ACA Repeal and Replacement Bill [Update]

Note: This article is an update to the article: ACA Repeal and Replacement Bill.

The Congressional Budget Office (CBO) released its assessment of the American Healthcare Act on March 13.  This assessment represents a good faith estimate of the effects of the AHCA.  The actual effects may be different due to a number of factors.  According to the CBO, the ACHA will have the following effects.

  • The legislation will reduce the federal deficit by $337 billion over the 2017-2026 time frame. This consists of a $1.2 trillion reduction in outlays and a $0.9 trillion reduction in revenues.  Most of this reduction is due to changes in how Medicaid is budgeted.
  • In 2018, 14 million fewer people will have health insurance.  The majority of this number is due to people dropping coverage because of the elimination of penalties and people dropping coverage because of higher premiums.
  • As a result of the changes to the subsidies, the number of people without health insurance will increase to 21 million in 2020 and 24 million in 2026. These reductions will mostly be the result of the decrease in Medicaid funding.
  • The insurance market for individual policies will become unstable which could make premiums in that market unsustainable.  Policies in the nongroup market will be stable.
  • In 2018-2019, premiums will be 15-20% higher than they would have under the ACA.  Starting in 2020, premium increases will be offset by several factors.  By 2026, premiums will be 10% less than they would have under the ACA.
  • Some people will not see a decrease in premiums in by 2026 due to the change in how much insurance companies can charge older people.

References and Further Reading

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