CBO: Health Insurance Proposal Lowers Rates 10-20 Percent

Posted on March 19, 2018

Contact:

Taylor Haulsee (Alexander)

Annie Clark (Collins)

Zach Hunter (Walden)

Natalie McLaughlin (Costello)

Washington, March 19, 2018 — Senate health committee Chairman Lamar Alexander (R-Tenn.), Senator Susan Collins (R-Maine), House Energy and Commerce Committee Chairman Greg Walden (R-Ore.) and Representative Ryan Costello (R-Pa.) today released the following statement on the Congressional Budget Office’s (CBO) analysis on their legislation to help lower premiums for Americans in the individual insurance market with permanent state flexibility, 3 years of invisible high risk pools/reinsurance, copper plans, and 3 years of cost-sharing reduction subsidies:

“This nonpartisan analysis shows that our proposal will lower individual insurance premiums 10 to 20 percent for farmers, songwriters, and small business men and women who don’t receive insurance from the government or from their employer and who pay for insurance on their own. CBO says premiums will be 10 percent lower nationwide on average next year, up to 20 percent lower on average for the estimated 60 percent of the population that lives in states that are projected to obtain 1332 waivers in 2020, and up to 20 percent lower for the 80 percent of the population that lives in states that are projected to obtain waivers in 2021.”

They added: “The report also says that the proposal will not add a penny to the federal debt, if the agency’s scoring is based on real spending—which shows that Obamacare subsidy spending has increased since cost-sharing reduction subsidies are not currently being paid.”

CBO today provided two estimates of the bill’s cost: One is based on the agency’s “baseline,” which has not yet been revised by the agency to show the federal subsidies are not being paid. The federal subsidies stopped in October.

The alternative score, which reflects the reality that Obamacare subsidy spending has increased since cost-sharing reduction subsidies are not currently being paid, shows the actual effect on the deficit if Congress passes the bill into law. The combined effect of the score and analysis shows the bill would pay for itself.

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