In CBO’s assessment, Medicaid spending under the Better Care Reconciliation Act of 2017 would be 26 percent lower in 2026 than it would be under the agency’s extended baseline, and the gap would widen to about 35 percent in 2036 (see figure below). Under CBO’s extended baseline, overall Medicaid spending would grow 5.1 percent per year during the next two decades, in part because prices for medical services would increase. Under this legislation, such spending would increase at a rate of 1.9 percent per year through 2026 and about 3.5 percent per year in the decade after that.
CBO and the staff of the Joint Committee on Taxation do not have an insurance coverage baseline beyond the coming decade and therefore are not able to quantify the legislation’s effect on insurance coverage over the longer term. However, the agencies expect that after 2026, enrollment in Medicaid would continue to fall relative to what would happen under the extended baseline.
On the basis of consultation with the budget committees, CBO’s just-released cost estimate for the bill measured the costs and savings relative to CBO’s March 2016 baseline projections, with adjustments for legislation that was enacted after that baseline was produced. For consistency, this longer-term analysis uses CBO’s extended baseline published in July 2016. CBO analyzed these longer-term effects at the request of the Ranking Members of the Senate Budget Committee and the Senate Finance Committee.
—byy Ann Crawford-Roberts, Nichole Roxas, Ichiro Kawachi, Sam Berger, and Emily Gee
One Republican member of Congress, defending the GOP health care plan—the American Health Care Act (AHCA)—suggested that concerns that the loss of health care coverage leads to death are overblown. However, the scientific literature on the effects of insurance coverage on mortality shows that the coverage losses from the AHCA would result in tens of thousands of deaths.
The secret Senate bill was finally released today, and it is broadly similar to what passed in the House: It ends Medicaid expansion and makes further deep cuts to the program; eliminates the individual mandate; and reduces funding that helps low-income Americans afford health coverage. The Congressional Budget Office (CBO) has not yet released its score of the Senate bill, although it is expected to do so early next week.
The CBO, however, has released a score of the House’s version of the AHCA, which is largely similar to the Senate bill. The score projected that, by 2026, 23 million more Americans would be uninsured under the House bill compared to the Affordable Care Act (ACA). Using estimates of mortality rates from Massachusetts’ experience with health reform, we estimate the number of additional deaths resulting from coverage losses from the Senate bill under three scenarios: one scenario in which coverage losses from the Senate bill are the same as under the House version, and two scenarios in which those coverage losses are modestly reduced by changes from the House bill.
Assuming that 15 million fewer people would have coverage in 2026, we estimate that the coverage losses from the Senate bill would result in 18,100 additional deaths in 2026.
Assuming that 19 million fewer people would have coverage, we estimate that the coverage losses from the Senate bill would result in 22,900 additional deaths in 2026.
Assuming that 23 million fewer people would have coverage, we estimate that the coverage losses from the Senate bill would result in 27,700 additional deaths in 2026. If coverage losses from the Senate bill matched those from the House bill, it would result in 217,000 additional deaths over the next decade.
Allocating these coverage losses among the states, this analysis also presents estimates of additional deaths by state.
Health insurance is associated with improved health and reduced mortality
A significant body of research has demonstrated the health benefits associated with health insurance expansion, including reducing the rate of death among the population. One study found that state Medicaid expansions that preceded the ACA were associated with a significant reduction in mortality. A recent analysis of these pre-ACA Medicaid expansions demonstrated a 6 percent decline in all-cause mortality due to Medicaid expansion. Another analysis showed that following implementation of the ACA’s provision that allows young adults to remain on a parent’s health insurance until age 26, mortality rates decreased among Americans ages 19 to 25. In particular, mortality caused by diseases amenable to health care dropped among young adults, while trauma-related mortality did not. And a study of patients with cancer between the ages of 20 to 40 found a statistically significant association between insurance coverage and reduced mortality from any cause.
The result most relevant to the ACA and its repeal comes from a study examining the effects of the Massachusetts health care reform on all-cause mortality and on mortality due to causes amenable to health care. The study found that expanding insurance coverage was associated with a 2.9 percent decrease in all-cause mortality and a 4.5 percent reduction in deaths from causes amenable to health care. Because Massachusetts’s reform was used as the model for the ACA and included a coverage mandate, Medicaid expansion, and private insurance expansion through the individual market, the data is more representative of the effects of ACA insurance gains than studies looking solely at Medicaid expansion or narrow demographic groups. Furthermore, observers have noted that the study’s quasi-experimental study design is of high quality and the “next best thing” to a randomized control study.
