Latest Republican ACA stabilization plan comes with a $19B sticker price: CBO

Health insurance forms
Republican's latest attempts to stabilize the ACA marketplace would increase the deficit by $19 billion over the next 10 years. (Getty/vinnstock)

Republicans’ latest plan to stabilize the ACA exchanges—dubbed the Bipartisan Health Care Stabilization Act of 2018 (BHCSA)—would increase the deficit by $19 billion over the next 10 years if enacted, according to the Congressional Budget Office and the staff of the Joint Committee on Taxation.

However, another estimate by the budget office found revisions to the bill could actually reduce the deficit. 

The legislation (PDF) co-sponsored by four Republicans, Lamar Alexander and Susan Collins in the Senate and Greg Walden and Ryan Costello in the House, includes three years of funding for reinsurance and cost-sharing reduction payment as well as authorization for new "catastrophic" copper plans.

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The $19B estimate is mostly based on the cost of subsidizing reinsurance or invisible high-risk pool programs in the nongroup health insurance market.

The CBO added that the reduction in premiums associated with those programs would mostly benefit individuals with income greater than 400% of the federal poverty level.

RELATED: Republicans unveil their ACA stabilization plan, but House keeps it out of omnibus spending bill

CBO also produced an alternative estimate for the bill at Alexander's request, under what he calls a more realistic scenario. This estimate reflects the fact that insurers are not being separately reimbursed through an appropriation for the costs of CSRs. Under this scenario, appropriating funds for CSR payments through 2021 would reduce the deficit by $29 billion over the next decade.

The reduction would primarily come from smaller federal subsidies for health insurance plans by people with income between 200% and 400% of the federal poverty line.

This alternative estimate is not CBO’s official projection, but Congress could cite it during debate over the bill, which has already received pushback from Democrats due to abortion language in the legislation.

Passage of the bill will likely depend on whether the legislation is included in the must-pass omnibus spending package, which has a Friday deadline.

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