Your CBO Cheat Sheet: 5 Takeaways From GOP Health Bill

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The Republicans in the U.S. House voted for a health care bill on May 4 to dismantle "Obamacare," before the Congressional Budget Office had a chance to release its analysis. Three weeks later, the CBO determined how much the new bill would cost and how many Americans would become uninsured. (Mark Fiore/KQED)

An estimated 23 million additional Americans will become uninsured over the next decade if the current version of the Republican health care bill goes into effect, according to a Congressional Budget Office analysis released Wednesday.

This is only slightly lower than the 24 million predicted in March, before Republicans tweaked the bill to pull in critical votes from both moderate and hard-right Republicans. The bill passed the House on May 4.

The bill would save the federal government billions of dollars, compared to expected spending under the current Affordable Care Act. In addition, insurance premiums for individual consumers wouldn't rise as fast under the Republican health plan -- although that's because fewer old and sick people would be able to afford insurance.

One California consumer advocate, Anthony Wright, excoriated the Republicans for voting on this bill three weeks before seeing the CBO report.

"This is not normal, this is not the way health policy should be pursued," said Wright, executive director of Health Access California.

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"We believe the reason the House GOP leadership didn't want to wait for such an analysis ... was because they knew the disastrous impact," Wright said. "There's a reason why this was opposed by doctors and hospitals and patient and senior groups."

Here are five things you need to know now:

  • Republicans still haven't solved a big political problem: Increasing the number of uninsured Americans is bad optics. A bill that increases the number of uninsured by 23 million is not going to be any easier to spin than their previous bill, which predicted 24 million and drove voters to confront their representatives at town halls.
  • Republicans can still claim big budget savings: The CBO report predicts the House bill would reduce the federal deficit by $119 billion over a decade.
  • Listen closely when the talk turns to insurance premiums: The CBO says nongroup (that means insurance you don't get through your job) insurance premiums would go up for a few years under the GOP health plan, compared to the current ACA.  But after 10 years, those insurance premiums would be lower than they would be under the ACA. Key point: This is a relative "reduction" -- health insurance premiums still go up, but maybe not as much as they would under the ACA.
  • Well, why? Because healthier (customers) = cheaper (plans): The bill loosens regulations on insurance companies. For example, companies could design and price certain coverage plans that are aimed at younger (and healthier) consumers. Since many older and sicker Americans would be unable to afford insurance plans, insurance companies wouldn't have to pay their claims and could pass those savings on to other customers.
  • Local, local, local: Which state you live in matters. The GOP bill allows states to decide whether to eliminate two consumer regulations put in place by the ACA (restrictions on charging people with pre-existing conditions more, and requirements that all insurance plans cover 10 essential health benefits, such as maternity and mental health.) States that decide to keep the protections -- and California is expected to be one of them -- won't see the savings in premiums that other states might.

So, can California choose to avoid these predicted impacts? 

Nope. The Republican bill does more than allow states to choose to peel away ACA regulations. Even if California says "no thanks" on that, the bill also caps how much money every state will get for Medicaid going forward.

The bill would reduce federal funding for Medicaid by  $834 billion over 10 years — a massive amount, according to Jen Flory, an attorney with the Western Center on Law & Poverty.  She predicted California would have to cut benefits that aren't required under federal Medicaid law, such as prescription drug coverage, services for the blind, and nursing home care.

"These are some of the most vulnerable people, who are low-income, who have significant health needs and do not have any other way of bringing income in," Flory said. "It's almost too horrible to imagine what that actually looks like."

Since 2014, the ACA made it possible for California to cover an additional 3.7 million previously-uninsured adults through Medi-Cal.  The Republican bill changes eligibility rules so that most of those people would eventually lose their coverage.

Many conservatives have repeatedly called for changes to Medicaid that are similar to those outlined in the Republican bill.  They include Grace-Marie Turner,  who leads a D.C.-area policy organization that promotes market-oriented solutions for health care.

Turner believes the federal cuts could force state officials to curtail waste and be more efficient in how they administer Medicaid.

"I am convinced that the states can do a better job of running these programs than Washington can through micro-managing it," said Turner, who also wrote a book criticizing Obamacare.  "There is a great deal of savings to be had, if states had the incentive to do it."