New report predicts more uninsured Americans under Romney's healthcare reform

President Barack Obama’s Affordable Care Act plan will leave roughly 27 million American uninsured by 2022, compared with the 72 million left uninsured by 2022 under Romney's proposal, according to the Commonwealth Fund, leading the organization to conclude that Obama’s plan for healthcare reform will likely outperform his challenger’s, according to a new report.

In a new analysis of each presidential candidates’ healthcare reform proposals, titled ”Health Care in the 2012 Presidential Election: How the Obama and Romney Plans Stack Up,”the Commonwealth Fund weighed Obama’s and Romney’s plans on seven criteria, including lowering or slowing healthcare spending, consumer choice, and affordability.

Obama’s Affordable Care Act (ACA) both “substantially increases and improves health insurance coverage in private insurance markets and in public insurance programs for Americans across income and age groups, while also providing new incentives aimed at improving health care quality and lowering the rate of growth in spending,” the study notes, adding the plan will allow more than 30 million people to gain subsidized healthcare coverage over the next decade. Obama’s plan maintains existing private insurance markets but also calls for tighter and more standardized regulations to ensure broad choice of health plans for consumers as well as better affordability for individually purchased plans.

In contrast, Romney’s plan to repeal and replace the ACA supports more limited regulation and encourages people to buy health plans in the individual market by changing the tax treatment of individually purchased coverage to mirror that now offered to employer-based plans.

When fully implemented, The Commonwealth Fund estimates that Obama’s ACA will reduce the number of uninsured by nearly 33 million, to 27.1 million by 2022. Without healthcare reform, the number of uninsured Americans is expected to reach 60 million by the same year. Under Romney’s proposal, the study estimates that the number of uninsured will increase the number of uninsured Americans by 12 million, for a total of 72 million, in the same time frame. More than 80 percent of the increase in the uninsured population stems from Romney’s proposed cuts in Medicaid eligibility resulting from state block grants.

“An estimated 1.9 million people would lose coverage under an income tax deduction for individually purchased coverage, since some employers may stop offering health insurance if their employees have an alternative. A similar dynamic is expected to occur as a result of the insurance provisions of the Affordable Care Act,” the study reports.

Individuals with incomes below 250% of the poverty level, uninsured young adults who will lose the ability to maintain coverage under their parents’ plans until the age of 26, seniors above age 65 and children are expected to be particularly hard hit under Romney’s plan, the report adds. Instead, Romney’s plan would benefit about half the number of people as the ACA-about 10 million-and most of those beneficiaries would be individuals who already have health insurance, according to the study.

In terms of consumer choice, individuals currently buying coverage in the consumer market have difficulty comparing plans. Obama’s proposal under the ACA for state insurance exchanges seeks to provide a menu of health plan choices comparing information on premiums, plan quality and enrollee satisfaction. All plans offered within the exchanges will include standard “essential benefits” and be sold at four tiers the come with higher costs depending on premium prices and coverage levels. Romney’s plan would repeal those provisions, replacing them with Consumer Reports-type ratings and allow individuals to purchase health plans across state lines, the report states. Romney’s proposal would allow insurance carriers to choose a state in which to be licensed and then sell coverage in other states, without having to comply with the regulations in each state. He would also allow people to pay insurance premiums with pretax contributions to health savings accounts. Currently people can use these accounts only to pay out-of-pocket expenses tax-free.

For Medicare, the ACA began phasing out the “doughnut hole” in prescription drug coverage in 2010 and offered preventive services and annual wellness visits without a cost to Medicare recipients. Romney’s plan would restore the doughnut hole and reinstate cost-sharing for preventive and wellness services. The Commonwealth Fund, citing estimates from the Congressional Budget Office (CBO) says Romney’s plan would end Medicare spending reductions and other provisions in the ACA and essentially increase Medicare spending by $716 billion between 2013 and 2022. Romney’s plan would then reduce costs in Medicare by giving recipients lump sums to purchase premiums with a Medicare private plan or traditional Medicare.

The Commonwealth Fund also notes that Romney’s plan to repeal ACA would result in a $109 billion increase to the federal budget deficit by 2022, according to CBO estimates, because he would replace premium support for Medicare beneficiaries with Medicaid block grants and reduce overall federal spending on both programs. This would shift the burden of meeting growths in healthcare costs from the federal government to states, low-income families and Medicare recipients “without addressing the underlying causes of rising costs,” according to the report.

Romney has proposed reforms to facilitate health information technology, promote alternatives to fee-for-service payment of physicians and cap noneconomic damages in medical malpractice lawsuits, which the CBO has estimated will provide some savings in healthcare costs-about 0.5% or less of total health spending.

The Commonwealth Fund is a private foundation that aims to promote a high performing health care system that achieves better access, improved quality, and greater efficiency, particularly for society's most vulnerable, including low-income people, the uninsured, minority Americans, young children, and elderly adults.