healthy people, but we should want all people covered. Insurance is a collective bargain - you never know when you're going to get sick.
The more important chart is the annual change in expenditures one as it shows the consistent decline in expenditures per person prior to ACA passage and a distinct upswing in 2014 when major provisions of the ACA went into effect.
That is a fair point to note that Medicare recipients are older and tend to use more healthcare (although certain metrics are also including Medicaid, which should not have the same scale of costs), but the extremely high costs of healthcare in the U.S. make those numbers worthy of some skepticism. Rather than leveraging markets and pools to limit costs, the ACA may have effectively spread the burden of additional fraud, waste, and abuse.
Numbers are from the annual trustees reports:
2025 - https://www.cms.gov/oact/tr/2025
2016 - https://www.cms.gov/research-statistics-data-and-systems/statistics-trends-and-reports/reportstrustfunds/downloads/tr2016.pdf
I believe it's Table V.B3 for enrollment and Table V.B1. for expenditures but not certain.
"the annual change in expenditures one as it shows the consistent decline in expenditures per person prior to ACA passage"
he number on that graph is greater than $0 for 2000 to 2014, except 2013. This indicates that the cost was increasing every single year from 2000 to 2012 and then went down 2012 to 2013 and then increased again 2013 to 2014. This is not a decline in expenditures, it is an increase in expenditures. The graph *does* show that the increase in expenditures was slowing. From 2014 to 2018 though, the increase year of year is lower than the average 2000 to 2014.
"Rather than leveraging markets and pools to limit costs..."
Why did I stop at 2018? 2019 is relevant here because in 2019 the federal government changed the individual mandate to be $0 (law was passed in 2017, went into effect 2019), effectively killing one of the main levers for pooling to limit costs. Unsurprisingly, cost increases year over year thereafter have been higher on average.
"...the ACA may have effectively spread the burden of additional fraud, waste, and abuse."
I agree with you that fraud, waste, and abuse is bad and should be rooted out. It's not clear to me how this is the ACA's fault though - the federal government should still be investigating fraud and abuse in Medicare and Medicaid. The Government Accountability Office did a good report on recommendations for CMS to weed out these problems: https://www.gao.gov/products/gao-24-107487
One tidbit in the report is that from 2016 to 2018, the government only investigated a total of 16 Medicaid managed care providers. You can't weed out fraud if you aren't investigating it! The fraud is in Medicare and Medicaid, and even if you repeal the ACA, this fraud would exist as Medicare and Medicaid will still exist. We should root out the fraud at the source.