CBO Score Muddies American Health Care Act Debate

Published June 28, 2017

A hotly disputed Congressional Budget Office analysis says the version of the American Health Care Act (AHCA) passed by the U.S. House of Representatives would result in lower health insurance premiums and fewer insured individuals than under the Affordable Care Act (ACA).

Premiums would decline by 20 percent under AHCA in the approximately one-third of states likely to apply for federal waivers allowing them to opt out of certain Obamacare mandates, CBO stated in an estimate on May 24.

CBO also estimated the bill would cause 23 million fewer individuals to have health insurance by 2026.

A version of the bill, called the Better Care Reconciliation Act, remains under consideration by the Senate.

Questioning Assumptions

Seth Chandler, a visiting scholar at the Mercatus Center at George Mason University, says the CBO score grossly overestimates the number of people likely to be enrolled in the Obamacare exchanges if ACA stays intact.

“Nobody thinks there are 15 million people enrolled in the exchanges this year,” Chandler said. “Nobody, left [or] right, nowhere, thinks there are going to be 18 million people enrolled on the exchanges next year.”

Scott Ehrlich, chief operating officer at DTC Perspectives, a company promoting better communication about health care and greater patient knowledge, says CBO’s faulty criteria for scoring the bill are traceable to CBO’s score of ACA.

“[The score] has made any sort of repeal to Obamacare that much harder because the ACA was run through a whole bunch of simulations, and a whole bunch of numbers were put in there to make it gain as favorable of a CBO number as possible,” Ehrlich said.

Improvements AHCA would make on Obamacare will register as setbacks by the standards CBO developed to pad its score of ACA, Ehrlich says.

“Anything that would repeal [the ACA] would therefore be dealing with changing a number that was artificially pumped up to gain a good CBO number, making anything done through the CBO look worse than what the result probably is,” Ehrlich said.

Debate Darkener?

CBO’s estimate ensures Senate Republicans will shy away from the bill, Ehrlich says.

“I think [the CBO’s score] is significant in that it puts a very negative number that is going to put Republicans that weren’t exactly head-over-heels in love with this bill, especially in the Senate, even further on the defensive and give them another reason to vote against it or put out a bill that is significantly different than this one in the Senate rather than simply voting to approve this one,” Ehrlich said.

Chandler says measuring AHCA against CBO’s earlier, faulty ACA score perpetuates a destructive pattern.

“What I think the unfortunate effect of the CBO’s obstinacy is, is that not only is the debate over the AHCA messed up, but there are going to be other proposals that come down the pipe,” Chandler said. “If those bills are held to a fantasy ACA standard, then the debate becomes very difficult, and needlessly so.”

Subjective Scoring

Congressional Republicans have done little to obtain an objective score of the bill, Chandler says.

“The Republicans have to own to some of the responsibility first, because they have never really seriously tried to get an objective, external score of their proposals,” says Chandler. “We actually need to do this soon. We don’t have the luxury of waiting a year to figure this thing out.”

The number of people who would have insurance under AHCA is a poor measure of whether the bill would help most patients, Chandler says.

“When the only metric you have of the success of a bill is how many people end up insured, that’s really a flawed measure,” Chandler said. “You need to [ask], ‘How much is it going to cost? What are the increased taxes likely to do to the economy?'”

Ehrlich says free-market health care reform at the congressional level is unlikely without repeal of Obamacare’s regulatory structure.

“To try to basically maintain the structure of the ACA but push it in a more free-market direction just isn’t possible, because the ACA is set up to have so many different moving parts,” Ehrlich says. “Instead of trying this repeal-and-replace strategy, you [should] repeal it, and then you rebuild from the ground up.”

Hayley Sledge ([email protected]) writes from Springboro, Ohio.

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