Senate health care bill CBO score: Here's why your insurance costs could rise under the BCRA

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The Congressional Budget Office on Monday released its scoring of the Better Care Reconciliation Act of 2017, the Senate's version of a bill to repeal the Affordable Care Act. As expected, the CBO finds the bill would increase the number of uninsured — by 22 million people by the year 2026 — a figure that's only slightly lower than the projection for the earlier House version.

There's other tough news for consumers in the CBO report. In the short term, premiums — the annual cost you pay to have insurance coverage — will rise on average, while out-of-pocket costs could also go up over both the short and long terms for many Americans, the report found.

Compared with current law, average premiums for benchmark plans will be about 20% higher in 2018, the CBO report says, mostly due to the fact that healthy people will no longer be compelled to by health insurance by the individual mandate. By 2020, the CBO projects premiums will finally begin to fall by about 30% on average, mostly due to reduced coverage, and the ramping up of federal subsidies: Fewer sick people being covered tends to lower average costs for those who remain insured. (Other analyses actually show average premiums rising for many groups.)

Notably, the "share of services covered by insurance would be smaller" under the bill, the CBO found — suggesting that easier standards would allow insurers to cover fewer health conditions. Americans can expect skimpier plans with higher deductibles (the amount you spend before insurance kicks in) requiring that they pay more total money out of pocket for care.

And of particular concern for consumers is that lifetime coverage caps would now be allowed, something which could lead to "large increases in out-of-pocket spending," according to the CBO. In some cases, this can mean deciding between bankruptcy and death, as shown in a recent viral Twitter thread by a New Jersey mom — who would not have been able to afford the six-figure cost of care for her young son if it weren't for comprehensive insurance coverage.

The BCRA would even affect people outside of the ACA exchanges, notably workers with employer-sponsored health insurance: As Vox executive editor Matthew Yglesias pointed out on Twitter, as many as four million people could lose employer-sponsored insurance in 2018.

In 2018, the CBO estimated, as many as 15 million fewer people would have coverage overall, and depending on their age, income and location, some could stand to see their premium hikes go up substantially — including for young people, according to a Kaiser Family Foundation analysis of an earlier but similar version of the Senate bill.

Even healthy, younger people could see their costs go up. According to the Kaiser analysis, a 27-year-old living in New York and making $30,000 per year would see their premiums increase as much as $630 annually. And lower income people of all ages would disproportionately receive less coverage than under current law, as the New York Times' Margot Sanger-Katz tweeted.

Premium increases would hurt lower-income, older patients most, especially in rural areas, as Bloomberg's Steven Dennis noted on Twitter. The cost hikes could be steep: 60-year-olds making 350% of the poverty line in 2020 — about $42,000 for an individual in 2017 dollars — could lose as much as $22,000 annually in premium credits, according to the Center on Budget and Policy Priorities.

Why are some of these disparities so extreme? One of the major changes in the bill from the House version is that it bases the size of health care subsidies on age, as opposed to income and location. The bill also raises the amount more for health coverage that insurers can charge the elderly from three times to a factor of five.

Those who get insurance through smaller employers could see premiums go up, according to one industry source who spoke anonymously to Vox. That's a particular concern, because about nine in 10 U.S. businesses have fewer than 20 employees according to the Small Business Council.

"The likely effect would be really undermining the small group market reforms of the Affordable Care Act," said Tim Jost, a professor at the Washington and Lee University School of Law. "So an insurer that was marketing through an association plan could charge a lot more to an unhealthy group of five, than to a healthy group of five."

Very small businesses often team up to buy insurance through an association, and under the ACA, these plans all had to meet minimum coverage standards. The Senate bill does away with those minimum coverage standards, meaning a professional association would be free to use whatever plans they wanted, regardless of which state their employees work in.

Another problem for individuals is that some regions of the United States could potentially lose insurers in the exchanges altogether, as MSNBC's Christopher Hayes noted in a tweet, although CBO officials said in a conference call that changes to the waiver system should theoretically give states the flexibility they need to prevent that from happening.

One financial pressure on insurers is the loss of federal subsidies: As recently as May, insurers like Blue Cross Blue Shield pointed to the loss of this cost-cutting aid as a main reason they needed to raise premiums on ACA plans.

It's unclear whether the Senate bill will actually pass in its current form, especially in light of the new CBO score. Faced with uniform opposition from Senate Democrats, only three Senate Republicans need to defect in order to kill the bill.

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