In its first analysis of the healthcare law since the Supreme Court's decision in June, the nonpartisan Congressional Budget Office finds that the court's ruling will make the Affordable Care Act more affordable.
On Tuesday, the CBO and the staff of the Joint Committee on Taxation (JCT) released two analyses relating to the ACA: one updating the CBO's budgetary estimates on the effects of the health insurance coverage provisions of the ACA following the SCOTUS decision and the other estimating the effects of a repeal of the law as laid out in H.R. 6079, the Repeal the Obamacare Act, passed by the House of Representatives on July 11.
[See also: Changes to healthcare entitlement programs needed for a sounder fiscal future; CBO budget report shows impact of healthcare costs and aging population.]
The Supreme Court's ruling that states are not required to expand their Medicaid programs has the effect of saving the federal government $84 billion, the CBO estimates. The CBO's estimation reflects the agency's recognition that some states will elect not to expand their Medicaid programs, resulting in an overall lower Medicaid enrollment.
"In this update of figures published in March 2012, CBO and JCT now estimate that fewer people will be covered by the Medicaid program, more people will obtain health insurance through the newly established exchanges and more people will be uninsured. The magnitude of those changes varies from year to year," the CBO wrote in its analysis. The agency expects Medicaid and the Children's Health Insurance Program (CHIP) to cover 6 million fewer people than previously estimated, with about 3 million more people enrolled in the exchanges and 3 million more uninsured. The reductions in spending from the lower Medicaid enrollment are expected to more than offset any increase in costs from having more people enroll in the exchanges, the CBO noted.
In a letter to House Speaker John Boehner (R-Ohio), Douglas Elmendorf, the CBO director, said the agency's analysis of the Repeal the Obamacare Act would add $109 billion to federal budget deficits over the 2013-2022 period. A repeal, the CBO estimated, would reduce direct spending by $890 billion and reduce revenues by $1 trillion in the years 2013-2022 and would leave about 60 million nonelderly people uninsured.
Elmendorf also noted that even if the ACA were to be repealed, the CBO expects that at least some of the changes brought about by the healthcare law that have already been implemented would continue.