Other parts of the scientific literature have shown how having health insurance, unsurprisingly, results in better health. A recent study of three years of ACA data demonstrated that uninsured people who gained coverage through the ACA experienced a 23 percent increase in self-reported “excellent” health. One analysis found that the ACA coverage expansion was associated with reductions in self-reported “fair” or “poor” health and days with activity limitations due to ill health. Another analysis showed that ACA insurance gains were associated with an increased share of respondents reporting excellent health. And a recent study of ACA-facilitated Medicaid expansions found that they modestly improved self-reported health.
Other insurance expansions produced similar results. Massachusetts’ insurance expansion was associated with improvements in self-reported general, physical, and mental health. Data from the Oregon Health Insurance Experiment showed that expanding Medicaid was associated with improved self-reported physical and mental health and reduced depression.
Insurance coverage also improves children’s health and access to care. Research shows that when parents have insurance coverage, their children are more likely to be covered, maintain stable coverage, and receive needed care. According to the Institute of Medicine’s systematic review, insured children are more likely to gain access to well-child care and immunizations, appropriate care for asthma, and basic dental services, as well as have fewer avoidable hospitalizations, improved asthma outcomes, and fewer missed days of school.
Taken as a whole, the research strongly suggests that health coverage has a significant positive effect on health. However, a few studies have found more limited health impacts of insurance expansion. While the Oregon study found improvements in self-reported health, it did not detect clinical improvements other than depression reduction. Another study showed no changes in self-reported health resulting from the ACA, although a subgroup analysis did show improved self-assessed health among older nonelderly adults, especially in expansion states. And an early observational study of the ACA’s Medicaid expansion comparing low-income adults in expansion and nonexpansion states found no differences in self-reported health between the groups.
There may be several reasons for these outlier results. The studies in question looked at time frames too short or sample sizes too small to capture more significant health impacts. In addition, insurance is a necessary but not sufficient factor to receive quality health care. Receiving high-quality health care requires access to providers, institutions, and services; access to consistent primary care and referral services; choice of providers and institutions; and the delivery of high-quality services. It also requires that insurance policies cover basic and vital services.
The effects of the repeal bill on mortality
Drawing on the Massachusetts experience, we estimate that there would be one excess death for every 830 people who lose coverage as a result of the AHCA. The CBO projections of coverage reductions under the House version of the AHCA would equate to 217,000 additional deaths over the next decade, including 27,700 additional deaths in 2026. (see Table 1) To put this in perspective, that is approximately the number of people in the United States who died from opioid overdoses in 2014 and about twice the number of deaths by that same year.
We also estimate the additional deaths in 2026 resulting from coverage losses from the Senate bill under three scenarios: one assuming coverage losses equivalent to the House bill and two scenarios that show modest reductions in coverage losses. If the Senate bill results in coverage losses of 19 million that would result in 22,900 additional deaths in 2026. If the Senate bill results in coverage losses of 15 million that would result in 18,100 additional deaths in 2026.
In addition, drawing on the Center for American Progress’ estimate of state-level coverage reductions in 2026 under the House version of the AHCA, we estimate additional deaths by state in 2026 as a result of coverage losses from the Senate bill under the three scenarios. Under the scenario assuming coverage losses of 23 million, annual additional deaths would range from 36 in North Dakota to 3,111 in California in 2026. Under the scenario assuming coverage losses of 19 million, annual additional deaths in 2026 would range from 30 in North Dakota to 2,570 in California. Finally, under the scenario assuming coverage losses of 15 million, annual additional deaths in 2026 would range from 24 in North Dakota to 2,029 in California.
Given the overwhelming weight of evidence, there should be no debate: Health care coverage has an impact on whether Americans live or die. Our data estimates show that under any of the scenarios we analyzed, a significant number of American lives are at stake in this debate. Legislators considering whether to support this bill should keep in mind and soberly consider the catastrophic effect the AHCA would have on so many Americans and their families.
We calculated national excess deaths per year by dividing the estimated coverage losses by the estimated numbers needed to treat (NNT) to prevent one death, based on analyses of the Massachusetts health care reform. “Treatment” in this instance refers to the number of individuals who would need to receive insurance coverage in order to prevent one extra death. The Massachusetts study found that there was one fewer death for every 830 people who gained coverage; that NNT was consistent with a 30 percent relative reduction in individual-level mortality for persons gaining insurance.
