We often look at the cost of a program and see the outward benefits, but fail to see the underlying costs that are associated with said program. Such is the complexities involved in any new program, especially when it comes to state or federal government programs.
A great example of this is the Affordable Care Act (ACA), otherwise known as Obamacare. According to the current data, approximately 20 million people are now on health care that did not have health care in the past (even though there are approximately 6 million that no longer have health care that had it before, giving the NET at 14 million rather than 20 million, but that is another article for another day). The focus of this article is the associated paperwork that ACA implements as a result of this new program.
Specifically, I would like to mention the 1095-B and 1095-C, Health Care Coverage form and Employer Funded Healthy Care Coverage Form respectively. Because of various medical coverage, I received a number of these forms and my wife also received a number of these forms. Now, let’s extrapolate these to the population of people in the US that currently receive these forms.
If the figures are correct that 20 million people get health care coverage, this would mean that there are (at least) 20 million pieces of paper that are generated EACH YEAR to appropriately document that these people have health coverage. That would mean that there has to be printing devices to print these, mailing costs to mail these, and of course a department to ensure they track the distribution of these forms.
Let’s assume for a moment that it costs 1 dollar to print one of these forms, 30 cents to mail them, and the department in question consists of 20 people each making 50,000 dollars per year. That would mean that the costs are as follows (per year):
20 million dollars to print
6 million dollars to mail
1 million dollars in salary
TOTAL: 27 million dollars
And this figure does not take into consideration more than the 20 million people who get this form that are currently on health care; in other words the ones that are already on health care coverage. The costs could be 5 to 10 times what I listed per year. And this is just for the paperwork!
Now, this is unbelievable low considering the Congressional Budget Office original estimation of the cost of ACA, which was over 700 BILLION DOLLARS for five years between 2014 and 2019 (https://www.cbo.gov/publication/44176). However, it is important to note the “small” costs that are a part of this that will continue long after the large costs are mitigated (or just maintained as is often the case).
In the meantime, if one takes a look at programs like Social Security, we often do not realize the cost of these types of programs, which approach 1 TRILLION DOLLARS per year in benefits! It is those types of programs that are associated with TONS of paperwork that, even though they are more digital, does not often decrease the costs of those programs since the maintenance of the documentation for these programs can often lead to additional costs against that program.
How do we correct these paperwork nightmares? One way might be to introduce legislation that institutes a default choice — that everyone has health care unless proven that they do not. Of course, I am sure there are other ways to reduce or eliminate these paperwork overflows. Until then, we will be faced with funding the paper that will be a central part of our lives.
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