When the Congressional Budget Office finally released its scoring of the American Health Care Act, it seemed anti-climactic, if not irrelevant. The Senate is not bothering to take up the AHCA at all. The CBO score, to the delight of Democrats, does remind us how counterproductive is the GOP House bill, which every member will have to defend in 2018.
The CBO states that the AHCA reduces the federal deficit by $119 billion over 10 years, some $32 billion less than the previous version. (Had it been a negative number the House would arguably have had to revote on it to make it reconciliation-ready.) As Democrats are all too eager to point out, the savings comes from taking benefits away from poor and middle-class individuals. (“The largest savings would come from reductions in outlays for Medicaid and from the replacement of the Affordable Care Act’s (ACA’s) subsidies for nongroup health insurance with new tax credits for nongroup health insurance,” the report says.) The beneficiaries here are the rich: “The largest increases in the deficit would come from repealing or modifying tax provisions in the ACA that are not directly related to health insurance coverage — such as repealing a surtax on net investment income, repealing annual fees imposed on health insurers, and reducing the income threshold for determining the tax deduction for medical expenses.” These taxes fall largely on the richest taxpayers.
That’s not the worst of it for Republicans. First, once again we see that the GOP plan will substantially increase the number of uninsured. The CBO states:
14 million more people would be uninsured under H.R. 1628 than under current law. The increase in the number of uninsured people relative to the number projected under current law would reach 19 million in 2020 and 23 million in 2026. In 2026, an estimated 51 million people under age 65 would be uninsured, compared with 28 million who would lack insurance that year under current law.
What’s more, it does nothing to combat the central problem with Obamacare, according to Republicans, namely sustainability of the system. The problem arises from the “fix,” the Meadows-MacArthur amendment that makes the bill worse than the original:
About one-sixth of the population resides in areas in which the nongroup market would start to become unstable beginning in 2020. That instability would result from market responses to decisions by some states to waive two provisions of federal law, as would be permitted under H.R. 1628. One type of waiver would allow states to modify the requirements governing essential health benefits (EHBs), which set minimum standards for the benefits that insurance in the nongroup and small-group markets must cover. A second type of waiver would allow insurers to set premiums on the basis of an individual’s health status if the person had not demonstrated continuous coverage; that is, the waiver would eliminate the requirement for what is termed community rating for premiums charged to such people. CBO and [Joint Taxation Committee] anticipate that most healthy people applying for insurance in the nongroup market in those states would be able to choose between premiums based on their own expected health care costs (medically underwritten premiums) and premiums based on the average health care costs for people who share the same age and smoking status and who reside in the same geographic area (community-rated premiums). By choosing the former, people who are healthier than average would be able to purchase nongroup insurance with relatively low premiums.
CBO and JCT expect that, as a consequence, the waivers in those states would have another effect: Community-rated premiums would rise over time, and people who are less healthy (including those with preexisting or newly acquired medical conditions) would ultimately be unable to purchase comprehensive nongroup health insurance at premiums comparable to those under current law, if they could purchase it at all — despite the additional funding that would be available under H.R. 1628 to help reduce premiums. (Emphasis added.)
In other words the GOP claim that they protected those with preexisting conditions is false.
As for out-of-pocket costs, another GOP complaint about the Affordable Care Act, “Although premiums would decline, on average, in states that chose to narrow the scope of [essential health benefits], some people enrolled in nongroup insurance would experience substantial increases in what they would spend on health care. People living in states modifying the EHBs who used services or benefits no longer included in the EHBs would experience substantial increases in out-of-pocket spending on health care or would choose to forgo the services.” In short, the sickest people will wind up paying a lot more.
Republicans falsely state there is nothing new here. In fact, the CBO helps unmask the bogus claim that the Republicans protected people with preexisting conditions. The more one looks at the bill, the more one sees it “succeeds” in only one regard — giving big tax cuts to the very rich. Democrats are going to have a field day with this.