We estimate that there would be one excess death for every 830 people who lose insurance coverage, which assumes that the Massachusetts result would be symmetric for health insurance gains and losses. Of note, our approach is similar to that taken by the White House Council of Economic Advisers to calculate the mortality reductions from the ACA.
Our estimate of the national number of excess deaths each year under the AHCA is then equal to the CBO-projected coverage reduction under the House bill divided by 830. We calculated state level estimates by applying the same methodology to state-level health insurance losses from the Center for American Progress’ state-level analysis, which combines data from the CBO, the Kaiser Family Foundation, the Centers for Medicare and Medicaid Services, and the American Community Survey to calculate anticipated insurance losses by coverage type.
We also included estimates of the number of excess deaths in 2026 if national coverage losses under the Senate bill were 15 million or 19 million that year. For our state-level estimates, we assume that each state’s coverage reductions and excess deaths are 65 percent and 83 percent of our estimates of the effects under the House-passed bill, respectively.
Recent debate sheds light on different approaches to estimate the mortality impacts of insurance loss. Bearing this debate in mind, we designed our approach using the most accurate, rigorous studies. We base our calculations on estimates of AHCA-related coverage losses from the CBO and the Center for American Progress, and on Benjamin D. Sommers, Sharon K. Long, and Katherine Baicker’s 2014 quasi-experimental study of the effects of Massachusetts Health Care Reform on mortality. We chose this study due to its sample size and power, and because Massachusetts’ health reform, which expanded both private and public coverage, was used as the model for the ACA.
One limitation of our analysis is that the same NNT was applied to all states, although the estimate was derived from the Massachusetts’ health care reform. There are demographic and health care infrastructure differences between Massachusetts and other states. The Massachusetts population has a higher per capita physician rate, lower baseline mortality rate, higher income and baseline insurance coverage rates, fewer racial and ethnic minorities, and more women, compared to national averages. Some of these factors suggest that Massachusetts may have a higher NNT than other states, meaning that our estimate of the number of excess deaths under the AHCA would be too low, while other factors suggest the state may have a lower NNT.
In addition, the NNT was calculated from mortality decreases associated with insurance expansion. There is uncertainty as to whether withdrawing insurance will cause the equal and opposite effect of providing insurance. Lastly, our estimates capture only the impact of increased uninsurance under the AHCA and do not take in to account possible mortality effects among people who would remain insured but lose certain benefits or encounter worse access to care due to the bill.
We calculated a 95 percent confidence interval around our estimates of excess mortality. The confidence interval contains the range of reasonable values that include our estimate of excess mortality, with 95 percent confidence. Within this range the best estimate for the actual number of excess deaths is the point estimate. The point estimate is the mean and represents our best prediction for annual excess mortality rates, given the current evidence and available data. For instance, in the year 2026 and assuming 23 million more people are uninsured, we estimate that 27,711 excess deaths will occur, and we are 95 percent confident that the true number of annual excess deaths will be between 9,583 and 46,000.
Ann Crawford-Roberts is a medical student at the Icahn School of Medicine at Mount Sinai and a graduate of the Harvard T.H. Chan School of Public Health. Nichole Roxas is a medical student at the University of Rochester School of Medicine and Dentistry and a graduate of the Harvard T.H. Chan School of Public Health. Ichiro Kawachi is a professor of social epidemiology and the chair of the Department of Social and Behavioral Sciences at Harvard T.H. Chan School of Public Health. Sam Berger is the senior policy adviser at the Center for American Progress. Emily Gee is the health economist for the Health Policy team at the Center.
The “American Health Care Act (AHCA)” is now being negotiated amongst only Senate Republicans in some back room. When it comes out, no amendments will be allowed. Will Senator Dean Heller (R-NV) vote for its passage? What will it cost you?
Press Secretary Sean Pricer made a big deal about the size of the American Health Care Act (AHCA) in comparison to the Patient Protection and Affordable Act (PPACA) which is also called the ACA or by its GOP nickname, “Obamacare.” But he asked people to do was to compare apples to asparagus. One is an actual healthcare bill, the other is “reconciliation” bill, a gimmick that the Republicans are using to remove revenue and expenses from the original legislation (the one on the right).
