Politics

Was the CBO report on GOP health care bill good or bad? Depends on whom you ask.

House Speaker Paul Ryan, R-Wis., center, with Energy and Commerce Committee Chairman Greg Walden, R-Ore., right, and House Majority Leader Kevin McCarthy, R-Calif., speaks during a news conference on the American Health Care Act on Capitol Hill in Washington, March 7, 2017.
House Speaker Paul Ryan, R-Wis., center, with Energy and Commerce Committee Chairman Greg Walden, R-Ore., right, and House Majority Leader Kevin McCarthy, R-Calif., speaks during a news conference on the American Health Care Act on Capitol Hill in Washington, March 7, 2017. AP

The revised House Republican bill to replace Obamacare would leave 23 million people without health insurance by 2026 and 14 million uninsured in its first year, according to a new analysis released Wednesday by the Congressional Budget Office.

The new estimates for the American Health Care Act are a slight improvement over earlier CBO projections that found 24 million would lose coverage over the next decade.

The legislation would reduce the federal budget deficit by $119 billion over 10 years. That’s $32 billion less than the estimated savings for the previous version of the bill. Most of the savings comes from cuts to Medicaid and to the tax credits that help purchase individual coverage under the Affordable Care Act.

Individual insurance premiums would increase by an average of 20 percent in 2018 and 5 percent in 2019 under the legislation.

In a statement, Health and Human Services Secretary Tom Price slammed the Congressional Budget Office’s report.

“The CBO was wrong when they analyzed Obamacare’s effect on cost and coverage, and they are wrong again,” Price said. “In reality, Americans are paying more for fewer health care choices because of Obamacare, and that’s why the Trump administration is committed to reforming health care.”

But in the Republican-led Congress, House Speaker Paul Ryan, R-Wis., said the report proved that his legislation was the right path forward.

“This CBO report again confirms that the American Health Care Act achieves our mission: lowering premiums and lowering the deficit,” he said in a statement. “It is another positive step toward keeping our promise to repeal and replace Obamacare.”

As the Senate works to draft compromise legislation, the new CBO estimates still present a formidable obstacle for moderate Republicans who already fear the legislation – which passed the House of Representatives early this month – would extract too heavy a toll on poor, sick and older people with individual insurance coverage.

In an interview with Reuters, Senate Majority Leader Mitch McConnell, R-Ky., expressed concern about mustering enough support for the ACA repeal legislation – even though it will be vastly different from the House version.

“I don’t know how we get to 50 (votes) at the moment. But that’s the goal,” McConnell said.

Democrats are sure to keep up their barrage of criticism against vulnerable Republicans, eager to point out how constituents might lose under the GOP bill. “Voters will know exactly who is to blame for their premium increases,” warned Democratic Senatorial Campaign Committee spokesman David Bergstein.

Senate Minority Leader Chuck Schumer, D-N.Y., told reporters the CBO report warns that costs would skyrocket, making coverage unaffordable for seniors and people with pre-existing conditions.

He said the report “ought to be the final nail in the coffin” of Republican attempts to overhaul health care. “Republicans in Washington and the president should read this report cover to cover, throw their bill in the trash and begin working with Democrats,” he said.

The individual insurance market is in turmoil as carriers struggle to determine their premium rates for 2018.

In addition to steep rate increases this year, carriers lack enough younger, healthy plan members to offset the higher cost of sicker, older enrollees. And many insurers have withdrawn from the market altogether, leaving certain areas of the country with one or no plan offerings.

On Wednesday, Blue Cross and Blue Shield of Kansas City announced that it would no longer offer individual coverage in its 32-county service area in Missouri and Kansas due to more than $100 million in losses.

“This is unsustainable for our company,” said a statement from President and CEO Danette Wilson. “We have a responsibility to our members and the greater community to remain stable and secure, and the uncertain direction of this market is a barrier to our continued participation.”

The tortured GOP effort to replace Obamacare, a wave of new rules affecting the marketplace next year and the Trump administration’s plan not to enforce the Affordable Care Act’s individual mandate – which requires most people to have health insurance or pay a fine – also have contributed to the shaky markets.

The most immediate threat, however, is the Trump administration’s refusal, thus far, to reimburse insurers for $9 billion in subsidies they’ve paid to help low-income enrollees purchase coverage.

Without repayment of the “cost-sharing reductions,” insurers would have to raise premiums up to 20 percent next year to make up for the shortfall. Many would leave the market altogether if the money isn’t recouped.

The Trump administration wants to use the unpaid subsidies as leverage to force congressional Democrats to help negotiate terms of the Affordable Care Act repeal legislation. Earlier this week, the administration sought a three-month delay on a ruling in a federal lawsuit over the subsidies.

Insurers say the additional delay will only make it harder for insurers to calculate their premiums for next year.

The Republican health care legislation has been widely criticized for weakening consumer protections in Obamacare, slashing funding for Medicaid and leaving millions more without health insurance by 2026.

Dozens of advocacy organizations and health care groups – like AARP, the American Diabetes Association and the American Medical Association – oppose the measure. In fact, no patient group, medical organization or hospital group has voiced support for it.

The Republicans’ first legislative effort was pulled from the House floor for lack of support only minutes before a scheduled vote in March.

The GOP plan was languishing until an amendment by Rep. Tom MacArthur, R-N.J., allowed states to sidestep an Affordable Care Act requirement that individual insurers cover 10 “essential” health benefits. The amendment also lets states bypass ACA rules that ban individual insurers from charging higher rates to people with pre-existing medical conditions.

The CBO projects that one-third of the nation’s population resides in states that would take advantage of those amendments. In those states, average premiums would be roughly 20 percent lower in 2026 because “insurance policies would provide fewer benefits,” the report says.

The reductions in average premiums would range from 10 percent to 30 percent in different areas of the country. Younger people would see substantially larger reductions, and older people substantially smaller.

Coverage likely to be excluded from “essential” health benefits could include maternity care, mental health and substance abuse benefits, pediatric dental care and rehabilitative services, according to the Congressional Budget Office.

“In particular, out-of-pocket spending on maternity care and mental health and substance abuse services could increase by thousands of dollars in a given year for the nongroup enrollees who would use those services,” the report says.

Another amendment to the GOP health bill added $8 billion to a proposed $115 billion pot of money that states could use to fund high-risk pools, which provide health coverage for the medically uninsurable. The legislation would steer people with costly medical conditions who haven’t maintained continuous individual coverage into the high-risk pools to lower premiums for others.

Both amendments shored up conservative support for the legislation, which narrowly passed the House on May 4.

Most of the bill’s deficit savings over 10 years are driven by an $834 billion cut in Medicaid funding due to the phaseout of the ACA’s Medicaid expansion and a change in the program’s funding formula. The bill would also cut $290 billion in funding for the premium tax credits that help pay for marketplace coverage, the CBO found.

Eliminating the individual mandate would save taxpayers $38 billion in penalties that must now be paid for not carrying coverage. The repeal of the ACA’s employer mandate would forgo $171 billion in government penalties, the CBO found.

In a statement, Dr. Andrew Gurman, president of the American Medical Association, said the revisions to the bill “offered no real improvements.”

“Millions of Americans will become uninsured – with low-income families on Medicaid being hit the hardest.”

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Lindsay Wise contributed to this report.

Lesley Clark: 202-383-6054, @lesleyclark

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