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blog post
June 15, 2009
CBO and the Joint Committee on Taxation staff worked together to produce a preliminary analysis of the major provisions related to health insurance coverage contained in the Affordable Health Choices Act, drafted by the Senate Committee on Health, Education, Labor, and Pensions (HELP). The estimates are based on provisions from title 1 of the draft legislation released by HELP on June 9th. Among other things, the draft legislation would establish insurance exchanges (called gateways) through which individuals and families could purchase health insurance coverage. The proposed bill also would provide federal subsidies to substantially lower the cost of that coverage for some enrollees.
According to our preliminary assessment, enacting the proposal would result in a net increase in federal budget deficits of about $1.0 trillion over the 2010-2019 period. When fully implemented, about 39 million individuals would obtain coverage through the new insurance exchanges. At the same time, the number of people who had coverage through an employer would decline by about 15 million (or roughly 10 percent), and coverage from other sources would fall by about 8 million, so the net decrease in the number of people uninsured would be about 16 million or17 million.
These new figures do not represent a formal or complete cost estimate for the draft legislation, for several reasons. The estimates provided do not address the entire billonly the major provisions related to health insurance coverage. Some details have not been estimated yet, and the draft legislation has not been fully reviewed. Also, because expanded eligibility for the Medicaid program may be added at a later date, those figures are not likely to represent the impact that more comprehensive proposalswhich might include a significant expansion of Medicaid or other options for subsidizing coverage for those with income below 150 percent of the federal poverty levelwould have both on the federal budget and on the extent of insurance coverage.
CBO will continue to work on an ongoing basis with the HELP Committee and the other Senate and House committees involved in health care reform to provide estimates and analyses as legislation is developed.