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Healthcare Repeal: How Would It Affect Coverage And Cost?

[Soon] the new GOP-controlled House of Representatives will be voting on and is expected to pass a bill to repeal the Affordable Care Act (ACA) — lock, stock, and barrel. There is virtually no chance the repeal bill will get through the Senate, though, which maintains a narrow Democratic majority, and President Obama would veto it if it did.

But let’s say that the seemingly impossible happened, and the ACA was repealed. What would the impact be on healthcare coverage, costs, and the federal deficit?

In a letter to Speaker John Boehner (R-OH), the Congressional Budget Office (CBO) released its preliminary estimates of the impact of repeal on the deficit, uninsured, and costs of care, and found that it would make the deficit worse, result in more uninsured persons, and higher premiums for many:

— Deficit: repeal of the ACA would increase the deficit by $145 billion from 2012-2019, by another $80 to $90 billion over the 2020-21 period, and by an amount “that is in the broad range of one-half percent of the GDP” in the decade after 2019* — or about a trillion dollars.

[*Ordinarily, the House of Representatives would have to find “offsets” to pay for such increased deficit spending from legislation, but it exempted the ACA repeal bill from this requirement. Republican leaders have justified this on the grounds that they disagree with the CBO’s estimates. But under Congress’ own, long-standing budget rules, accepted by both political parties, the CBO is the referee, and the referee decides how much a bill will increase or decrease the deficit, not the party that is in control of Congress at a given time. The result is that the increased deficit spending from repeal would show up in future CBO “baseline” deficit spending estimates, making it much harder for Congress to balance the budget.]

— Federal budgetary commitment to healthcare: Repeal would lower the federal budgetary commitment to healthcare over the next decade but increase it in subsequent years. In other words, if the ACA is repealed, the federal government would pay less now, but more later for healthcare.

— Coverage: Repeal would result in 32 million fewer non-elderly persons having health insurance, leaving about 54 million uninsured. The share of legal non-elderly residents with insurance in 2019 would be 83 percent compared to 94 percent under the ACA.

— Premiums: Healthcare premiums for individual insurance would be “somewhat lower” but “on average…many people would end up paying more for health insurance coverage — because under [the ACA], the majority of enrollees purchasing coverage in that market would receive subsidies via the insurance exchanges, and [repeal] would eliminate those subsidies.” Premiums for employment-based coverage from large employers would be “slightly higher” under repeal than under the ACA. Premiums for employer-based coverage through small employers might be “slightly higher or lower” reflecting uncertainty about the impact of the ACA on premiums in that market.

Repeal, of course, would also eliminate all of the provisions of the ACA, including rules to end discriminatory practices against people with pre-existing condition exclusions, coverage of adult children on their parents’ plans, the new 10 increase increase in Medicare payments to primary care physicians, the new Medicare wellness examination preventive and other screening procedures now available free of charge to beneficiaries, the phase-out of the Medicare Part D doughnut hole, the requirement that insurers spend more on patient care and less on administration, and much, much more.

There is something to be said for politicians trying to deliver on campaign pledges. The GOP promised voters that it would try to repeal the ACA, so it is no surprise and maybe even a bit refreshing that repeal is one of the first things out of the starting gate.

But the evidence is that if the ACA is repealed, the country would have a bigger deficit, more uninsured people, higher out-of-pockets costs and premiums, reduced Medicare benefits, reduced pay to primary care doctors, and elimination of many other popular and beneficial programs created by the ACA. Is this really what the people want?

Today’s question: What is your reaction to the CBO’s finding that repeal of the ACA will increase the deficit, lead to more uninsured persons, and higher premiums and out-of-pockets costs for many?

*This blog post was originally published at The ACP Advocate Blog by Bob Doherty*

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