WASHINGTON — The nonpartisan Congressional Budget Office released its analysis of the American Health Care Act today, finding that by next year 14 million more people would be without any health insurance while federal deficits would be reduced over the next decade by $337 billion.
In response, congressional Democratic leaders said the GOP should pull the bill over the reduced coverage, while Republican leaders dug in and stressed lower premiums promised under the legislation.
The assessment by the CBO and the staff of the Joint Committee on Taxation, based on the legislation just passed through the House Ways and Means and Energy and Commerce committees, said most of the immediate increase in the uninsured would occur as a result of doing away 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,” explains the CBO summary.
By 2020, the number of uninsured would be expected to rise to 21 million people, and continue climbing to 24 million uninsured in 2026, including 7 million who would no longer receive coverage from their employer. Those increases would be preceded by changes ton Medicaid — “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.”
The greatest savings under the bill “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.”
The CBO expects health insurance premiums to rise in the short term and begin decreasing after 2020. “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,” the report summarizes.
By 2026, premiums would be expected to be about 10 percent less than current rates.
However, premiums will vary widely according to new age ratings, as “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.”
Outside the White House today, just after the CBO report was released, Health and Human Services Secretary Tom Price that the budget office “looked at a portion of our plan but not the entire plan” — the CBO said in addition to using the current legislation it worked with the budget committees, but the budget office doesn’t score legislation that hasn’t been crafted — and “ignored completely the other legislative activities that we’ll be putting into place that will make certain that we have an insurance market that actually works.”
“So we disagree strenuously with the report that was put out,” Price said. “We believe that our plan will cover more individuals at a lower cost and give them the choices that they want for the coverage that they want for themselves and their families, not that the government forces them to buy.”
He contested the finding that 14 million people would be uninsured, arguing “they’re going to be able to buy a coverage policy that they want for themselves and for their family.”
Price said the administration would delve further into the report and planned to “talk with our colleagues about why we believe the plan, the entire plan that we have recommended moving forward and adopting is one that will provide greater opportunity for folks to purchase the coverage that they want, and put patients, and families, and doctors in charge of health care, and not the federal government.”
House Speaker Paul Ryan (R-Wis.) quickly went on Fox News to say he was “encouraged” by the 9-year forecast of eventual lower premiums.
“It stabilizes the market. It’s a $1.2 trillion spending cut, an $883 billion tax cut, and $337 billion in deficit reduction,” Ryan said. “So of course the CBO is going to say if you’re not going to force people to buy something they don’t want to buy, they won’t buy it. But at the same time, they’re saying our reforms will kick in and lower premiums and make health care therefore more accessible.”
“…The insurers are telling us premium increases this year, 25 percent on average, will be even higher next year. This compared to the status quo is far better.”
Senate Minority Leader Chuck Schumer (D-N.Y.) said the report “should be a looming stop sign for the Republicans repeal effort.”
“The CBO’s estimate makes clear that TrumpCare will cause serious harm to millions of American families. Tens of millions will lose their coverage, and millions more, particularly seniors, will have to pay more for healthcare,” Schumer said. “The CBO score shows just how empty the president’s promises, that everyone will be covered and costs will go down, have been.”
House Minority Whip Steny Hoyer (D-Md.) argued that GOPs “can no longer deny the magnitude of coverage losses and cost increases that would result” from the bill’s enactment.
“The CBO has always been a nonpartisan, respected arbiter of cost and economic impact. That respect must be maintained across party lines, or else we risk creating an environment in which each party can claim its own facts, stifling honest debate,” Hoyer said. “Now that the CBO has weighed in, the Budget Committee should cancel its markup this week on a bill that would harm our economy and working families across this country.”
House Budget Committee Chairwoman Diane Black (R-Tenn.) said this week’s markup was still on.
“Dismantling the individual mandate gives Americans the freedom to make choices for themselves, even if that choice is to not have healthcare coverage,” Black said. “We believe and are committed to the idea that the American people are best suited to make decisions about their own lives.”
Sen. Bernie Sanders (I-Vt.), an advocate of single-payer healthcare, slammed the GOP bill as “a disgusting and immoral proposal” after the CBO report was released.
“Last January, Donald Trump promised that his healthcare plan would provide ‘insurance for everybody’ that would be ‘much less expensive and much better.’ Now we know that was just another lie,” Sanders said. “The reality is that Donald Trump and Paul Ryan’s bill is not a healthcare plan. It’s a massive transfer of wealth from the middle class to the wealthiest people in America. It must be defeated.”