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 The U.S. Congressional Budget Office forecast that 24 million more
people would be uninsured in 2026 if the plan being considered by
the House of Representatives to replace the 2010 Affordable Care Act
were adopted. Obamacare, as President Barack Obama's signature piece
of domestic policy is commonly called, expanded insurance to about
20 million Americans. (http://bit.ly/2mkdeYA)
Hours after the CBO report was released, the House Budget Committee
postponed its consideration of the Republican bill to Thursday from
Wednesday. Prior to the report, Republicans had been planning to
vote soon on the bill in the House, where it is likely to pass, and
send it to the Senate, where its outlook is uncertain.
The CBO projected that 52 million people would be uninsured by 2026
if the bill became law, compared with 28 million who would not have
coverage that year if the law remained unchanged.
Two House of Representatives committees have approved the
legislation to dismantle Obamacare that was unveiled by Republican
leaders a week ago, but it faces opposition from not only Democrats
but also medical providers including doctors and hospitals and many
conservatives. The CBO report's findings could make the Republican
plan a harder sell for lawmakers, particularly in the U.S. Senate.
The CBO, however, said federal deficits would fall by $337 billion
between 2017 and 2026 under the Republican bill.
Some health policy experts and Wall Street analysts said the report
was more draconian than expected, with the uninsured rate declining
more quickly than foreseen. Doctors groups and patient advocates
said the bill must be abandoned.
The AARP, a nonprofit advocacy group for aging Americans, said
Monday that the CBO analysis showed the financial burden of the
Republican plan would fall "disproportionately" on Americans 50 to
64 years old. In a five-page letter to House members last week, the
AARP has also criticized a tax cut it said would threaten the
solvency of Medicare, the government health insurance program for
the elderly and disabled, cuts to Medicaid and said the bill does
nothing to lower drug costs.
Some Republicans worry a misfire on the Republican healthcare
legislation could hobble Trump's presidency and set the stage for
losses for the party in the 2018 congressional elections.
The Trump administration defended the healthcare plan, which they
say will have a second and third phase that will entice consumers.
Health and Human Services Secretary Tom Price said at the White
House that Trump's plan would cover more individuals at a lower cost
and it was "virtually impossible" to envision that 14 million people
would lose insurance coverage by next year.
Democratic leaders in Congress said the bill could result in elderly
people being kicked out of nursing homes as it simultaneously gives
tax cuts for the richest Americans.
"How can they look their constituents in the eye when they say 24
million of you no longer have coverage and those of you who do have
it, will have less coverage at more cost to you," House Democratic
leader Nancy Pelosi said.
Trump himself made no comment on the report.
PREMIUMS TO RISE
The Affordable Care Act aimed to help restrain U.S. healthcare
spending, which is about 17 percent of the nation's economy, but it
has continued to grow faster than inflation.
The proposal would end the Obamacare expansion of the Medicaid
insurance program for the poor and would replace Obamacare's
income-based subsidies with fixed tax credits for the purchase of
private insurance.
The nonpartisan Tax Policy Center on Monday said the Republican plan
would benefit the wealthiest U.S. households far more than
middle-income families. A family making $51,600 to $89,400 a year,
including fringe benefits like employer-provided health insurance,
would get a tax cut averaging $300. The top 0.1 percent of earners
with incomes of at least $3.9 million would get a tax cut of about
$207,000, the study said.
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The CBO estimated that insurance premiums would rise 15 percent to
20 percent in both 2018 and 2019 because fewer healthy people would
sign up after the repeal of the Obamacare penalty for declining to
obtain insurance. But it said the hikes would be offset after 2020
by a $100 billion fund allocated to states in the bill and
deregulation in the insurance market.
By 2026, average premiums for single policyholders in the nongroup
market under the legislation would be roughly 10 percent lower than
the estimates under current law, in part because insurers will be
able to offer plans that cover a lower share of healthcare costs.
While the federal government would lose revenues through the repeal
of Obamacare’s individual and employer mandates’ tax penalties, CBO
said the loss would be surpassed by savings on insurance subsidies
and Medicaid payments that Washington would no longer have to
provide for people who lost coverage.
At the same time, CBO said the repeal of the individual mandate’s
tax penalties would mean higher health insurance premiums for those
who retained coverage, because insurers would still have to cover
any applicant without being free to raise premiums for older, sicker
people, despite lower numbers of younger, healthier customers who
are cheaper to insure.
Craig Garthwaite, director of the healthcare program at Northwestern
University's Kellogg School of Management, said the CBO estimates
made it harder for Republicans to sell their proposal.
"Overall, this is a really bad number for the AHCA. Far more people
are predicted to lose coverage than many estimated - and these
losses are going to happen more quickly than we would have thought,"
he said.
House of Representatives Speaker Paul Ryan, a key backer of the plan
called the American Health Care Act, said the CBO estimates showed
it would ultimately lower premiums.
"Our plan is not about forcing people to buy expensive,
one-size-fits-all coverage. It is about giving people more choices
and better access to a plan they want and can afford. When people
have more choices, costs go down," Ryan said.
Vishnu Lekraj, an equity analyst at Morningstar, said the bill is a
net negative for insurers, who would be helped by the elimination of
a tax, but hurt by the shrinking individual insurance business.
“The headline number will be viewed as a shock to the system
tomorrow," Brian Tanquilut, a stock analyst at Jefferies said of the
14 million losing insurance next year. "The reality of this is that
the number being big makes it harder for the bill to pass in its
current form.”
(Additional reporting by Tim Ahmann, Yasmeen Abutaleb, Doina Chiacu,
David Morgan, Mohammad Zargham and Richard Cowan in Washington; and
Caroline Humer and Michael Erman in New York; Writing by Paul Simao
and Amanda Becker; Editing by Will Dunham and Lisa Shumaker)
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