The Congressional Budget Office’s scoring of the American Health Care Act was expected to be bad. It was not, among Republicans, expected to be as bad as it was, and that’s the fault of House Speaker Paul D. Ryan (R-Wis.), who did not properly prepare his members. The GOP defense was haphazard and contradictory. The Post reported:
[President] Trump’s budget director, Mick Mulvaney, said the report is “just absurd,” and Health and Human Services Secretary Tom Price said: “We disagree strenuously” with it.
Ryan defended the report, saying that it proves that the proposal will “dramatically” reduce the deficit and usher in “the most fundamental entitlement reform in a generation.”
The CBO is wrong. The CBO is actually good news. The CBO doesn’t matter. (Ryan insisted, “Our plan is not about forcing people to buy expensive, one-size-fits-all coverage.”) Which is it, fellas? Democrats could barely contain their glee, demanding that Ryan “pull the bill” and deeming it “immoral.” They had a point.
The Post explained:
House Speaker Paul D. Ryan’s proposal to revise the Affordable Care Act would lower the number of Americans with health insurance by 24 million while reducing the federal deficit by $337 billion by 2026, congressional budget analysts said Monday.
According to a Congressional Budget Office projection, 14 million fewer people would have health insurance next year alone. Premiums would be 15 percent to 20 percent higher in the first year compared with the Affordable Care Act and 10 percent lower on average after 2026. By and large, older Americans would pay “substantially” more and younger Americans less, the report said.
The report from the Congressional Budget Office fueled concerns that the GOP health-care plan would prompt a dramatic loss in health-insurance coverage, potentially contradicting President Trump’s vow that health-care reform would provide “insurance for everybody” and threatening support from moderate Republican lawmakers.
Democrats found evidence that the bill constitutes a stunning transfer of wealth, as House Minority Leader Nancy Pelosi (D-Calif.) said. She argued that while 24 million will lose coverage, the Republicans are “implementing the biggest transfer for wealth in our history, $600 billion gone from working families to the richest people and corporations in our country.” The bill improves the deficit picture only because it takes away more from the less well-off than it gives to the rich. The CBO explains that it will narrow the deficit “by $337 billion over the 2017-2026 period. … That change would result from a $1.2 trillion decrease in direct spending, partially offset by an $883 billion in revenues.”
The CBO confirmed that the bill saves money by cutting Medicaid and subsidies to other programs and loses money because of the tax cuts for primarily rich taxpayers. “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,” it said. “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.”
Once upon a time, Trump promised not to cut Medicaid. That, however, is precisely what the bill does:
The 31 states and the District of Columbia that have already expanded Medicaid to the newly eligible cover roughly half of that population nationwide. CBO projects that under current law, additional states will expand their Medicaid programs and that, by 2026, roughly 80 percent of newly eligible people will reside in states that have done so. Under the legislation, largely because states would pay for a greater share of enrollees’ costs, CBO expects that no additional states would expand eligibility, thereby reducing both enrollment in and spending for Medicaid. According to CBO’s estimates, that effect would be modest in the near term, but by 2026, on an average annual basis, 5 million fewer people would be enrolled in Medicaid than would have been enrolled under current law . . . CBO also anticipates some states that have already expanded their Medicaid programs would no longer offer that coverage, reducing the share of the newly eligible population residing in a state with expanded eligibility to about 30 percent in 2026.
And the CBO confirmed that older participants get treated the worst. (“Premiums in the nongroup market would be 20 percent to 25 percent lower for a 21-year-old and 8 percent to 10 percent lower for a 40-year-old — but 20 percent to 25 percent higher for a 64-year-old.”)
Ryan continues to insist that if people choose not to buy insurance under the new plan that is no concern of his. However, if they choose not to insure because they can no longer afford to, Ryan will have created the Unaffordable Care Act and stranded millions of people. It remains to be seen if the bill can make it through the House. One thing is for sure: A bill that transfers wealth from poor to rich is going to blow up the notion that Trump is a populist.