CBO: Revised Obamacare Replacement Would Cost More, Still Leave 52 Million Without Insurance By 2026

Image courtesy of MeneeDijk

When the nonpartisan Congressional Budget Office first looked at the GOP legislation to repeal and replace the Affordable Care Act, it predicted that changes would cut more than $300 billion from the federal deficit over the next decade, but at the cost of 52 million Americans going without health care coverage. Republicans have continued to tinker with the bill and even canceled today’s scheduled vote in order to keep tweaking, but the latest numbers from CBO say that the revised legislation could result in fewer savings for the Treasury and no real change to the number of uninsured.

Rather than the $337 billion deficit reduction estimated earlier this month, the CBO now says [PDF] that less than half that amount ($150 billion) would ultimately be saved by the revised plan it reviewed.

The new estimate sees no real change in the number of Americans who would lose or drop coverage over the next decade. It still predicts that 14 million additional people would be without insurance in the first year, 21 million by 2020, and 24 million people by 2026. Remember, this is on top of those that would expect to be without insurance under “Obamacare,” so that means 52 million Americans without coverage by the end of the first ten years.

Likewise, CBO still predicts that insurance premiums will rise for the first few years and then — on average — decline after 2021.

So why would this version result in a smaller cut to the deficit? One reason, says the CBO, is a proposed reduction in the threshold for the medical care deduction on income taxes for older Americans. Right now, if you or your spouse is over the age of 65, you can deduct medical expenses that are greater than 7.5% of your adjusted gross income. A proposed revision would drop that threshold to 5.8%, meaning more tax deductions for older Americans with health care expenses. It also means fewer income taxes collected by the Treasury. CBO estimates around $90 billion in tax revenue would be lost by 2026.

The CBO says that an additional $48 billion in tax revenue won’t be collected because of other revisions, like “adjusting the effective dates and making other modifications to the provisions that repeal or delay many of the changes in the Affordable Care Act.”

Changes to Medicaid, like increasing the money spent covering the elderly, visually impaired, and disabled, will result in more spending by the government, though the CBO believes that some of this increased expense will be offset by other revisions, like allowing states to require that some Medicaid enrollees be employed in order to obtain benefits. The net result, per the CBO, is $41 billion less the government will be saving than under the original plan.

Similarly, notes the report, some Medicaid revisions have the effect of adding coverage for people that were counted as likely uninsured in the previous estimate, but the report notes that this population increase would probably be offset by other changes to the program.

Looking at the big picture, CBO says its coverage estimates differ by “no more than half a million people in any category in any year over the next decade.”

Keep in mind, this CBO analysis is only for the changes that were submitted by Speaker of the House Paul Ryan earlier this week. Ryan and the Trump administration have reportedly continued to revise the legislation in an effort to win over Republican legislators who oppose it, either because it leaves too many uninsured, or because it doesn’t go far enough in repealing the Affordable Care Act.

What remains to be seen is whether the CBO will be given the opportunity to provide a second revised estimate based on whatever House leadership finally decides to bring to the floor for a vote.

The House is already considering a resolution that, if passed, would allow lawmakers to effectively get right to voting on the health care bill.

This morning, Rep. Jim McGovern (MA), who is acting as ranking member on the House Rules Committee in the absence of Rep. Louise Slaughter, criticized the effort to fast-track the repeal resolution.

“This is not a game,” he said to Rep. Pete Sessions (TX), Chairman of the Rules Committee. “You don’t get extra points for being fast.”

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