So what is “reconciliation”?
Reconciliation is a legislative process of the US Senate which allows consideration of a “budget bill.” The process limits debate to 20 hours and eliminates any opportunity to filibuster the bill. Reconciliation also exists in the US House, but because the House regularly passes rules that constrain debate and amendments, the process has had a less significant impact.
A reconciliation budget resolution directing one or more committees to submit legislation changing existing law in order stated spending and revenue requirements. But most notably, the reconciliation process can only be used to change laws that are scored by the Congressional Budget Office, in other words, those that cost money or are implemented as taxes. And, if you’ll remember, the Supreme Court, on June 28, 2012, ruled that ObamaCare a “tax” and not a mandate, and therefore declared it “constitutional.”
Since the ACA is a “tax” … and since the Republicans control both houses of Congress and the Presidency, they’ve decided to go after the tax and revenue side of ACA using a gimmick that allows them to repeal all of the “money” side of the bill using a simple majority vote and then fight to kill all the provisions that really help Americans using regular legislative bills (hence, their discussions of steps 1, 2, and 3).
The analysis is a bit light on what might happen regarding employer-based healthcare benefits. Because the bill would use “age-rating” to set premium costs and allow insurance companies to charge 5-times as much for premiums for older workers as for younger workers, that’s going to make a huge difference to employers as employees age.
Will employers begin dropping healthcare benefits en masse?
Will employers use this as yet another excuse to gouge employees by either ending healthcare benefits without raising their wages/salaries or employing their own age rated cost-sharing schemes?
Will workplace environments become hostile for aging workers as they attempt to force out older “expensive” workers in favor of younger “cheaper” new hires?
Will employers use this as an excuse to drop all healthcare benefits for retirees or price the premium cost-sharing out of their reach?
How badly will Rural Hospitals be affected by the capping/cutting of not just Medicaid funding, but the repeal of all funding supporting Rural Hospitals in general? We’ve already seen on rural hospital in Tonopah, NV close its doors. How many more will follow in their footsteps?
Here’s what we do know:
Because this is a ‘reconciliation’ bill, it does nothing to change provisions that have no tax revenue/expense basis. For example, insurance companies would still be required to provide coverage to any applicant, would not be able to vary premiums to reflect enrollees’ health status or to limit coverage of preexisting medical conditions, and would be limited in how premiums could vary by age. Prohibitions on annual and lifetime maximum benefits would still apply. In addition, insurers would also still be required to cover specified categories of health care services, and the amount of costs for covered services that enrollees have to pay out of pocket would remain limited to a specified threshold.
Healthcare provider organizations and the medical community as a whole, AARP, American Medical Assoc, American Nurses Assoc, American Hospital Assoc, and National Physicians Alliance have all come out against passage of the AHCA. On the other hand, a number a “conservative groups” have expressed support: National Taxpayers Union, Americans for Tax Reform, Center for the American Experiment, Citizens Against Government Waste, Independent Women’s Voice, Institute for Liberty, Log Cabin Republicans, Market Institute, and the Small Business & Entrepreneurship Council, none of which provide an ounce of healthcare to anyone.
We know that a large number of rural communities across this nation have just one insurance provider serving their community. Speaker Ryan has proclaimed this bill will miraculously increase competition throughout the nation. However, there is absolutely nothing in the reconciliation bill to incentivize corporations to actually do business in Rural America, where they have not created healthcare networks and left millions of Americans will few if any choices for coverage. The GOP have touted the AHCA has just step #1 in a three step process, but there is absolutely nothing but air with respect to steps #2 and #3, and how those steps would improve or denegrate healthcare choices for coverage even further.
Premium costs will still RISE, however, the analysis indicates the ‘average’ premium cost will be 10% less than what the increase would have been under the ACA, once the older, sicker population has been priced out of the market.
Medicaid will see some major cuts ( reduction of $880 billion in federal outlays ) and turned into block grants to the states for them to administer. Specifically, beginning in 2020, the federal government would establish a limit on the amount of reimbursement it provides to states. That limit would be set by calculating the average per-enrollee cost of medical services for most enrollees who received full Medicaid benefits in 2016 for each state. Given that capping of benefits to the states, we can anticipate those cuts will lead to some serious healthcare rationing, and potentially, “death panels” in various states as those who are sick, but who can’t pay for the care they need, turn to their State’s Medicare program which has insufficient funding to meet demand.
