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A new report from the Congressional Budget Office dealt what should be a crushing blow to the tax bill: The deal that was crafted to win key senators who objected to the bill’s provision that would leave millions uninsured won’t actually stanch the loss in coverage.
Still, this report probably won’t change much.
With moderates expressing concern over a provision that would repeal Obamacare’s individual mandate — leaving an estimated 13 million more uninsured by 2027 — Republican leadership hatched a plan to simultaneously pass a bill to stabilize the Obamacare marketplaces, a proposal negotiated by Sens. Lamar Alexander (R-TN) and Patty Murray (D-WA).
But this proposal hit a major snag Wednesday when a new CBO report found passing the Alexander-Murray proposal — the centerpiece of which is funding Obamacare’s cost-sharing reduction subsidies that Trump has threatened to pull — would not in fact help mitigate the coverage losses and premium hikes triggered by repealing the individual mandate.
Previous estimates from the CBO found that repealing the individual mandate, the Obamacare policy that penalizes people who opt out of buying health insurance, would leave 13 million fewer insured by 2027 and increase premiums by an average of 10 percent over the next decade.
“If legislation were enacted that incorporated both the provisions of the Bipartisan Health Care Stabilization Act and a repeal of the individual mandate ... the effects on the premiums and the number of people with health insurance coverage would be similar,” Keith Hall, the CBO’s director, wrote in a letter to Murray.
This will prove to be a major test for senators like Lisa Murkowski (R-AK) and Susan Collins (R-ME), who have previously expressed concern about repealing the individual mandate but signaled that the addition of Obamacare stabilization packages could be enough to win their votes.
On Tuesday, Collins told reporters that she would like to see more than just the Alexander-Murray proposal passed to support repealing the individual mandate. She has another bipartisan proposal with Sen. Bill Nelson (D-FL) that gives $4.5 billion in federal funding to health insurers to offset any premium increases after repealing the individual mandate.
The president and Republican leadership have shown interest in passing both those proposals to win her vote on tax reform.
Go deeper:
- Vox’s Dylan Scott explains why the Alexander-Murray stabilization deal addresses an entirely different set of concerns than the individual mandate.
- Republicans want to repeal the individual mandate to make the math work in their tax reform proposal. Here’s why.
