The Affordable Care Act Reduces The Deficit

CBO Estimated That The Affordable Care Act Will Reduce Deficits By Over $200 Billion From 2012-2021. According to Congressional Budget Office Director Douglas Elmendorf’s testimony before the House on March 30, 2011: “CBO and JCT’s most recent comprehensive estimate of the budgetary impact of PPACA and the Reconciliation Act was in relation to an estimate prepared for H.R. 2, the Repealing the Job-Killing Health Care Law Act, as passed by the House of Representatives on January 19, 2011. H.R. 2 would repeal the health care provisions of those laws. CBO and JCT estimated that repealing PPACA and the health-related provisions of the Reconciliation Act would produce a net increase in federal deficits of $210 billion over the 2012–2021 period as a result of changes in direct spending and revenues. Reversing the sign of the estimate released in February provides an approximate estimate of the impact over that period of enacting those provisions. Therefore, CBO and JCT effectively estimated in February that PPACA and the health-related provisions of the Reconciliation Act will produce a net decrease in federal deficits of $210 billion over the 2012–2021 period as a result of changes in direct spending and revenues.” [Douglas Elmendorf Testimony via CBO.gov, 3/30/11]

“Nearly $2 Trillion” Refers To Gross Cost Of Insurance Provisions, Does Not Account For Savings

The narrator’s claim that “Obamacare will cost taxpayers nearly $2 trillion” is paired with an image reading: “COST: $1.76 TRILLION,” cites the CBO on March 15, 2012.

March 2012: CBO Estimated ACA “Provisions Related To Insurance Coverage” Will Have “Gross Cost” Of $1.762 Trillion. According to a Congressional Budget Office report titled “Updated Estimates for the Insurance Coverage Provisions of the Affordable Care Act”: “This report also presents estimates through fiscal year 2022, because the baseline projection period now extends through that additional year. The ACA’s provisions related to insurance coverage are now projected to have a net cost of $1,252 billion over the 2012–2022 period (see Table 2, following the text); that amount represents a gross cost to the federal government of $1,762 billion, offset in part by $510 billion in receipts and other budgetary effects (primarily revenues from penalties and other sources).” [CBO.gov, March 2012, emphasis added]

• July 2012: CBO’s Updated Estimate For Gross Cost Of ACA Insurance Coverage Provisions Is $1.683 Trillion. According to a Congressional Budget Office Report titled “Estimates for the Insurance Coverage Provisions of the Affordable Care Act Updated for the Recent Supreme Court Decision”: “CBO and JCT now estimate that the insurance coverage provisions of the ACA will have a net cost of $1,168 billion over the 2012–2022 period—compared with $1,252 billion projected in March 2012 for that 11-year period. That net cost reflects the following: Gross costs of $1,683 billion for Medicaid, CHIP, tax credits, and other subsidies for the purchase of health insurance through the newly established exchanges (and related costs), and tax credits for small employers. […] Those gross costs are offset in part by $515 billion in receipts from penalty payments, the new excise tax on high-premium insurance plans, and other budgetary effects (mostly increases in tax revenues stemming  from changes in employer-provided insurance coverage).” [CBO.gov, July 2012, internal citations removed]
• July 2012 Report Affirmed Projection That ACA Will Reduce Deficits. According to a Congressional Budget Office Report titled “Estimates for the Insurance Coverage Provisions of the Affordable Care Act Updated for the Recent Supreme Court Decision”: “CBO and JCT have not updated their estimate of the overall budgetary impact of the ACA; previously, they estimated that the law would, on net, reduce budget deficits.” [CBO.gov, July 2012]

GOP Argument That Obamacare Will “Kill Jobs” Has Been Debunked

FactCheck.org: “Job-Killing” Claim Is “Health-Care Hooey.” From FactCheck.org: “The exaggerated Republican claim that the new health care law ‘kills jobs’ was high on our list of the ‘Whoppers of 2011.’ But the facts haven’t stopped Republicans and their allies from making the ‘job-killing’ claim a major theme of their campaign 2012 TV ads. […] All of this is health-care hooey, aimed at exploiting public concern over continuing high unemployment, with little basis in fact. As we’ve said before (a few times), experts project that the law will cause a small loss of low-wage jobs — and also some gains in better-paid jobs in the health care and insurance industries. It’s also expected that more workers will decide to retire earlier, or work fewer hours, when they no longer need employer-sponsored insurance and can obtain it on their own with help from federal subsidies. But that just means fewer people willing to work — and it will free up jobs for those who want them. If anything, that could reduce the jobless rate.” [FactCheck.org, 2/21/12]

