https://goo.gl/ZGkz6Z
Yesterday, the Congressional Budget Office (CBO) released its estimate of the effects of a bipartisan health care bill drafted by Senators Lamar Alexander (R–Tenn.) and Patty Murray (D–Wash.) to help stabilize the Affordable Care Act (ACA) marketplaces. CBO projects that the Bipartisan Health Care Stabilization Act would save the federal government $3.8 billion by 2027. In contrast to this year’s Republican-led repeal-and-replace bills, which were estimated to lead to as many as 32 million people losing insurance, the bill would preserve coverage gains made under the ACA. But the bill is limited in scope and is not expected to substantially increase coverage, either.
Making Good on an IOU…
One of the most important provisions in the bill would appropriate the money to pay for so-called cost-sharing reductions (CSRs). These federal payments reimburse insurance companies for lowering deductibles and copayments for lower-income people with marketplace plans. The Trump administration ended those payments two weeks ago, calling them a bailout for insurers. But because insurers are required to offer the discounts to consumers and the federal government is required to pay for them, in its analysis, CBO assumed the payments were already an obligation of the federal government. This means the bill’s formal appropriation for the money won’t increase the deficit; it simply makes good on an IOU.
Since most insurers have already increased their premiums for the coming year to compensate for the anticipated lack of CSR payments, the Alexander–Murray bill won’t affect 2018 rates. Rate-setting for the 2018 plan year was fraught for states and insurers given the uncertainty about whether cost-sharing payments would be made. But if passed, the bill would reassure insurers who are already planning for 2019 and encourage more stability.