A new report from the Congressional Budget Office (CBO) says repealing the Affordable Care Act (ACA) would increase the budget deficit by $353 billion over the next decade and eliminate health coverage for 19 million people in 2016 and 24 million more from 2016 to 2025.
The new deficit estimate from the non-partisan CBO and the Joint Committee on Taxation is a dramatic increase over the 2012 report, which forecast a $109 billion deficit if the ACA was abolished.
For the first time, the CBO used a calculation method that factors in the effects of repeal on the overall economy, as favored by Congressional Republicans. Under that technique, and assuming slightly higher national unemployment, the federal deficit increases by $137 billion (instead of $353 billion).
The CBO report came just days before the U.S. Supreme Court ruling in King v. Burwell, the challenge to the advanced premium tax credit offered under the Affordable Care Act (ACA). Justices ruled last week that the ACA does not bar financial assistance to low- and moderate-income residents of states that rely on the federal health insurance marketplace, healthcare.gov, rather than a state-run health exchange.
Republicans have been pushing for repeal of the ACA almost since it was signed into law by President Obama in 2010. The latest Centers for Disease Control and Prevention’s National Health Interview Survey says about 36 million people, 11.5 percent of the entire population, were uninsured in the U.S. last year. That number was down 4.5 percent since 2010.
“Implementing a repeal of the ACA would present major challenges,” the CBO report said. “In the five years since the enactment, nearly every key provision of the law has taken effect and has been incorporated into the final rules and other administrative actions. Undoing the ACA would thus be quite complicated.”
The CBO says repeal of the health care law would initially reduce federal deficits, but then cause them to increase steadily beginning in 2021. The initial savings would result from a reduction in government spending on subsidies and the nation’s expanded Medicaid program. However, an ACA repeal would eliminate cuts in Medicare payment rates to hospitals and other providers as well as new taxes on medical device makers and pharmaceutical firms. While repeal is being advocated by many in the GOP, a presidential veto is all but assured if the proposal makes its way to the White House.