On December 20, 2017, the U.S Congress after material obstacles, passed what is without any doubt a historic legislation, the Tax Cuts and Jobs Act of 2017 (TCJA). President Donald J. Trump for technical budge reasons, as has been reported, is expected to execute and become law in first few days of 2018.
Though the law was intended to cut taxes for U.S. Corporations and individuals, the new law has material impact on healthcare. The big event on healthcare is the “repeal of the individual mandate” to have health insurance coverage as part of the Affordable Care Act of 2010 (ACA), also referred to as ObamaCare.
According to the Congressional Budget Office (CBO), it estimated that 4 million Americans will opt-out of health insurance in 2019, and that number will be increasing to 13 million by 2027.
There are also other potential implications, one is that individual premiums could rise by 10% “in most years of the next decade.” That means that in roughly eight years, individual healthcare premiums will double.
The CBO noted that most of those that opt out could be those that are healthier. In summary, more people will only be able to access healthcare by paying for services directly and not though their insurance companies. We believe that number of uninsured or underinsured and those with high deductible plans will increase materially.
Approximately, 70 million Americans could be uninsured, underinsured, or have high deductible plans by 2027. This is particularly challenging when recent reports stated that healthcare cost increased a minimum of 4.3% in 2016.
Clearly, we are at a time where we will need more transparent pricing models in healthcare for those paying for healthcare out of pocket, and better use of technology to control cost and provide better care. More on TCJA in the future.
– Noel J. Guillama, President