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CBO Scores Latest Senate GOP Health Care Bill Without Key Policy

A new Senate GOP health care bill would lead to 22 million fewer people insured, according to the CBO, but analysis is missing a key policy provision.
Image: US President Donald Trump speaks alongside Republican Senators during a meeting to discuss the health care bill
US President Donald Trump speaks alongside Republican Senators during a meeting to discuss the health care bill in the State Dining Room of the White House in Washington on July 19, 2017.Saul Loeb / AFP - Getty Images

WASHINGTON — A new health care bill from Senate Republicans would lead to 22 million fewer people insured after a decade while saving $420 billion in federal spending, according to a report by the Congressional Budget Office.

But the draft bill Republicans submitted was most notable for what it left out: An amendment by Senator Ted Cruz, R-Texas that would allow insurers to sell plans that don’t include protections for pre-existing conditions or guarantee a minimum set of benefits.

CBO staff said in a conference call on Thursday that they are still evaluating the Cruz amendment’s impact, but offered no update on when they might release their findings.

Some version of the amendment is expected to be in any Obamacare replacement bill and could have potentially large affects on the rest of the legislation.

Conservatives say the measure is crucial to their support, arguing that it will improve the market by allowing customers to purchase cheaper plans that are less comprehensive than those required under Obamacare.

But health experts have warned it could lead insurers to herd young and healthy customers into ultra-cheap plans while sending premiums skyrocketing for older and sicker Americans who require more robust coverage. It could potentially affect benefits for employer-based insurance as well. AHIP, the top insurance lobby, fiercely opposes the idea.

The bill the CBO scored did include an additional $70 billion in funding for states intended to help implement the Cruz plan.

The report found the latest version of the Senate bill would reduce raw premiums 25 percent by 2026 after an initial increase, but would provide less subsidies to pay them and encourage people to buy into plans with higher deductibles.

In some cases, the increase would be vast: An individual making $26,500 in 2026 could expect a deductible of $800 under Obamacare, but $13,000 under the Senate bill — a roughly sixteen-fold increase — thanks to its cuts to subsidies.

Similar to prior iterations of the bill, the CBO found the latest version would reduce Medicaid spending by large amounts in comparison to current law: $756 billion over the next decade, only a slight shift from a $772 billion drop in the previous bill.

The CBO may not be able to evaluate the Cruz amendment in time for an expected vote next week. Senators are reviewing a separate analysis of the amendment by the Department of Health and Human Services and some have floated a near unprecedented procedural maneuver to use its findings instead of the CBO’s.

A copy of the HHS analysis posted by the Washington Examiner and confirmed by a Republican aide was broadly positive, finding it would lower premiums and increase coverage overall.

But the report was sharply criticized by outside health experts, who said it used confusing and opaque methodology and featured misleading charts that made the amendment’s effects look more favorable. The HHS report evaluated how the amendment would impact the Affordable Care Act rather than how it would affect the Republican replacement bill.