The Congressional Budget Office’s estimate of the impacts of the American Health Care Act was a disaster for the bill and its Republican backers. The budget office found that the AHCA, if enacted, would result in massive coverage losses over the next decade, with some 24 million people losing their health insurance. That news has left conservatives and Republicans reeling and flailing as they try to figure out how to contain the political damage.
The Trump administration, which has been actively promoting the AHCA as a “replacement” for Obamacare, reacted harshly to the budget office's estimate, insisting that it was incorrect, illogical and untrustworthy. Newsmax CEO Christopher Ruddy, a friend of President Donald Trump and an ally of the administration, seized on the Congressional Budget Office report to push the White House to abandon the AHCA altogether and pursue a different course.
One AHCA backer, however, insisted that the report was actually quite good — not just good, in fact, but flat-out terrific. House Speaker Paul Ryan, who has more riding on the success of the AHCA than anyone else, went on Fox News on Monday evening to lavish the Congressional Budget Office with effusive praise. “I’m pretty encouraged by it,” Ryan said of the report, “and it actually exceeded my expectations.” Ryan wasn’t bothered by the explosion of uninsured people forecasted by the budget office, saying the “government’s not going to force people to buy something that they don’t want to buy.”
On Twitter, the speaker was no less ebullient, arguing that the budget office “confirms” that the AHCA “will lower premiums” and “improve access to quality, affordable care.” Ryan's office put out a nifty little infographic boasting that, according to the Congressional Budget Office, the AHCA will lower premiums 10 percent, reduce the federal deficit and cut taxes by $880 billion.
Wow! Sounds great! When you actually read the report and process what the budget office found, however, it becomes clear that Ryan’s celebratory jig is, in fact, some enthusiastic and elaborate turd polishing.
Let’s start with the premium reductions. The first thing to point out is that premiums would still rise under the AHCA, according to the budget office report. They would just climb 10 percent less, on average, than they would under the current law. So the top-line data point that the speaker cherry-picked from this analysis of his Obamacare “replacement” is that the growth in health insurance premiums over the next decade would be arrested a tiny bit.
Now let’s talk about why those premiums would be slightly lower. Ryan would have us believe that it’s because his bill would unleash the awesome magic of the free market. The real reason, however, is that the AHCA would make coverage so expensive for old, low-income people that they would be priced out of the market altogether. Per the Congressional Budget Office, a 64-year-old person making $26,500 a year would, under the AHCA, be on the hook for $14,600 in annual premiums. As budget office noted, these older people would simply go uninsured rather than spend 55 percent of their income on insurance premiums. That exodus of older people would result in an individual insurance market with a relatively higher concentration of healthy, younger people.
So when Ryan says the budget office “confirms” that care will be more accessible and affordable under his bill, he’s lying: The bill would make it impossible for people who need the most help to be covered.
That brings us to Ryan’s celebration of the AHCA’s effects on the deficit and taxes. The bill would cut taxes — for rich people, almost exclusively. At the same time, it would lower the deficit. How is this possible? Well, the answer lies in the fact that the AHCA would all but obliterate Medicaid.
The AHCA would halt the Affordable Care Act’s expansion of Medicaid and radically change the way the social insurance program is funded. Those two policy changes would translate into a staggering $880 billion in Medicaid cuts over the next 10 years. That’s ruinous, and the budget office noted that “reductions in insurance coverage between 2018 and 2026 would stem in large part from changes in Medicaid enrollment.”
The nonsense emerging from Ryan’s spin machine is designed to obscure the fact that the budget office report laid out in stark detail the absurd cruelty of the American Health Care Act: It would amount to a massive tax cut for the rich, paid for by goring Medicaid and forcing older, low-income people to go without health coverage. It’s completely unjustifiable as policy and politically toxic but fits nicely into the broader Paul Ryan agenda of taking money from low-income people and making their lives worse, so that the rich can have their taxes trimmed.