Report: Health plan would reduce deficit
CBO assessment could give bill new lease on life.
A new report shows a U.S. Senate health care compromise backed by Ohio Gov. John Kasich would reduce the federal deficit by $3.8 billion during the next decade while not reducing the number of Americans without health insurance.
The report, released Wednesday by the non-partisan Congressional Budget Office, could boost efforts by Senate Democrats and Republicans to pass a compromise brokered by Republican Sen. Lamar Alexander of Tennessee and Democratic Sen. Patty Murray of Washington.
Although House Republicans have said they will not bring the Senate version to the floor, the CBO report may intensify pressure on House GOP lawmakers. Backers say the agreement would help stabilize the federally subsidized insurance markets created by the 2010 health law known as Obamacare.
The compromise is designed to curb increases in the premiums charged by insurance companies for those federally subsidized policies. The bill would include what are known as cost-sharing payments for the next two years to keep some of the policies sold through the markets more affordable and provide $106 million to advertise the availability of those plans.
In addition, the bill would provide states with greater opportunities to design individual insurance policies, a key demand by Republicans.
“The Congressional Budget Office says that we can actually reduce the deficit modestly but also not have anybody removed from health under Alexander-Murray,” Kasich said in a video posted on Twitter. “It is a great thing to be for — stabilize our markets, save people’s health care, and move on to controlling health care costs.”
In a joint statement, Alexander and Murray said the CBO analysis “shows that our bill provides savings and ensures that funding two years of cost-sharing payments will benefit taxpayers and low-income Americans, not insurance companies.”
President Donald Trump this month chose to end the cost-sharing subsidies. But Murray and Alexander said without those cost-sharing payments, health insurance premiums in the federally subsidized market will leap by 20 percent next year.
They also said without their bill, “federal debt will increase by $194 billion over 10 years, due to the extra cost of subsidies to pay the higher premiums, and up to 16 million Americans may live in counties where they are not able to buy any insurance in the individual market.”
House Speaker Paul Ryan, R-Wis., gave a grim appraisal of the compromise agreement, telling Reuters Wednesday he cannot “imagine we can do that this year.”
Obamacare extended insurance to 40 percent of the roughly 46 million Americans who in 2010 were not insured by their employers, not old enough to qualify for Medicare or earned too much money to be eligible for Medicaid.
The law expanded eligibility for Medicaid, the joint federal and state program that provides coverage for low-income people, to allow families of four earning as much as $34,000 a year to qualify. Kasich relied on that section to cover more than 700,000 low-income Ohioans, using billions of dollars from the federal treasury to pay for it.
Obamacare also allowed the federal or state governments to establish exchanges in each state. Insurance companies offered four policies in those exchanges: bronze, silver, gold and platinum. A family of four earning as much as $98,000 a year could use federal tax credits to buy any of those plans.
For families of four earning up to $61,000 a year, there was an additional benefit: If they bought a silver plan, the federal government offered cost-sharing subsidies to reduce deductibles or other out-of-pocket expenses. Although Trump halted the subsidies, he called on Democrats and Republicans to find a fix for the instability in the markets.