On Wednesday, the Congressional Budget Office (CBO) released their score of the American Healthcare Act of 2017 (AHCA), twenty days after Republicans within the House of Representatives passed the bill. Their findings are less than ideal for the poor in the U.S., as twenty three million Americans are estimated to see a loss of coverage within the next decade as compared to the ACA. Particularly, within the next year there will be fourteen million more uninsured then there would be under the ACA. The effects will be dramatic and quick if the law is passed as is.
The deficit will also drop by $119 billion and premiums will go down in some areas, a point which will likely receive a lot of reverberation amongst conservative politicians. The effects of the bill, however, are not so simple. While it is true that premiums will go down for some, the benefits of their insurance will also drop due to relaxed regulations on insurance included in the bill. Particularly, allowing companies to discriminate based on the ill-defined category of pre-existing conditions will enable insurance companies to drop premiums for the healthy. Meanwhile, those with chronic conditions, expensive prescriptions, and general health issues will likely see their premiums rise, in some cases dramatically. Many will simply be unable to afford the care they need, or will be removed from their plans due to higher costs and lax regulations allowing for more limited coverage.
Also according to the CBO score, the health insurance market is estimated to become extremely unstable for a full sixth of the population. One of the key differences between this version of the AHCA and the version which failed to pass the House in March are amendments which allow states to apply for waivers releasing them from Obamacare requirements that insurance companies not discriminate by raising prices on those with pre-existing conditions and that insurance plans cover a set of essential health benefits. The CBO is predicting that as a result, the health insurance market will split into two segments. Healthy individuals will have low-premium, low-coverage plans in a stable market, while sick individuals will find their insurance in a “death spiral” of increasing premiums as higher costs and incomplete coverage drive anyone who can’t afford it out of that part of the market. This second market will be unstable, and particularly threaten to affect the poor and the elderly as well as the sick. Under AHCA, premiums on the elderly are likely to rise, possibly by a staggering 800%–or up to sixty percent of their income if they are earning a yearly income of $26,500 a year (according to a report by the Washington Post). A large segment of the population will find themselves paying much more for much less.
CBO estimates that in states requesting AHCA waivers, premiums for low-income elderly enrollees would go up 800 percent. That is not a typo. pic.twitter.com/W7QC4z9UUS
— Sarah Kliff (@sarahkliff) May 24, 2017
After years of complaints about the ACA being passed too quickly (despite a process that lasted more than a year), that the AHCA was passed in a matter of weeks and several weeks before the release of this CBO score seemed immensely irresponsible then. With the CBO now having given their estimates, it is obvious that it was, in fact, grossly irresponsible from both a process and a policy perspective. Tens of millions of Americans will lose insurance under the bill very soon and that number will continue to rise over the ten year estimate period, with an estimated 51 million people under the age of 65 left without coverage by 2026. Many will die or suffer from treatable conditions with no recourse. Others will experience extreme financial hardship just to stay alive.
Republicans will likely have a hard time arguing that the AHCA’s small decrease in the deficit is worth it to those individuals who will no longer be covered. However, the relatively small reduction does enable to Republicans in the House to submit the bill to the Senate for review and potential passage under reconciliation, a process allowing for passage of the bill via a simple majority. Hopefully, whatever decision Senate Republicans come to will be better for the American people than what has been passed by the House.