CBO Trashes GOP Health Plan — Less Coverage Expansion, Less Deficit Reduction
The Congressional Budget Office has released its initial estimate of the House GOP’s health care alternative, centered on the near-total deregulation of the health insurance industry.
The good news is that the House GOP bill does reduce the deficit. CBO says adopting their plan would reduce the deficit by $68 billion over ten years relative to current law. The number for the Democratic bill, however, is $104 billion. So in exchange for that lesser deficit reduction, the Republicans must cover more people right? Well, of course not. Instead, under the Boehner Plan the number of people without health insurance will stay steady at 17 percent. The Democratic plan will see that sliced to just four percent.
The CBO also says that for most people the GOP plan won’t lower premiums: “In the large group market, which represents nearly 80 percent of total private premiums, the amendment would lower average insurance premiums in 2016 by zero to 3 percent compared with amounts under current law.” And insofar as their plan does reduce premiums, it’s by making your coverage worse:
The second source of change in average insurance premiums is changes in the average extent of coverage purchased. Those changes can reflect both changes in the scope of insurance coverage—the benefits or services that are included—and changes in the share of costs for covered services paid by the insurer—known as the “actuarial value.” With other factors held equal, insurance policies that cover more benefits or services or have smaller copayments or deductibles have higher premiums, while policies that cover fewer benefits or services or have larger copayments or deductibles have lower premiums. Provisions in the amendment that would reduce insurance premiums by affecting the amount of coverage purchased include the State Innovations program, which would encourage states to reduce the number and extent of benefit mandates that they impose, and provisions that would allow individuals or affiliated groups to purchase insurance policies in other states that have less stringent mandates.
To repeat myself from yesterday, this is basically a plan that works well for you if you never get sick. Instead of wasting money on taxes and or premiums to cover your own illness or that of your fellow Americans, you’ll have more money in your pocket to spend on NBA League Pass or what have you. If you’re uninsured or at risk of losing your insurance, this plan does nothing for you. If you’re insured and putting your insurance to use by getting sick, this plan is a disaster, offering you less coverage.
11 Responses to “CBO Trashes GOP Health Plan — Less Coverage Expansion, Less Deficit Reduction”
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November 5th, 2009 at 11:00 am
To repeat myself from yesterday, this is basically a plan that works well for you if you never get sick.
ObGrayson: And if you do get sick, hurry up and die.
He successfully predicted their plan before they had even written it. Maybe he has a mole inside some Republican’s staff or something.
November 5th, 2009 at 11:04 am
The good thing about this plan is that Democrats now have concrete choices for those who don’t like this bill 100%. Vote for yours, vote for theirs, or vote for their other one. But don’t think that electoral consequences apply only to Democrats.
November 5th, 2009 at 11:24 am
So in exchange for that lesser deficit reduction, the Republicans must cover more people right?
What a silly assumption. The GOP has less deficit reduction because it doesn’t slash Medicare spending by $400+ billion.
The Democrats want to balance the budget on the backs of old people by destroying Medicare, to the tune of $400 billion in spending reductions.
Democrats hate old people and want to take away the benefits they’ve been promised for decades.
November 5th, 2009 at 11:31 am
Given the loads of horseshit your average Democrat has swallowed thus far, how can you honestly criticize Republicans?
Hell, most of you don’t even bother pretending to believe that Obama has some sort of master plan to clean up government, put torturers in jail, or reform healthcare. You have instead shifted to the idea that none of that really matters, is impossible, or was just a load of BS to get the rest of us to go along with you.
There are no choices in America.
November 5th, 2009 at 11:37 am
The GOP bill is deeply flawed, but what serious person believes the Democratic bill will leave in place the 21 percent reduction in the payment rates for physicians necessary to reduce the deficit by $104 billion. Honest progressives should admit this figure is a dishonest budget gimmick.
November 5th, 2009 at 12:00 pm
Al,
That’s some serious irony there. Even if your allegations were true, conservatives have spent the last two decades complaining about how unsustainable medicare is and how benefits will eventually have to be slashed (or the program abandoned altogether). And I can’t imagine the teabaggers doing anything but slashing those services should they ever get a chance to enact their agenda. So if the Democrats have a plan to limit future increases in medicare costs while keeping quality of care high, this is bad for old people? Given the alternatives that the Republican party has offered, I’m not sure how any sane person could reach that conclusion.
November 5th, 2009 at 12:27 pm
Yeah I’m not sure how 52 million people without insurance by 2019 can be called reform.
Pretty much what the GOP bill does is absolutely guarantee we will be back 5 years from now doing health care reform again.
What, no mention of the Storming of The Hill! Matt?
November 5th, 2009 at 12:40 pm
The magic of the free market will make the country healthier by making it too expensive to be sick. Don’t liberals know anything about economics? [/sarcasm]
November 5th, 2009 at 1:06 pm
You could have saved yourself some words here by reducing your remarks to: “Nuh uh!” Because, really, who needs actual data with retorts like that?
November 5th, 2009 at 1:31 pm
[...] Matthew Yglesias points out that the CBO found these cost savings to be very meager (”the amendment would lower average insurance premiums in 2016 by zero to 3 percent”) and that the savings would be achieved by making coverage worse (emphasis his): The second source of change in average insurance premiums is changes in the average extent of coverage purchased. Those changes can reflect both changes in the scope of insurance coverage—the benefits or services that are included—and changes in the share of costs for covered services paid by the insurer—known as the “actuarial value.” With other factors held equal, insurance policies that cover more benefits or services or have smaller copayments or deductibles have higher premiums, while policies that cover fewer benefits or services or have larger copayments or deductibles have lower premiums. Provisions in the amendment that would reduce insurance premiums by affecting the amount of coverage purchased include the State Innovations program, which would encourage states to reduce the number and extent of benefit mandates that they impose, and provisions that would allow individuals or affiliated groups to purchase insurance policies in other states that have less stringent mandates. [...]
November 5th, 2009 at 6:29 pm
Re: To repeat myself from yesterday, this is basically a plan that works well for you if you never get sick.
No, not even for those people: they still end up paying big bucks for crappy coverage. This plan only works well for people who own stock in insurance companies, or are on their executive boards.