CBO: Obamacare still cuts deficit

Updated
 

One of the more common complaints from critics of the Affordable Care Act is that it’s too expensive. In particular, congressional Republicans, who occasionally pretend to care about the deficit and debt, argue that the health care reform law is fiscally irresponsible.

The argument has never made any sense – every independent budget analysis has shown that “Obamacare” is not only fully paid for, it also reduces the deficit.

Of course, that was before the recent U.S. Supreme Court ruling. What does the nonpartisan Congressional Budget Office have to say about the ACA now? As it turns out, the law still reduces the deficit, and Republican repeal efforts would worsen U.S. finances.

The Congressional Budget Office just published a newly updated estimate of the Affordable Care Act and its impact on the budget. The estimate largely tells us what we already knew: The law, when fully implemented, will dramatically reduce the number of Americans without health insurance. It will also reduce the deficit.

This last part remains a big deal, if only because so many conservatives – and, yes, so many members of the public – refuse to believe it. Over and over again, you hear people saying that Obamacare will run up the deficit. The CBO, which is our most reliable guide on such matters, begs to differ. […]

And that’s just in the short- to medium-term. If the program’s efforts at re-engineering the health care system really work, then all spending on health care – from the federal government, corporations, and individuals alike – will stop rising so quickly, freeing up more money for other purposes (like, for example, raises to employees).

This is no minor realization. Mitt Romney has argued nearly every day for a year that he has to destroy health care reform because it costs too darn much. He’s not telling the truth – the Affordable Care Act reduces the deficit. If he and congressional Republicans kill the law, they’ll not only take affordable medical care away from millions, they’ll also increase the deficit.

How much money are we talking about here? According to the CBO’s new estimates – and admittedly, they are only estimates projecting future events – repealing the ACA would cost the nation $109 billion over the next decade. To my mind, this means every Republican vowing to eliminate the entirely of the law should be asked a simple question: will you pay for repeal (and if so, how) or will you put another $109 billion on the national credit card?

It’s also worth noting, of course, that there were far more discouraging aspects of the new CBO score on the Affordable Care Act. The budget analysts said the law will reduce the deficit, but they also said the Supreme Court ruling undermines the scope of new coverage in important ways.

The Congressional Budget Office said Tuesday that the Supreme Court decision on President Obama’s health care overhaul would probably lead to an increase in the number of uninsured and a modest reduction in the cost to the federal government when compared with estimates before the court ruling.

Of the 33 million people who had been expected to gain coverage under the law, 3 million fewer are now predicted to get insurance, the budget office said in assessing the likely effects of the court decision.

The court said, in effect, that a large expansion of Medicaid envisioned under the 2010 law was a state option, not a requirement.

While it is not yet clear how many states will ultimately opt out of the expansion, the budget office said it now predicted that six million fewer people would be insured by Medicaid, the federal-state program for low-income people. Half of them, it said, will probably gain private insurance coverage through health insurance exchanges to be established in all states.

The difference may not seem that significant – the law will bring coverage to 30 million uninsured Americans, instead of 33 million – but if you’re one of the people who’ll slip through the cracks because of the Supreme Court ruling, it’s going to matter a great deal.

Still, in terms of the election-year fight, the key takeaway seems to be the fiscal angle to the CBO report. Republicans are likely to spend the next few months talking about the “debt crisis,” and the need to “think of the burden on our children.” At the same time, they’ll push a repeal crusade that will make the debt worse and add to the burdens of future generations.

Congressional Budget Office, Affordable Care Act, Debt and Obamacare

CBO: Obamacare still cuts deficit

Updated