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Budget Office: 14 Million Would Become Uninsured Under GOP Healthcare Bill

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."