CBO: Graham-Cassidy ACA repeal bill to reduce number of insured by 'millions'
The Congressional Budget Office, or CBO, and the staff of the Joint Committee on Taxation have analyzed the direct spending and revenue effects of legislation sponsored by Senators Graham, Cassidy, Heller, and Johnson that would replace certain federal subsidies for health care with block grants to states. Specifically, the agencies analyzed H.R. 1628, an amendment in the nature of a substitute posted on September 25, 2017, on Senator Cassidy's website. In the short time available, rather than provide the point estimates that are typical in such analyses, the agencies have been able to assess only whether any reductions in the deficit stemming from the legislation as a whole and from its two titles individually would exceed certain thresholds and to qualitatively assess its effects on health insurance coverage and market stability. Over the 2017-2026 period, CBO and JCT estimate, the legislation would reduce the on-budget deficit by at least $133B, the projected savings from the House-passed reconciliation bill. Those savings would occur mainly because, under the legislation, outlays from new block grants between 2020 and 2026 would be smaller than the reduction in net federal subsidies for health insurance. Funding would shift away from states that expanded eligibility for Medicaid under the Affordable Care Act and toward states that did not. The number of people with comprehensive health insurance that covers high-cost medical events would be reduced by millions compared with the baseline projections for each year during the decade, CBO and JCT estimate. That number could vary widely depending on how states implemented the legislation, although the direction of the effect is clear. The reduction in the number of insured people relative to the number under current law would result from three main causes. First, enrollment in Medicaid would be substantially lower because of large reductions in federal funding for that program. Second, enrollment in nongroup coverage would be lower because of reductions in subsidies for it. Third, enrollment in all types of health insurance would be lower because penalties for not having insurance would be repealed. Those losses in coverage would be partly offset by enrollment in new programs established by states using the block grants and by somewhat higher enrollment in employment-based insurance. Many of the new programs would probably cover people with characteristics similar to those of people made eligible for Medicaid by the ACA. The decrease in the number of insured people would be particularly large starting in 2020, when the legislation would make major changes to federal funding for Medicaid and the nongroup market. Publicly traded companies in the space include Aetna (AET), Anthem (ANTM), Centene (CNC), Cigna (CI), Health Net (HNT), Humana (HUM), Molina Healthcare (MOH), UnitedHealth (UNH) and WellCare (WCG). Reference Link MOH UNH CNC WCG CI ANTM HNT HUM AET