Senate Bill Replacing ACA Leaves 22M More Uninsured, CBO Says

June 26, 2017

A Senate bill that largely repeals and replaces the Affordable Care Act (ACA) would add 22 million more Americans to the ranks of the uninsured by 2026 compared with current law, just a million less than what's forecast for its House counterpart, according to an analysis by the nonpartisan Congressional Budget Office (CBO).

The Senate bill, called the Better Care Reconciliation Act (BCRA), also would reduce the federal deficit by a net $321 billion over the next 10 years, $202 billion more than what the House bill would save, the CBO said in a report released today.

The BCRA would achieve its savings in part by decreasing federal contributions to Medicaid by $772 billion through 2026, a 26% reduction. That's somewhat less than the $834 billion that the House bill, called the American Health Care Act (AHCA), would excise from Medicaid, according to the CBO. The agency projects 15 million fewer Medicaid enrollees by 2026 under the BCRA than if the ACA remained in effect.

There also would be 7 million fewer people covered by private insurance purchased on the state marketplaces, or exchanges, created by the ACA. The BCRA's elimination of the tax penalty for not obtaining coverage would depress enrollment, as would a combination of factors that make health plans sold on the exchanges less financially attractive, the CBO explained.

Through 2019, the legislation would increase the average premium for a so-called benchmark plan on the exchanges more so than if the ACA remained in place. That's because insurers would have to raise their rates as they lose young, healthy, and easy to insure individuals who are no longer goaded into purchasing coverage by the individual mandate penalty. But beginning in 2020, the BCRA would undercut the ACA on benchmark plan premiums — by 20% in 2026 — in part because the benchmark plan wouldn't be worth as much.

The ACA's benchmark, called a silver plan, has an actuarial value of 70%, meaning that the insurer pays 70% of the cost of covered benefits. In 2020, the BCRA would set the actuarial value of its benchmark plan at 58% — just 2 percentage points below the ACA's bronze plan. The lower the actuarial value, the higher the deductible, making the plan less appealing, the CBO said. The equivalent of a silver plan would come with a lower deductible, but a steeper premium. And for most people, the BCRA's average premium subsidy would be substantially less than what the ACA offers.

"As a result, despite being eligible for premium tax credits, few low-income people would purchase any plan," the CBO said.

Bill Violates "Do No Harm" Principle, AMA Says

Republican leaders in the Senate had hoped to hold a vote on the BCRA before their Fourth of July recess. However, winning over at least 50 GOP supporters —and a tie-breaker by Vice President Mike Pence in that event — for passage could be a challenge, given how the Senate bill is only slightly less severe than the AHCA in terms of rolling back gains under the ACA. Some moderate Senate Republicans have expressed discomfort with the prospect of tens of millions of people losing insurance coverage. And the bill has failed to win the support of the some conservative Senate Republicans, who say it doesn't go far enough in junking the ACA.

The BCRA has already been panned by major medical societies for reducing healthcare coverage, particularly in the Medicaid program. One of the most strongly worded criticisms from organized medicine came today from the American Medical Association (AMA). In a letter to the US Senate, AMA Executive Vice President and CEO James Madara, MD, said the BCRA in many ways violates the physician's imperative of "first, do no harm".

"We believe that Congress should be working to increase the number of Americans with access to quality, affordable health insurance instead of pursuing policies that have the opposite effect," Dr Madara wrote.

Follow Robert Lowes on Twitter @LowesRobert

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