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Five Things to Know About the GOP Health Care Plan's Score

The Congressional Budget Office has issued its report on the new Republican health care plan and it’s bad. Here's a quick rundown.
Image: House Speaker Paul Ryan (R-Wis.) discusses the American Health Care Act at a news conference on Capitol Hill in Washington.
House Speaker Paul Ryan discusses the proposed American Health Care Act at a news conference on Capitol Hill on March 9.Gabriella Demczuk / The New York Times via Redux Pictures

The Congressional Budget Office has issued its report on the new Republican health care plan — and it’s bad news for the GOP. The nonpartisan CBO is considered the gold standard for judging the impact of new bills, even if it’s not perfect.

Health and Human Services Secretary Tom Price says the CBO numbers “defy logic” even as House Speaker Paul Ryan, who’s pressed the plan forward, says it vindicates him by showing the plan cuts spending.

Here are five things to know about what the CBO said:

It would cut the deficit...

The CBO projects that the plan, if enacted, would cut the federal budget deficit by $337 billion by 2026

...because it slashes Medicaid

The plan restructures the state-federal Medicaid health plan for the low-income, disabled and elderly. It limits what the federal government puts into the plan — to the tune of $880 billion — and would result in 14 million fewer people being covered by Medicaid.

It would cover many fewer people

About 24 million fewer people would be covered by 2026 compared to now, the CBO estimates. Besides the 14 million losing Medicaid coverage, the plan would also pull federal subsidies from low-income customers who buy non-group plans on the private Obamacare markets.

It would raise premiums, at first

Premiums would go up as healthy people drop out of health insurance and companies struggle to bring in enough cash to pay out on their remaining, presumably sicker, customers. But the CBO projects premiums would be 10 percent lower by 2026. This would be in part because companies could offer skimpier, cheaper health insurance plans — except for older people. A 64-year-old would pay up to 25 percent more.

Bare-bones plans would come back

The GOP proposal eventually lets companies offer skimpier, cheaper health insurance plans. These are attractive to younger, healthier people who gamble that they won’t get heart disease or cancer, but can mean higher rates for older people, even if they are not sick. The Affordable Care Act currently specifically seeks to limit these plans as much as possible because they sometimes slammed customers with sky-high deductibles and co-pays.