New CBO score triggers backlash

Greg Nash

The Republican healthcare bill would result in 23 million fewer people with insurance over a decade, steep premium increases for older people and price hikes for many people with pre-existing conditions, the nonpartisan Congressional Budget Office (CBO) said Wednesday.

The long-awaited analysis of the ObamaCare repeal bill found that a controversial amendment from Rep. Tom MacArthur (R-N.J.) — added at the last minute to secure conservative votes — would have a significant effect despite Republican assurances to the contrary.

The amendment allows states to waive rules governing what an insurance plan must cover and lets insurers charge sick people more based on their health.

{mosads}The CBO said many states would likely take the waivers, thereby allowing insurers to charge sick people more. Some people with pre-existing conditions would then lose coverage because they could not afford the premiums despite extra funding that was added to mitigate that possibility, the CBO said.

“Unless you’re a healthy millionaire, TrumpCare is a nightmare,” said Senate Minority Leader Charles Schumer (D-N.Y.). “This report ought to be the final nail in the coffin of the Republican effort to sabotage our healthcare system.”

The Trump administration, which spent significant political capital getting the bill through the House, slammed the analysis.

“The CBO was wrong when they analyzed Obamacare’s effect on cost and coverage, and they are wrong again,” Health and Human Services Secretary Tom Price said in a statement. 

“In reality, Americans are paying more for fewer healthcare choices because of Obamacare, and that’s why the Trump Administration is committed to reforming healthcare.”

In a bright spot for the GOP, the CBO found the bill would reduce the deficit by $119 billion over 10 years. That’s less than the $150 billion reduction projected for the previous version of the bill, but still enough savings that the House won’t have to vote on the bill again before officially sending it to the Senate.

Other aspects of the analysis — from the number of uninsured people to the effect of Medicaid cuts — were mostly unchanged from the CBO’s initial score in March

The report seemed to harden the resolve of Senate Republicans to move in a different direction.

In a flurry of statements, Senate Republicans stressed that they are starting fresh on the healthcare bill and that it will be changed significantly — and scored again by the CBO — before it becomes law.

 “While I am in favor of repealing ObamaCare, I am opposed to the American Health Care Act (AHCA) in its current form,” Sen. Dean Heller (R-Nev.), who faces a close reelection race next year, said in a statement. “This bill does not do enough to address Nevada’s Medicaid population or protect Nevadans with pre-existing conditions.”

Sen. Bill Cassidy (R-La.) said any healthcare bill passed by the Senate must not allow people to be denied coverage, citing Jimmy Kimmel’s now-famous plea on behalf of people with pre-existing health conditions.

“Congress’s focus must be to lower premiums with coverage which passes the Jimmy Kimmel Test,” Cassidy said in a statement. “The AHCA does not. I am working with Senate colleagues to do so.”

Senate Republicans have formed a working group to draft a new healthcare bill but are facing significant headwinds in finding consensus. Their conference is divided on issues such as Medicaid cuts and the waivers for states out of minimum coverage requirements and the rules for pre-existing conditions.

Senate Majority Leader Mitch McConnell (R-Ky.) told Reuters earlier Wednesday: “I don’t know how we get to 50 [votes] at the moment. But that’s the goal.”

“And exactly what the composition of that [bill] is I’m not going to speculate about because it serves no purpose,” he added.  

Perhaps the biggest outstanding question for the Senate is what to do about the MacArthur amendment, which has pushed pre-existing conditions to the center of the legislative debate.

The CBO projected that a substantial number of people would live in states that would take advantage of the new waivers.

One-sixth of the population would live in states that took full advantage and waived both rules, the CBO found. People with pre-existing conditions in those states would have difficulty affording coverage.

“Over time, it would become more difficult for less healthy people (including people with preexisting medical conditions) in those states to purchase insurance because their premiums would continue to increase rapidly,” the report said.

While the Senate indicated it is doing its own work, House Republicans defended their bill.

MacArthur dismissed the CBO’s conclusion that his amendment would hurt people with pre-existing conditions.

“I don’t agree with them that waivers will destabilize [the market],” MacArthur told reporters Wednesday. “I think waivers will cover people with pre-existing conditions because they’ll have to create risk pools.”

“I respect the CBO’s role, but just because a group of auditors down the block have created a model that has a lot of ifs, ands and maybes, looking out 10 years, doesn’t make that the gospel,” he added. “That is somebody’s opinion at CBO. I have a different opinion.”

Rep. Mark Meadows (R-N.C.), who negotiated the amendment on behalf of the Freedom Caucus, rejected the CBO’s claim that the bill could destabilize the market for sicker people. 

“I don’t know how you can get anymore unstable then what we are right now. A lot of states are down to one carrier. I’m not sure how you can get less stable that than. I guess we go to negative-one providers in a state?” he said.

Much of the debate between Republicans and Democrats has been over whether ObamaCare is currently “collapsing.” The CBO found that the market under the current law will be “stable in most areas,” and that while premiums have been rising, most people are protected by government subsidies under the law. 

Another thorny political issue for Senate Republicans is how to lower premiums.

Premiums for healthy people would be lower under the House bill, but with a wide variation, the CBO found.

Overall, premiums would increase for two years before they decreased — by 20 percent in 2018 and 5 percent in 2019. After 2020, premium costs would depend on which states get waivers and how much funding they get from the proposal’s Patient and State Stability Fund.

Many GOP lawmakers had already expressed concern about price spikes for older people under the bill. In the updated version, the price increases would also be dramatic in states that got waivers from the ObamaCare rules.

Premiums could rise as much as 800 percent for a 64-year-old making $26,500, the CBO found — from $1,700 to $13,600.

Rep. Fred Upton (R-Mich.) led a last-minute effort to add $8 billion to the bill to reduce premiums in states that waived ObamaCare rules. But the CBO found that money would not be enough.

The funding “would not be sufficient to substantially reduce the large increases in premiums for high-cost enrollees,” the analysis said.  

The measure would still have a large cut to Medicaid, estimated at $834 billion over 10 years. The CBO estimates that cut would lead to 14 million fewer people being covered under the program.

The bill would cut taxes by an estimated $992 billion. Most of those tax cuts would go to higher earners.

Overall, the bill repeals the core parts of ObamaCare, including its subsidies, mandates, taxes and Medicaid expansion, and puts in place a new system with a new tax credit to help people buy coverage. That tax credit would provide less help on average than financial assistance under ObamaCare, however.

Tags Charles Schumer Dean Heller Mitch McConnell

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