GOP health plan: Bad news for the old and poor

Price: We disagree strenuously with CBO report
Price: We disagree strenuously with CBO report

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Price: We disagree strenuously with CBO report 01:11

Story highlights

  • The Congressional Budget Office released its report on the Republican's American Health Care Act
  • Timothy Jost: It would make health coverage less accessible for old, poor; more affordable for young, high-income

Timothy Jost is an emeritus professor of law at Washington and Lee University. He is currently the Rockingham County (Virginia) Democratic committee chair. The opinions expressed in this commentary are solely those of the author.

(CNN)The Congressional Budget Office has issued its judgment on the Republicans' American Health Care Act, and the picture is not pretty.

Timothy Jost
The number of uninsured would increase by 4 million this year and by 24 million in 2026. Most of these people -- about 14 million of them -- would lose Medicaid coverage, but seven million Americans would lose employer coverage as well.
Premiums in the individual market would be 15 to 20% higher than they otherwise would have been during 2018 and 2019. After that, the CBO projects, premium growth would slow, but largely because the rating and subsidy structure under the Republican plan would drive older people out of the market as it drew younger people in.
    Indeed, the overall effect of the Republican plan, the CBO projects, is to make health insurance coverage less accessible for older and poorer Americans while making it more affordable for younger and higher-income Americans. The CBO also projects, however, that deductibles and other cost sharing would increase across the board, reducing premiums but increasing out-of-pocket costs and financial instability.
    So where is the good news? The CBO projects that the Republican plan would reduce the deficit by $336.5 billion over the next ten years. This change is overwhelmingly due to $880 billion in reductions in federal Medicaid spending -- a one-quarter reduction in Medicaid spending by 2026 -- and to reductions in the ACA's subsidies for insurance coverage for lower-income Americans, which are cut by $673 billion.

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    To a considerable extent, however, these are cost shifts rather than savings. States will have to pick up some of the increased Medicaid costs, while much of the cost of providing care for the low-income Americans who lose coverage will be borne by health care providers as bad debt and uncompensated care. And the bill includes $361 billion in new tax credits, which will disproportionately benefit younger and higher-income consumers.
    The best news in the CBO report is for the highest-earning Americans. The CBO estimates that the tax cuts in the bill for people earning a quarter of a million dollars or more a year ($200,000 for single filers) will come to $274 billion dollars over 10 years.
    One has to ask, however, whether these are the Americans who most need good news right now -- particularly given the millions of Americans for which this proposed legislation is very bad news indeed.