• AP: Republicans Misuse CBO Statistics To Support “Job-Killing” Claim About Health Care Overhaul. From the Associated Press:  “A recent report by House GOP leaders says ‘independent analyses have determined that the health care law will cause significant job losses for the U.S. economy.’ It cites 650,000 lost jobs as Exhibit A, and the nonpartisan Congressional Budget Office as the source of the analysis behind that estimate. But the budget office, which referees the costs and consequences of legislation, never produced that number. What CBO actually said is that the impact of the health care law on supply and demand for labor would be small. Most of the lost jobs would come from people who no longer have to work, or can downshift to less demanding employment, because insurance will be available outside the job. ‘The legislation, on net, will reduce the amount of labor used in the economy by a small amount — roughly half a percent— primarily by reducing the amount of labor that workers choose to supply,’ budget office number crunchers said in a report last year.” [Associated Press via USA Today, 1/24/10]

Chamber Distorts CBO Expectations To Fearmonger On Lost Coverage

The ad cites the CBO on March 15, 2012, to support the claim that Obamacare “could disrupt coverage for millions.”

Up To 30 Million People Are Expected To Gain Coverage Through The Affordable Care Act. From the Congressional Budget Office: “CBO and JCT now estimate that the ACA, in comparison with prior law before the enactment of the ACA, will reduce the number of nonelderly people without health insurance coverage by 14 million in 2014 and by 29 million or 30 million in the latter part of the coming decade, leaving 30 million nonelderly residents uninsured by the end of the period. … The share of legal nonelderly residents with insurance is projected to rise from 82 percent in 2012 to 92 percent by 2022. According to the current estimates, from 2016 on, between 23 million and 25 million people will receive coverage through the exchanges, and 10 million to 11 million additional people will be enrolled in Medicaid and CHIP as a result of the ACA. Between 4 million and 6 million fewer people are estimated to have coverage through an employer, compared with coverage in the absence of the ACA. That number did not change significantly as a result of the Court’s decision.” [CBO.gov, July 2012]

Affordable Care Act Projected To Cause Small Reduction In Employer-Based Coverage, But Could Also Increase Such Coverage. From the Congressional Budget Office: “CBO and JCT continue to expect that the ACA will lead to a small reduction in employment-based health insurance. […] In CBO and JCT’s judgment, a sharp decline in employment-based health insurance as a result of the ACA is unlikely and, if it occurred, would not dramatically increase the cost of the ACA. […] As reflected in CBO’s latest baseline projections, the two agencies now anticipate that, because of the ACA, about 3 million to 5 million fewer people, on net, will obtain coverage through their employer each year from 2019 through 2022 than would have been the case under prior law. […] In the four alternative scenarios examined, the ACA changes the number of people who will obtain health insurance coverage through their employer in 2019 by an amount that ranges from a reduction of 20 million to a gain of 3 million relative to what would have occurred otherwise. According to the CBO’s July update, the number of people expected to lose employer-based coverage “did not change significantly,” and is now estimated at between “4 million and 6 million fewer people.” [CBO.gov, 3/15/12; CBO.gov, July 2012]

“Law Could Just As Well Increase” Workplace Coverage By 3 Million. From The Hill‘s report on the same March 15 CBO report cited by the Chamber: “As many as 20 million Americans could lose their employer-provided coverage because of President Obama’s healthcare reform law, the nonpartisan Congressional Budget Office said in a new report Thursday. The figure represents the worst-case scenario, CBO says, and the law could just as well increase the number of people with employer-based coverage by 3 million in 2019.  The best estimate, subject to a ‘tremendous amount of uncertainty,’ is that about 3 million to 5 million fewer people will obtain coverage through their employer each year from 2019 through 2022.” [The Hill, 3/15/12]

