Two Congressional committees have already passed their legislative efforts to repeal the Affordable Care Act without waiting for feedback from the nonpartisan Congressional Budget Office on how these bills would affect the number of insured in the U.S. The CBO has now released its analysis, concluding that the repeal would result in 14 million fewer people having health insurance in only the first year. After a decade, the CBO estimates that 24 million more people would be without coverage than if the existing plans were kept in place.
According to the report [PDF], many of the 14 million Americans who would be added to the current number in the first year of repeal would come from those who actively elect to not pay for insurance. Within that group, there would be those who can afford coverage but choose not to and those who will no longer be able to purchase insurance because of higher premiums.
The number of uninsured is predicted to increase as Medicaid expansion is pared back, says the CBO. The report predicts that in 2020, when states will be able to undo the recent ACA expansions of Medicaid eligibility, there will be 21 million more uninsured Americans than if the ACA were still in place. By 2026, that disparity would grow to 24 million, calculates the CBO, meaning 52 million people will not have coverage.
In terms of insurance premiums, the CBO says that the current repeal plans would tend to increase the cost of coverage for people purchasing plans on their own through 2020, followed by a decrease afterward.
More precisely, the CBO estimates that premiums in 2018 and 2019 would be between 15% to 20% higher than they would be under Obamacare. The report pegs much of this price inflation on the fact that millions of healthy, low-risk Americans would choose to forgo coverage.
The expected premium decrease following 2020 would come, claims the CBO, from a number of factors. Among them: Insurance companies would not be required to offer plans covering certain percentages of the cost of covered benefits. Additionally, the pending legislation would allow insurers to charge more for older policyholders than they do now. The law currently only allows insurers to charge an older enrollee up to three times what they charge to young adults. The repeal legislation would let insurers increase that amount so that older enrollees could be charged as much as five times what younger ones pay.
That should, claims the CBO, have the effect of raising rates on the older policyholders while decreasing rates on the younger. As a result, the mix of those having coverage will be younger and lower-risk, which the CBO believes will lead to decreased average rates.
In terms of the federal budget deficit, the report estimates that the repeal plan would cut $337 billion from the deficit by 2026. It predicts that, during this 10-year period, $1.2 trillion less would be spent by the federal government, offset by $883 billion in tax revenue the Treasury won’t collect.
Our colleagues at Consumer Reports say today’s CBO analysis confirmed their “grave doubts” about the current repeal and replace legislation.
“Lawmakers promised ‘more for less’ but this bill delivers the opposite – fewer people with skimpier coverage and higher costs,” said Laura MacCleery, vice president of policy and mobilization for Consumer Reports “Despite the many budgetary tricks in this bill to disguise the true cost of this legislation, lawmakers can no longer hide the fact that this bill would leave millions uninsured.”
The CBO report, or lack thereof, was a hot-button issue during last week’s mark-up hearings in the House Ways and Means Committee and the House Committee on Energy and Commerce. Critics of the legislation accused GOP lawmakers of trying to push through this bill — which is actually a budget resolution, meaning it only needs 51 votes in the Senate — without doing their due diligence.
“To consider a bill of this magnitude without a CBO score is not only puzzling and concerning, it is also irresponsible,” said Rep. Richard Neal (MA) during last Wednesday’s Ways and Means hearing.
In advance of the CBO report, several high-profile Republicans questioned the Office’s ability to accurately predict healthcare figures, noting that it was off in its initial projections of how many people would obtain insurance under the Affordable Care Act. However, as the Wall Street Journal pointed out this morning, the CBO’s original estimates were more accurate than most predictions turned out to be.
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