Millions of Americans could lose their health coverage and insurance premiums could see double digit spikes if major provisions of the Affordable Care Act (ACA) are repealed and not replaced, according to a Congressional Budget Office (CBO)and Joint Committee on Taxation (JCT) report released Tuesday.
Democratic leaders in Congress requested the report, which was released amid Republicans' efforts to repeal and replace the ACA. Its projections are based on a bill (HR 3762) Congress approved in 2015 that would have repealed major ACA provisions, including the law's coverage mandates, subsidies, and Medicaid expansion. The bill would have maintained the ACA's protections for individuals with pre-existing conditions. President Obama vetoed the measure.
The report does not consider any plans to replace ACA provisions.
The report estimated that if the ACA's individual and employer mandates are repealed and a replacement plan is not implemented, 18 million U.S. residents could lose their health plans during the first year following the repeal.
In addition, the report projected that the number of uninsured U.S. residents would increase to 32 million by 2026 if the ACA's subsidies to help individuals purchase health plans and Medicaid expansion also were eliminated. In such a case, CBO and JCT projected:
- About 23 million fewer people would have coverage through the individual market;
- About 19 million people would lose Medicaid coverage; and
- Approximately 11 million people would gain coverage through employer-sponsored health plans.
Further, the report predicted that eliminating the law's coverage mandates would "change the mix of people with insurance" because younger and healthier individuals could be more likely to forgo coverage. As such, the report projected that individual health plan premiums likely would increase by between 20 and 25 percent from current rates during the first year following the repeal, and could double by 2026.
The report also estimated that in the first year after repeal, about 10 percent of U.S. residents would be living in an area with no insurers participating in the individual market. By 2026, that number could increase to 75 percent of the U.S. population, according to the report.
Overall, the report predicted that eliminating the ACA's coverage mandates and subsidies, "while retaining the [law's] market reforms would destabilize the nongroup market, and the effect would worsen over time."
Both Republicans and Democrats were quick to respond to the report.
Senate Finance Committee Chair Orrin Hatch (R-Utah) noted that the report only considered repealing major ACA provisions and did not consider "any transitional policies or reforms to address costs and empower patients." He added, "Republicans support repealing [the ACA] and implementing step-by-step reforms so that Americans have access to affordable health care."
Others cautioned that the 2015 bill on which the report is based might not necessarily reflect the GOP's current plans to repeal and replace the ACA.
AshLee Strong, a spokesperson for House Speaker Paul Ryan (R-Wis.), said the report's projections were "meaningless" because "it [took] into account no measures to replace the law nor actions that the incoming administration will take to revitalize the individual market that has been decimated by" the ACA.
Similarly, a spokesperson for Senate Majority leader Mitch McConnell (R-Ky.) said, "This report assumes a situation that simply doesn't exist and that no one in Congress advocates."
Meanwhile, Democrats cited the report's findings as evidence that repealing the ACA would have devastating effects.
Senate Minority Leader Chuck Schumer (D-N.Y.) in a statement said, "Nonpartisan statistics don't lie: It's crystal clear that the Republican effort to repeal the [ACA] will increase health care costs for millions of Americans and kick millions more off of their health insurance." He added, "The numbers are even worse than experts could have imagined."
Separately, HHS Secretary Sylvia Mathews Burwell said the CBO report showed the "analytics and real numbers [of] what happens" if Republicans repeal the ACA without immediately implementing a plan to replace the law.
Tim Jost, a professor at the Washington and Lee University School of Law, in a Health Affairs blog post acknowledged that the report's estimates are preliminary, as future CBO projections would change to account for future congressional action. However, he wrote that "the Jan. 17 CBO report is a sobering reminder that the nongroup insurance market is fragile, and ill-considered action can have devastating results" (Mascaro, Los Angeles Times, 1/17; Pear, New York Times, 1/17; Haberkorn, Politico, 1/17; Lagasse, Healthcare Finance, 1/17; Rovner, Kaiser Health News, 1/17; Hellmann, The Hill, 1/17; Hersher, "The Two-Way," NPR, 1/17; Eilperin et al., "PowerPost," Washington Post, 1/17; Jost, Health Affairs Blog, 1/17).
5 must-have upgrades for the consumer-focused health system (with or without the ACA)
Failure to prepare for today's consumer-driven reality is a risky strategy in any market. Increased out-of-pocket costs, the improvement of price transparency tools, the emergence of meaningful alternatives to traditional care sites, and the weakening of the traditional patient-physician relationship have accelerated the growth of a consumer market.
Health systems that do not build real consumer loyalty are in danger of losing substantial share to new competitors. If they hope to grow, organizations must build long-term durable relationships with their customers. Check out this infographic to see five upgrades health systems should make to succeed in this new era of health care.