Politics
Out of context: Reply #25304
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- allthethings0
It goes on from here. An estimated 24 million will lose their insurance.
CONGRESSIONAL BUDGET OFFICE
COST ESTIMATE
March 13, 2017
American Health Care Act
Budget Reconciliation Recommendations of the House Committees on Ways and Means
and Energy and Commerce, March 9, 2017
SUMMARY
The Concurrent Resolution on the Budget for Fiscal Year 2017 directed the House
Committees on Ways and Means and Energy and Commerce to develop legislation to
reduce the deficit. The Congressional Budget Office and the staff of the Joint Committee
on Taxation (JCT) have produced an estimate of the budgetary effects of the American
Health Care Act, which combines the pieces of legislation approved by the two committees
pursuant to that resolution. In consultation with the budget committees, CBO used its
March 2016 baseline with adjustments for subsequently enacted legislation, which
underlies the resolution, as the benchmark to measure the cost of the legislation.
Effects on the Federal Budget
CBO and JCT estimate that enacting the legislation would reduce federal deficits by
$337 billion over the 2017-2026 period. That total consists of $323 billion in on-budget
savings and $13 billion in off-budget savings. Outlays would be reduced by $1.2 trillion
over the period, and revenues would be reduced by $0.9 trillion.
The largest savings would come from reductions in outlays for Medicaid and from the
elimination of the Affordable Care Act’s (ACA’s) subsidies for nongroup health insurance.
The largest costs would come from repealing many of the changes the ACA made to the
Internal Revenue Code—including an increase in the Hospital Insurance payroll tax rate
for high-income taxpayers, a surtax on those taxpayers’ net investment income, and annual
fees imposed on health insurers—and from the establishment of a new tax credit for health
insurance.
Pay-as-you-go procedures apply because enacting the legislation would affect direct
spending and revenues. CBO and JCT estimate that enacting the legislation would not
increase net direct spending or on-budget deficits by more than $5 billion in any of the four
consecutive 10-year periods beginning in 2027.
2
Effects on Health Insurance Coverage
To estimate the budgetary effects, CBO and JCT projected how the legislation would
change the number of people who obtain federally subsidized health insurance through
Medicaid, the nongroup market, and the employment-based market, as well as many other
factors.
CBO and JCT estimate that, in 2018, 14 million more people would be uninsured under the
legislation than under current law. Most of that increase would stem from repealing the
penalties associated with the individual mandate. Some of those people would choose not
to have insurance because they chose to be covered by insurance under current law only to
avoid paying the penalties, and some people would forgo insurance in response to higher
premiums.
Later, following additional changes to subsidies for insurance purchased in the nongroup
market and to the Medicaid program, the increase in the number of uninsured people
relative to the number under current law would rise to 21 million in 2020 and then to
24 million in 2026. The reductions in insurance coverage between 2018 and 2026 would
stem in large part from changes in Medicaid enrollment—because some states would
discontinue their expansion of eligibility, some states that would have expanded eligibility
in the future would choose not to do so, and per-enrollee spending in the program would be
capped. In 2026, an estimated 52 million people would be uninsured, compared with
28 million who would lack insurance that year under current law.
Stability of the Health Insurance Market
Decisions about offering and purchasing health insurance depend on the stability of the
health insurance market—that is, on having insurers participating in most areas of the
country and on the likelihood of premiums’ not rising in an unsustainable spiral. The
market for insurance purchased individually (that is, nongroup coverage) would be
unstable, for example, if the people who wanted to buy coverage at any offered price would
have average health care expenditures so high that offering the insurance would be
unprofitable. In CBO and JCT’s assessment, however, the nongroup market would
probably be stable in most areas under either current law or the legislation.
Under current law, most subsidized enrollees purchasing health insurance coverage in the
nongroup market are largely insulated from increases in premiums because their
out-of-pocket payments for premiums are based on a percentage of their income; the
government pays the difference. The subsidies to purchase coverage combined with the
penalties paid by uninsured people stemming from the individual mandate are anticipated
to cause sufficient demand for insurance by people with low health care expenditures for
the market to be stable.
3
Under the legislation, in the agencies’ view, key factors bringing about market stability
include subsidies to purchase insurance, which would maintain sufficient demand for
insurance by people with low health care expenditures, and grants to states from the Patient
and State Stability Fund, which would reduce the costs to insurers of people with high
health care expenditures. Even though the new tax credits would be structured differently
from the current subsidies and would generally be less generous for those receiving
subsidies under current law, the other changes would, in the agencies’ view, lower average
premiums enough to attract a sufficient number of relatively healthy people to stabilize the
market.
Effects on Premiums
The legislation would tend to increase average premiums in the nongroup market prior to
2020 and lower average premiums thereafter, relative to projections under current law. In
2018 and 2019, according to CBO and JCT’s estimates, average premiums for single
policyholders in the nongroup market would be 15 percent to 20 percent higher than under
current law, mainly because the individual mandate penalties would be eliminated,
inducing fewer comparatively healthy people to sign up.
Starting in 2020, the increase in average premiums from repealing the individual mandate
penalties would be more than offset by the combination of several factors that would
decrease those premiums: grants to states from the Patient and State Stability Fund (which
CBO and JCT expect to largely be used by states to limit the costs to insurers of enrollees
with very high claims); the elimination of the requirement for insurers to offer plans
covering certain percentages of the cost of covered benefits; and a younger mix of
enrollees. By 2026, average premiums for single policyholders in the nongroup market
under the legislation would be roughly 10 percent lower than under current law, CBO and
JCT estimate.
Although average premiums would increase prior to 2020 and decrease starting in 2020,
CBO and JCT estimate that changes in premiums relative to those under current law would
differ significantly for people of different ages because of a change in age-rating rules.
Under the legislation, insurers would be allowed to generally charge five times more for
older enrollees than younger ones rather than three times more as under current law,
substantially reducing premiums for young adults and substantially raising premiums for
older people.- I 'lost' my insurance when Obama's setup kicked-in... but I was able to buy a new plan. Isn't that the case here?PonyBoy
- I don't think so. They are talking mainly about people who won't be able to afford insurance.yuekit
- Under the new plan, they will be able to afford if they save accordingly.monospaced
- no way this gets past the senateBonSeff
- I'll take that bet :/monospaced
- Right. GOP says this is all about "choice." Like I can choose to have a Lamborghini.allthethings
- omg genetic affordable healthcare for all lolfadein11
- because this is just a budget reconciliation measure and not 'new legislation' they can avoid the filibuster on this... I think mono might be right =\BuddhaHat
- Mind numbing how people can be for this crap. A total fuck you to America. This country is fucked. Fucked.formed