By Sara Rosenbaum and Nikki Hurt
Since the 2010 enactment of the Affordable Care Act (ACA), the Congressional Budget Office (CBO) has issued a series of cost and coverage impact estimates. Evolving cost estimates are, of course, a reflection of changing economic and social conditions such as labor and employment patterns, the cost of goods and services in the economy generally and health care costs in particular, and choices by sponsors of public and private health insurance coverage, such as employers, government programs, about what and whom to cover or how much to pay for care. Impact estimates also reflect changes in law and public policy, such as the 2012 decision by the United States Supreme Court to bar the federal government from enforcing the Act’s Medicaid expansion for low income adults, thereby effectively turning the expansion into a state option.
In addition, the methods used to calculate impact have an important effect. In this vein, it is important to note that with each subsequent estimate, CBO alters its assumption methods as well as the baseline for its projections. For example, between the 2010 and 2011, the CBO cost estimate rose nearly 50%, a seemingly large jump given the relatively small increase in the number of individuals anticipated to gain coverage between the two estimate time frames. But of the 10-year timeframe covered in the 2010 CBO estimate, full implementation of the ACA accounts only for six of those years (2014-2019). The 2011 estimate, by contrast, includes projections from 2012-2021 time period, thereby adding two years of full implementation. The differences in the estimation timeframe, as well as the increased costs of the ACA post-implementation, account for some of the variation seen among the CBO estimates.
The table below summarizes these evolving CBO cost and impact estimates which consider the ACA through a rolling 10-year framework.
Below are links to the CBO estimates:
June 5, 2013
In May 2013, the Congressional Budget Office (CBO) issued its latest update of estimates of health insurance coverage and costs under the Affordable Care Act. This Implementation Brief summarizes the changes in CBO’s estimates over time, focusing on three key sets of estimates...
January 8, 2013
Both the Senate and the House passed H.R.8 (89-8 and 257-167, respectively), the American Taxpayer Relief Act, on January 1, 2013. President Barack Obama signed the Act into law on January 3, 2013. The measure extends Bush-era income and other tax cuts for individuals and families making up to $400,000 and $450,000 respectively. For individuals and families above this income threshold, the bill increases taxes from 35% to 39.6%. H.R. 8 also postpones...
August 1, 2012
The Congressional Budget Office (CBO), the legislative branch agency responsible for estimating the cost of legislation, issued two reports on July 24th related to the Affordable Care Act (ACA). The first report
, revised cost and health insurance coverage estimates for the ACA in the wake of the Supreme Court ruling in NFIB v. Sebelius
. In that ruling, the Court concluded the individual requirement to purchase health insurance coverage, while not a reasonable exercise of congressional Commerce Clause authority, is constitutional as a tax under congressional Spending Clause authority. The Court also held that the ACA’s Medicaid expansion, requiring states to cover all non-elderly individuals with incomes below 133
percent of the federal poverty level was unconstitutional. However, rather than striking the requirement, the Court precluded the Secretary of the Department of Health and Human Services (HHS) from enforcing the mandate by withholding all Medicaid funds. As a result of the ruling, states now have the option of expanding coverage to 133 percent of the federal poverty level (FPL), and will receive enhanced federal matching funds as provided under the law, but are not required to expand coverage.
May 21, 2012
The Affordable Care Act (ACA) established American Health Benefit Exchanges (the Exchange or Exchanges), a marketplace where consumers can choose a private health insurance plan to fit their health needs. The Exchanges will provide Americans with access to the same health insurance choices as members of Congress. Today, the Treasury Department issued final regulations implementing the premium tax credit that will give middle-class Americans unprecedented tax benefits to make the purchase of health insurance affordable.
Premium tax credits will, first and foremost, make...
August 12, 2011
The U.S. Department of Health and Human Services (HHS) and the Internal Revenue Service (IRS) have released Notices of Proposed Rulemaking (NPRM) on Exchange eligibility and insurance premium tax credits, respectively. Additionally, the Centers for Medicare and Medicaid Services (CMS) has released an NPRM related to the Medicaid eligibility expansion authorized by the Affordable Care Act (ACA).
All three NPRM
s are designed to simplify Exchange eligibility and enrollment by coordinating with state Medicaid agencies and the IRS to determine eligibility for premium tax credits and Medicaid under the new expanded eligibility rules laid out in the ACA. Also addressed in the proposed rules is the eligibility and calculation of tax credits for small businesses.
For more information on the Medicaid eligibility expansion, click here
. For more information on tax credits, click here
. For more information on Exchange eligibility, click here
. Finally, for more information on tax credits for small businesses, click here