Week in Washington: CBO Releases New Scores

May 24, 2018

The Congressional Budget Office released its updated findings here:

A few Key Findings

  1. CBO expects the mandate to decrease ACA enrollment by about 3 million in 2019 and increase premiums 10% (same as previously). However, the long term effects are expected to be one-third lower than originally projected (8.7 million more uninsured than otherwise would have been)

  2. Overall CBO expects the benchmark premium to increase 15% in 2019 (generally they expect the benchmark premium to increase on average 10% each year for the next 5 years)

  3. Association Health Plans/Short Term Duration Plans

    1. CBO expects it to take until 2023 for the markets for these plans to reach maturity.

    2. They expect approximately 4 million enrollees in AHP (90% from ACA markets) and 2 million enrollees in short term duration plans (65% from individual market).

    3. Premiums will be 2-3% higher than they otherwise would have been.

  4. Wakely gets a shout out

    1. CBO cited Wakely’s analysis of short-term duration plans in their work (see page 11 footnote 5).

  5. In absolute terms Medicaid and Medicare enrollment and the number of uninsured are expected to increase over the next ten years while enrollment in employer-sponsored insurance and the non-group market are expected to contract.

  6. CBO will release its budget score for the President’s budget in the coming weeks.

     

State Actions on Short Term Plans. Some states are putting restrictions on short term plans in preparation for the forthcoming final Federal regulation which is expected to reduce restrictions. In California, a bill is advancing that would ban short term plans generally while in Illinois a bill is advancing that would restrict coverage to six months.

Medicaid Work Requirements- Michigan is looking like the likeliest candidate to be the next state to submit to CMS a work requirement. An agreement on the exact requirement (20 hour work requirement, no exemption for county level uninsured rate) seems close.

Economic Data of the Day – The Federal Reserve released its annual economic well-being report. According to their statistics approximately 40% of adults if faced with $400 of unexpected costs would be unable to pay it or would need to sell major assets to cover those costs. Given the growing enrollment in high deductible plans, health care costs and their effect on overall financial well-being will continue to be a salient topic.