CBO warns of the consequences of repealing key ACA statutes

The CBO warns that, based previous Republican plans, consumers should be wary of the costs of repealing the ACA.

The Congressional Budget Office (CBO) estimated that repealing the ACA’s individual mandate, marketplace subsidies, and expanded Medicaid eligibility while sustaining other insurance market reforms under the law would decrease health insurance coverage and increase premiums.

Browse some of the key facts from CBO’s report for more information on the impending ACA repeal efforts.

  • CBO based its estimates as if previously introduced Republican legislation H.R. 3762, or the Restoring Americans’ Healthcare Freedom Reconciliation Act of 2015, were enacted. The bill features two primary steps that would affect insurance coverage and premiums, per the CBO’s report. First, H.R. 3762 would get rid of penalties associated with the ACA’s requirement that most people have health insurance and large employers have to offer their employees health insurance meeting specific standards. Second, the bill would eliminate Medicaid expansion under the ACA and subsidies for individuals who purchase health insurance through an ACA marketplace.
  • CBO and the Joint Committee on Taxation estimate 18 million people would become uninsured in the first new plan year following the enactment of the bill’s first step. The increase in the uninsured population would include roughly 10 million fewer people with health coverage through the individual market, 5 million fewer people with Medicaid coverage and 3 million fewer people with employer-based insurance.
  • If H.R. 3762 were enacted, its later elimination of expanded Medicaid eligibility and subsidies for health plans purchased through ACA marketplaces would increase the number of uninsured to 27 million the next year. The report projects that number would increase to 32 million by 2026.
  • CBO estimates health insurance premiums in the individual market would increase by 20% to 25% in the first new plan year, relative to projections under the ACA, if the bill was passed. In the year following the elimination of Medicaid expansion and marketplace subsidies, CBO projects premiums in the individual market would jump about 50%. By 2026, premiums would roughly double, according to the report.
  • CBO and JCT (Joint Committee on Taxation) said predicting H.R. 3762’s effects on individuals, employers, states, payers, physicians, hospitals and other affected parties is difficult and the estimates in the report reflect those in the middle of the distribution of potential outcomes. In other words, the results are far from certain and represent generalized outcomes.

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