On Monday, the Congressional Budget Office released a score that says the Senate Republican healthcare bill spends more and taxes more than the House bill, and yet barely makes any dent in the number of individuals who would be uninsured.
After House Republicans passed a healthcare bill, the big debate in Washington was how Senate negotiators would address the concerns of centrists that the House bill was too harsh, while appealing to conservatives who argued that the bill preserved too much of Obamacare. The CBO score is likely to raise concerns among both groups.
Specifically, the Senate bill would spend $89 billion more than the House bill and keep an additional $291 billion of Obamacare's taxes on the books. It would throw $107 billion to states and insurers in an attempt to stabalize insurance markets. Despite this spending, the CBO says the bill would leave 22 million more people uninsured than would be the case if Obamacare remained the law of the land, or just one million fewer people than under the House bill. The CBO also said that premiums would increase by 20 percent in 2018 and 10 percent in 2019 before going down thereafter as loosening of regulations allows people to purchase cheaper and less comprehensive health plans.
Now, there are a number of Republicans who are taking issue with the CBO scoring methodology, particularly the fact that it attributes so much power to the individual mandate. For instance, according to the CBO, by 2018, 15 million million fewer people will be covered "primarily" because Republicans will be not be imposing tax penalties on individuals who fail to purchase insurance. Republicans would instead would impose a six month waiting period on those who don't maintain continuous coverage. Why does the CBO remain so convinced that the mandate is so powerful despite evidence to the contrary?
Yet regardless, Republicans have already put effort into winning over the CBO. So it's worth noting that the Senate bill would spend roughly $1 trillion of Obamacare money, leave the law's regulatory infrastructure mostly intact, and slow-walk the rollback of Obamacare's Medicaid expansion, and with all of those nods, they still wind up with a CBO score that makes them vulnerable to Democratic attacks. Interestingly, much of the increased spending in the Senate bill (or $72 billion of it) comes from Medicaid, because as part of an attempted compromise, Republicans frontloaded spending on the program and delayed the real savings until 2025, when the program's growth rate is set to a lower rate of inflation.
In the coming days, as Senate Majority Leader Mitch McConnell, R-Ky., works to secure the 50 votes needed to pass legislation, there are a few things to keep in mind in terms of both centrists and conservatives.
For centrists, one number from the CBO score worth paying attention to is: $321 billion. That's the amount that the CBO says the current bill would reduce deficits by. That means McConnell has some money to work with and we should expect him to throw some around to help assauge the concerns of centrists, which is how the House bill eventually got over the finish line.
For conservatives already disappointed with the House bill, the CBO score further affirms their fears about the Senate bill, particularly that it doesn't do much to decrease premiums. The biggest selling point for conservatives is the bill's promise to slow the long-term growth rate of Medicaid, so they are going to have to ask themselves whether it's worth swallowing lots of spending in the short-run in the hopes that the Medicaid reforms would survive a number of Congressional elections and several more presidential terms. If that doesn't work, McConnell may be forced to make a technical argument -- which is that though the Senate taxes and spends more than the House, it still reduces spending by over $1 trillion and taxes by $700 billion -- and if signed into law, those become part of the new baseline. So not only does that mean, in the near term, that there will be a lower revenue baseline for tax reform, but it also means that the next time Democrats want to do something about healthcare, they'll have to come up with another $1 trillion.
But such technical arguments are a far cry from bygone claims of repealing and replacing Obamacare to lower premiums.