The Final State of the Union
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Summary:
The new year starts with a renewed focus on the Affordable Care Act (ACA), which the President signed into law last year and has already delivered a host of consumer protections and benefits to millions of Americans.
The new year starts with a renewed focus on the Affordable Care Act (ACA), which the President signed into law last year and has already delivered a host of consumer protections and benefits to millions of Americans.
Yesterday, the House Republican leadership introduced a bill to repeal the ACA. Today, the Congressional Budget Office (CBO) sent a letter to the Speaker of the House giving its assessment of the budgetary effects of a repeal: it would increase the budget deficit by hundreds of billions of dollars over the next decade. The CBO letter notes that “over the 2012–2021 period, the effect of H.R. 2 [the repeal of ACA] on federal deficits … is likely to be an increase in the vicinity of $230 billion.” This result is not surprising since CBO scored the ACA as reducing the deficit by more than $100 billion through 2019 and by more than $1 trillion in the decade after that.
To be fair, CBO is clear that this is a preliminary estimate that does not take into account a host of changes in the economy, technical matters, and the effects of the implementation to date. But even after a more comprehensive analysis, we should expect the same outcome: the deficit would increase substantially if ACA were repealed. As CBO Director Elmendorf wrote in his blog today, “those developments will probably not have a major effect on the overall budgetary impact of repealing the legislation.”
For those in both parties who care about the deficit and our future fiscal course, the repeal of the ACA should concern them deeply. Rising health care costs are the biggest driver of our long-term deficits, and getting them under control is crucial for the fiscal health of the nation and to keep our economy growing, creating jobs, and competing in the world economy. Beyond that, we need to keep in mind that repealing the ACA also would roll back what the bill already has done to help millions of Americans -- from the families benefitting from the end to lifetime dollar limits on essential benefits to the young people now able to join their parents’ policies and the seniors who now are able to afford their prescription drugs. And repeal would deny an estimated 32 million American citizens health insurance in years to come.
Jack Lew is the Director of the Office of Management and Budget
