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CBO Report on AHCA Not the Apocalyptic Meltdown Dems Predicted

The Congressional Budget Office (CBO) released its review of the House GOP’s health care reform law. Here are the 4 things you need to know.

1. The American Health Care Act (AHCA) will reduce the deficit

Right off the bat, the Congressional Budget Office (CBO) predicted that this law would reduce the federal deficit by $337 billion over the next 10 years. The legislation cuts tax revenues by $900 billion, but cuts spending by $1.2 trillion. As the GOP plans to pass the bill as a reconciliation measure, this aspect was crucial to the potential law’s survival.

2. Individual premiums will go up initially, but fall to 10% below Obamacare levels by 2026

The CBO estimates that single policy premiums under the AHCA would be 15 to 20 percent higher than Obamacare levels in 2018 and 2019. However, over the long term, these premiums would be 10 percent lower than Obamacare levels by 2026. The decrease in rising premiums would begin in 2020.

3. 14 million less people will be covered in 2018 than under Obamacare, but most of these will be voluntary

By 2018 14 million less people will have health insurance than they would under Obamacare.  However, according to the CBO, most of the uninsured would be voluntary withdrawals from the health insurance market. “Most of that increase would stem from repealing the penalties associated with the individual mandate.”  By 2026, 24 million less people would have health insurance than they would under Obamacare.  The CBO credits the 10 million person decrease to possible reductions in Medicaid expansion.

4. The CBO shot down Democrats’ ‘Sick Pool’ argument

Democrats have argued that healthy people withdrawing from health insurance market would create a ‘sick pool’ in the market. The argument goes that a ‘sick pool’ would either cause premiums to skyrocket or the insurance market would collapse. However, the CBO’s analysis shows that the AHCA maintains market stability. Subsidies and grants under the AHCA would prevent Democrats’ nightmare situation from unfolding.

You can read the full report here.