The CBO Is Right, and House Republicans Know It
The early reviews of the American Health Care Act (AHCA) have been disastrous, with doctors, hospitals, and liberal and conservative experts alike panning the House majority’s legislation. On Monday, the non-partisan Congressional Budget Office added its official score to the pile-on, projecting that 24 million Americans would lose health care coverage by 2026 if the bill was enacted.
The rest of the details from the CBO aren’t any prettier. The negative impact would start almost immediately, with 14 million Americans becoming uninsured next year as a result of the AHCA. This uninsured impact would grow even worse over time, to 21 million by 2020 and 24 million by 2026.
Federal Medicaid funding would be slashed by $880 billion over ten years, with 14 million fewer people covered by the program in 2026. In the individual market, average premiums would rise more quickly in the next few years until moderating and falling after 2020, with premiums in 2018 and 2019 projected to be 15 – 20 percent higher than they would be under the ACA. Premiums would grow the most for older enrollees, as insurers exercised their newfound ability to charge them five times as much as younger enrollees. At the same time, enrollees would face higher deductibles and other cost-sharing than under the ACA.
Although the latest numbers are new, they are no surprise. It’s been clear ever since the AHCA was a humble secret draft hidden in a basement and first leaked to the press that the bill’s deep cuts to Medicaid funding through per capita caps, rollback of Medicaid expansion over time, and tax credit levels would result in fewer people having health coverage than under the Affordable Care Act.
Indeed, House Republicans and their allies in the Trump administration appear to have already known it. Even before the CBO released its score, they had already begun aggressively attacking the CBO’s credibility – despite the fact that as the former House Budget Chairman, Secretary Tom Price personally signed off on the current CBO Director’s appointment.
What’s genuinely bizarre is that at the same time that they’ve apparently been expecting the CBO to find that millions of people would lose coverage, the AHCA’s supporters have been repeatedly and very publicly making impossible promises. Just this past weekend, Secretary of Health and Human Services Tom Price promised that “nobody will be worse off financially” under AHCA. This was just the latest in a string of such promises, such as House Republican Conference Chairwoman Cathy McMorris Rodger’s pledge in January that “No one who has coverage because of Obamacare today will lose that coverage.” And of course, President Trump himself promised, “We’re going to have insurance for everybody.”
Contrary to Secretary Price’s promise, an analysis by my colleagues at the Center for American Progress along with health economist David Cutler and Covered California’s chief actuary John Bertko, estimates that the average enrollee would pay $1,542 more in annual health care costs (including both premiums and cost-sharing) under the AHCA. The average increase in costs would be even higher for low-income enrollees ($2,945) and older enrollees ($5,269). This cost shifting would grow even larger in future years.
As this analysis and the CBO’s score shows, keeping these promises would be impossible under the AHCA. Even the head of the House’s right-wing Freedom Caucus has argued that the AHCA would raise health care premiums. But the reason Congressional leaders and the Trump administration keep making such promises is relatively straightforward: they feel intense political pressure to present their plan as offering comparable coverage and affordability to the ACA.
The impossibility of squaring this circle has pushed Congressional Republicans past mere denial to increasingly desperate arguments. Last week, they even began to attack the concept of health insurance itself. In a presentation to reporters, Speaker Paul Ryan argued that under the ACA, “the people who are healthy pay for the people who are sick. It’s not working.” As many baffled reporters noted afterward, this model of spreading risk is the basic economic principle underlying any form of health insurance.
The CBO’s score helps to show these arguments for what they are: distractions. Repealing the ACA and replacing it with the half-measures included in the AHCA would take away health coverage from 24 million people – breaking President Trump’s promise. Full stop.
Even in the age of alternative facts, that’s something advocates of repeal can’t wish away.
Thomas Huelskoetter is a Policy Analyst with the Health Policy team at the Center for American Progress.