CBO: Healthcare reform to cost less but cover fewer

May 10, 2012

Expanding healthcare coverage under the Affordable Care Act will cost less than originally estimated, but will help fewer people, a new study shows.

Expanding healthcare coverage under the Patient Protection and Affordable Care Act will cost less than originally estimated but will cover fewer people, according to an updated analysis prepared by the nonpartisan Congressional Budget Office (CBO).

The CBO lowered the estimated costs of wider coverage for the years 2012 to 2021 from $1.131 trillion to $1.083 trillion. The cost reduction is the result of lower estimates for subsidies and tax credits related to planned insurance exchanges for individual coverage, but it also predicts higher revenues from penalties and income taxes as employers drop health insurance plans and pay employees more so they can buy private insurance through health insurance exchanges.

The analysis also predicts, however, that 4 million fewer people than originally estimated will get insurance through employers or insurance exchanges. Many of those will have to obtain coverage through Medicaid, the CBO says.

x