Analysis of the Congressional Budget Office’s Estimate of the House-Passed Affordable Care Act Repeal Legislation
On
According to CBO/JCT projections, over the next decade, 23 million people will lose health insurance under the proposed legislation compared to current law. CBO/JCT project that losses will occur due to the proposal's repeal of the
CBO estimates that changes to
Private Insurance Changes
Age Rating
Under the ACA, marketplace plan enrollees, including "near seniors" age 50 to 64, can be charged no more than three times what a 21-year-old would pay.
Preexisting Conditions
The amended
CBO and JCT predict that community-rated premiums would rise over time. As a result, people who are less healthy (including those with preexisting or newly-acquired medical conditions) would not be able to secure coverage at premiums comparable to those under current law.
The amendment would require states receiving this waiver to set up high-risk pools where people with preexisting conditions could buy health insurance. However, most high-risk pools have failed because they did not have enough money to cover sicker enrollees and the
Essential Health Benefits
The MacArthur/Meadows amendment creates a waiver to allow insurance carriers not to offer essential health benefits like prescription drugs, chronic disease management and maternity care. In waiver states, that means insurance plans might not cover chemotherapy for cancer patients or insulin for diabetics.
Changes to premium tax credits
The American Health Care Act would drive up seniors' out-of-pocket costs by repealing the ACA's subsidies, based on income and the cost of health insurance, that help defray the cost of premiums. The
According to CBO, for individuals with income over 150 percent of the federal poverty level, the legislation would reduce the percentage of income younger people have to pay toward their premiums while increasing that percentage for older people.
Continuous coverage
The American Heath Care Act replaces the ACA's individual mandate with a different mechanism to encourage individuals to purchase insurance. Individuals who don't maintain continuous health insurance coverage would have to pay a 30 percent surcharge on their premiums for 12 months when reenrolling after a break in coverage of more than 63 days. This would ultimately drive healthier individuals, who would be unwilling to pay the surcharge, out of the individual market, which would drive up premium costs for those who remain.
IMPACT ON SENIORS
As a result of these changes, CBO finds that people between 50 and 64 years old with income of less than 200 percent of the federal poverty level (FPL) would make up a larger share of the uninsured, from just over 10 percent under current law to nearly 30 percent under
Over time, CBO/JCT predict that the impact on premiums will vary based on: 1) whether states choose to seek waivers of federal underwriting and essential health benefits rules, 2) a person's age, and 3) a person's health status. In states that apply for waivers to allow for underwriting, community rated premiums would rise over time, creating instability in the market for individuals with higher than average health care costs.
For older people with lower incomes, CBO/JCT estimate that on average net premiums would be much larger than under current law. For younger people with lower incomes, net premiums would be about the same or smaller (depending on the state's approach to essential health benefits (EHB) and preexisting conditions). Individuals would face "substantial increases" in their out-of-pocket costs under plans that narrow their scope of benefits for services that would be covered under existing law but not under
As a result of these changes to market regulations under
Changes to
Millions of
Medicaid Expansion
Under the ACA's
While the House bill allows states to get the ACA expansion matching rate for current beneficiaries, obtaining the enhanced match is contingent upon these beneficiaries staying continuously enrolled in the program. But
Medicaid Restructuring
Repealing Community First Choice
Under current law, states can elect the Community First Choice State Plan Option, allowing them to receive a six-percentage point increase in their federal matching rate for some services provided by home and community-based attendants to certain
IMPACT ON SENIORS
Over time, states that lose money under per capita caps would have to make up the funding themselves, by cutting benefits and/or limiting eligibility, if federal funds do not keep up with their
States could address their funding shortfalls in ways that would harm seniors and their families, including:
* Scaling back nursing home quality, service and safety protections.
* Requiring patients' spouses, children or other family members to cover the cost of nursing home care, exhausting much or all of their savings.
* Tightening eligibility criteria for home and community-based services, resulting in more individuals moving into nursing homes.
* Limiting the number of people served.
Impact on
Repeal of the High Wage Earner Medicare Payroll Tax
The ACA includes a 0.9 percent
Increase in Medicare Disproportionate Share Hospital Payments
Repeal tax on drug manufacturers
According the Chief Actuary of the
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