CHA News Article

CBO Estimates 24 Million Will Lose Coverage Under American Health Care Act

The Congressional Budget Office (CBO) has issued its cost analysis of the American Health Care Act (AHCA), estimating that the bill would increase the number of uninsured by 14 million in 2018 and 24 million by 2026, compared to current law. In addition, CBO estimates the AHCA’s per capita caps would cut federal funding for the Medicaid program by $880 billion from 2017-26. The CBO notes that this would likely require states to “cut payments to health care providers and health plans, eliminate optional services, restrict eligibility for enrollment, or (to the extent feasible) change the way services are delivered to save costs.” 

According to the report summary, CBO and the Joint Committee on Taxation estimate that enacting the legislation would reduce federal deficits by $337 billion between 2017 and 2026. The total includes $323 billion in on-budget savings and $13 billion in off-budget savings. Spending would be reduced by $1.2 trillion in the same time period, with revenue reduced by $0.9 trillion. The largest savings would come from reductions in spending for Medicaid and elimination of the Affordable Care Act (ACA) subsidies for nongroup health insurance. The largest costs would come from repealing many of the changes the ACA made to the Internal Revenue Code, including an increase in the Hospital Insurance payroll tax rate for high-income tax payers, a surtax on those tax payers’ net investment income and annual fees imposed on health insurers, as well as from a new tax credit for health insurance.

CHA is currently analyzing the CBO score and its impact on California’s hospitals and patients, and will provide members with additional details in the coming days. The full report is available on the CBO website.

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