Breaking down the new CBO score of the AHCA

Yesterday the Congressional Budget Office (CBO) released its score of the latest version of the H.R. 1628, American Health Care Act (AHCA) of 2017. Not surprisingly, the analysis revealed that, compared to the Affordable Care Act (ACA), millions more Americans will be without insurance, plans will cover less, and rates could increase drastically for those with pre-existing conditions.

Here are the highlights of the new CBO score, as well as a comparison to the CBO scores of previous versions of the bill.  

Minimal change to uninsured population

The projected number of uninsured Americans under the most current version of the AHCA is relatively the same as previous iterations: 23 million fewer Americans by 2026. The previous CBO scores of the AHCA predicted 24 million fewer Americas would be insured by 2026 than under the ACA.

Premiums on the rise

The CBO estimates the AHCA would increase premiums 20 percent in 2018 relative to the ACA, and 5 percent in 2019. Premium costs for 2020 and beyond would largely depend on how many individual states apply for and receive waivers from Essential Health Benefit (EHB) requirements, along with Health Status Underwriting and Age Ratio Underwriting requirements.

As a whole, premium costs would go down for some people, especially younger, healthier Americans, but out-of-pocket costs have the potential to skyrocket.

Federal deficit would decrease

The bill would generate savings of $119 billion over a 10 year period -- less than the $337 billion in savings projected in the original score on March 13, and the $150 billion in savings from the second score on March 23.

Increase to overall cost of health care

While premiums may decrease for healthy individuals, especially in states that receive waivers from EHB and underwriting regulations, the overall cost of health care, including out-of-pocket expenses, would dramatically increase. This is due to plans covering less and the removal of cost containment rules, like bans on annual and maximum limits. 

CBO chart

As you can see, the end result of the AHCA is not much different from prior CBO scores: premiums would rise, the uninsured population would rise, and the deficit would decrease. While the new CBO score means the AHCA will move forward in Senate deliberations, especially because it meets the budget reconciliation threshold, there’s still a long road ahead until the bill makes it to the President’s desk. We will continue to follow the AHCA and keep you informed of all health care reform developments.