Because the reconciliation bill changes the means by which premium rates are structured, premiums for older people can be charged at 5X the rate of premiums charged to younger people. Faced with the choice between giving their money to insurance companies who need return even less than 60% of their premium payments in the form of actual healthcare reimbursements, lower income older Americans will find themselves driven out of the market altogether when they can no longer pay the rent, put food on the table, pay for utilities, pay for a car and fuel to be able to get to work, AND let the healthcare insurance company suck the life out of them.
Monies withdrawn from support of the Medicaid program, instead of being applied toward reducing our Nation’s national debt will instead be used to laud massive tax breaks for the upper 2% of the population. In addition, it repeals other provisions that impacted the wealthy: a. Repealing the surtax on certain high-income taxpayers’ net investment income; b. Repealing the increase in the Hospital Insurance payroll tax rate for certain high-income taxpayers; c. Repealing the “cadillac” tax on some health insurance benefits plans
The bill creates a new mandate, this time for insurers, requiring them to levy a 30% surcharge on premiums for people who enroll in insurance in the nongroup or small-group markets if they have been uninsured for more than 63 days within the past year.
The bill repeals the metal scale [bronze(60%), silver(70%), gold(80%) and platinum(90%)] for insurance policies and will allow insurers to once again provide plans having an actuarial value below 60%. The question then becomes ‘what’ does the GOP have planned for steps #2 and #3. Since the reconciliation bill is unable to repeal the requirements to cover 10 categories of health benefits that are defined as “essential” under current law, it would be challenging for insurers to drop actuarial values for what they cover below 60%. Thus, what are their Step#2 and #3 plans to stiff Americans?
Buyer BEWARE! The onus will be shifted to individuals whoare shopping for insurance to pay attention to the details and not look just at the price. Plans would be harder to compare, making shopping for a plan on the basis of price alone, much more difficult. In addition, with more plans that are eligible for subsidies offered directly from insurers or directly through agents and brokers and not through the marketplaces’ central websites, shopping for and comparing plans could once again become much harder, depending on insurers’ decisions about ‘how’ they choose to market their plans.
Currently, premium tax credits vary based on geography (how much services cost in the buyers region) and age for a given income level. Beginning in 2020, under the legislation, the size of a premium tax credit would vary merely by age, and disregard income and geography. Such policy would force people to become “under-insured” and once again, potentially increase the volume of health-related bankruptcies, especially for people living in high-cost areas would be responsible for a larger share of the premium.
The GOP who continually rales that Congress should NOT be in the business of picking “Winners and Losers” just did exactly that using the reconciliation bill with which to do that. They declared Planned Parenthood and the women who seek healthcare at their clinics: “Losers.” Planned Parenthood will no longer be permitted to bill Medicaid for the healthcare services they provide to many any low income women across this nation who seek care at their clinics, unless of course, they bow down to Evangelical jihadist demands to never, ever, ever, ever again perform a single solitary abortion in any of their facilities. So much for separation of Church and State. “Planned Parenthood hits the GOP’s bullseye definition in the AHCA of a “nonprofit,” an “essential community provider … primarily engaged in providing family planning and reproductive health services and related medical care,” an abortion care provider, and the fiscal year 2014 recipient of more than $350 million in Medicaid funds that can’t be used for abortion care due to the discriminatory Hyde Amendment.” — Rewire
The CBO report anticipates that some employers would choose not to offer coverage and turf their employee base out into the individual market. It also optimistically anticipates those same employers would instead increase “other forms of compensation” in return. (I’m sorry, but I’m not so optimistic as to those alternative increases.) Additionally, the CBO anticipates the number of people no longer receiving employer-based healthcare will grow from 2 million fewer people in 2020, to 7 million fewer people.
Who loses if this bill should pass? Currently, around 9.5 percent of Americans younger than 65 are uninsured How does that change? Here’s the bottom line, the CBO report estimates that should this bill be enacted, 48 million people under age 65, or roughly 17 percent of the non-elderly population, would be uninsured in 2020. That figure would grow to 52 million, or roughly 19 percent of the non-elderly population, in 2026.
Those are just a few of the points I gleaned from reading the GOP’s American Health Care Act and the CBO Report. I encourage you to read them as well and then take action to make sure your members in Congress know where you stand.