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CBO: Bipartisan Alexander-Murray bill would slash deficit by $3.8 billion, leave insured number unchanged

Bill would have insurers paying $3.1 billion in rebates to government, consumers, report said.

Beth Jones Sanborn, Managing Editor

Sen. Patty MurraySen. Patty Murray

The bipartisan Alexander-Murray healthcare bill would cut the deficit by about $3.8 billion from 2018 to 2027 and would not substantially change the number of people with coverage, according to a Congressional Budget Office Report released Wednesday.

It would also not increase net direct spending or on-budget deficits in any of the four consecutive 10-year periods beginning in 2028, the report said.

The bill seeks to fund cost-sharing reduction payments for two years through 2019. The CBO said those payments were already part of their baseline, to the tune of $18 billion for 2018 and 2019 and $99 billion for the entire period of 2018 to 2027. Because of that, the CBO projected the payments would not affect direct spending or revenues.\

[Also: Healthcare groups urge Congress to support bipartisan bill]

As for premiums, the CBO based their report on the assumption would not be enacted until after open enrollment began on Nov. 1, so premiums for 2018 would not be affected, nor would health insurance coverage. The report also assumed that CSRs would be fully funded for 2019, and therefore projected that premiums would remain unchanged in 2019 as well. With uncertainty still for 2020, it's possible premiums will rise that year, the report said.

They also predicted that insurers would spend $3.1 billion in rebates to the federal government and/or individuals as result of hiking premiums for 2018. The legislation requires states to hand in plans that ensure they will be providing rebates to consumers and the federal government.

Another source of savings stems from the law's allowance of copper plans, low-cost health insurance plans that cover catastrophic health events. Those plans tend to attract younger healthier consumers, and while the report did not predict this would not notably change the number of insured, it did have the potential to lower premiums for other consumers. The shift is expected to yield $1.1 billion in savings in the 2019 to 2027 period, the report said.

"This nonpartisan analysis shows that our bill provides savings and ensures that funding two years of cost-sharing payments will benefit taxpayers and low-income Americans, not insurance companies," Sens. Alexander and Murray said in a joint statement.

The bipartisan bill does face opposition, with President Donald Trump having said he does not support a plan that offers insurers subsidies.

Twitter: @BethJSanborn
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