The debate over whether to extend the expanded Affordable Care Act subsidies has consumed lawmakers, precipitated a government shutdown, and sparked Republican infighting. Unfortunately, it’s the wrong debate.
CRA Senior Consultant Zack Cooper shared his expertise in The New York Times article, “$27,000 a Year for Health Insurance. How Can We Afford That?” In the piece, Dr. Cooper emphasizes the importance of extending the current Affordable Care Act subsidies to help families manage their insurance premiums. However, he notes that while renewing these subsidies would provide temporary relief, it does not address the deeper issue: surging health care spending.
Health care costs have driven down wages and made medical bills unaffordable for many Americans. The US pays more for health care than other countries due to higher prices, quick adoption of costly technology, and high administrative costs.
With premiums set to rise sharply next year, solutions are complex because health care spending supports millions of jobs and some higher spending improves care quality, making reform politically challenging.
Dr. Cooper recommends three parallel reform paths: fixing inefficient policies (like Medicare payment disparities), enacting small-scale interventions to incrementally reduce costs, and studying larger systemic reforms such as decoupling insurance from employment or regulating provider prices. A bipartisan commission to address health care spending is deemed essential, and while extending ACA subsidies is necessary to provide immediate relief, true affordability requires broader, politically courageous reforms that make care itself less expensive.