CBO: Other Analyses Consistent With Our Best-Guess Scenario. From the CBO report cited by the Chamber: ” Other analysts who have carefully modeled the nation’s existing health insurance system and the changes in incentives for employers to offer insurance coverage created by the ACA have reached conclusions similar to those of CBO and JCT or have predicted smaller declines (or even gains) in employment-based coverage owing to the law. Surveys of employers regarding their plans for offering health insurance coverage in the future have uncertain value and offer conflicting findings.” [CBO.gov, 3/15/12]

CBO: Similar Massachusetts Reforms Have Led To Increase In Employer-Provided Coverage. From the CBO report cited by the Chamber: “One piece of evidence that may be relevant is the experience in Massachusetts, where employment-based health insurance coverage appears to have increased since that state’s reforms, which are similar but not identical to those in the ACA, were implemented.” [CBO.gov, 3/15/12]

Plans In The Insurance Market Are Already Unstable, Causing Eroding Coverage And Higher Premiums. According to Time: “Still, while many employer-based plans will be snared in the regulatory net of the Patient Protection and Affordable Care Act, many of those with this coverage could actually stand to benefit. The new regulations, after all, are designed to protect consumers. If job-based plans have to change — and are not dropped by employers — they will do so in ways that limit what workers have to pay out of pocket and what insurers can refuse to cover. […] Plus, it’s not as though the employer-based insurance market is reliable and stable in its current form. Most employees don’t have any control over the structure of their health insurance. As a result, coverage has been steadily eroding in the past decade, with premium costs for workers increasing 131% from 1999 to 2009, even as the actuarial value of those plans, on average, decreased.” [Time, 6/24/10]

Repeal Would Have Negative Consequences For Millions

Up To 6.6 Million Young Adults Would Lose Health Care Coverage Through Their Parents’ Plans. From the Los Angeles Times: “President Obama’s healthcare law helped as many as 6.6 million young adults stay on or get on their parents’ health plans in the first year and a half after the law was signed, a new survey indicates. […] Earlier surveys by the federal government found that the number of people ages 19 to 25 without insurance declined after the law was signed, reversing years of erosion in health coverage for young adults.” [Los Angeles Times, 6/8/12]

70,000 Americans With Pre-Existing Conditions Would Lose Insurance Coverage. According to the Department of Health and Human Services, as of May 31, 2012, 73,333 people were enrolled in the Pre-Existing Condition Insurance Plan (PCIP) created by the Affordable Care Act. [HealthCare.gov, 7/13/12]

5.2 Million People Would Have To Pay More For Prescription Drugs. From the Centers for Medicare and Medicaid: “As a result of the Affordable Care Act, over 5.2 million seniors and people with disabilities have saved over $3.9 billion on prescription drugs since the law was enacted.  The Centers for Medicare & Medicaid Services (CMS) also released data today showing that in the first half of 2012, over 1 million people with Medicare saved a total of $687 million on prescription drugs in ‘donut hole’ coverage gap for an average of $629 in savings this year. […] Coverage for both brand name and generic drugs in the gap will continue to increase over time until 2020, when the coverage gap will be closed.” [CMS.gov, 7/25/12]

Over 35 Million Seniors Would Lose Access To Free Preventive Services. The Centers for Medicare and Medicaid Services [CMS] report that 35,106,598 people were enrolled in Medicare Part B in 2011. CMS also reports:

Beginning January 1, 2011, the Affordable Care Act eliminated Part B coinsurance and deductibles for recommended preventive services, including many cancer screenings and key immunizations. The law also added an important new service — an Annual Wellness Visit with a health professional — at no cost to beneficiaries.

According to preliminary numbers, at least 25,720,996 million Americans took advantage of at least one free preventive benefit in Medicare in 2011, including the new Annual Wellness Visit.  This represents 73.3% of Medicare fee-for-service beneficiaries, including 2,404,792 African-American beneficiaries, 537,110 Hispanic beneficiaries, 104,393 American Indian beneficiaries, and 508,398 Asian-American beneficiaries. [CMS.gov, 2/15/12]

Health Insurers Poured Money Into Chamber To Attack Reform

Health Insurance Industry Gave Chamber Over $100 Million To Fight Health Care Reform. From the National Journal: “The nation’s leading health insurance industry group gave more than $100 million to help fuel the U.S. Chamber of Commerce’s 2009 and 2010 efforts to defeat President Obama’s signature health care reform law, National Journal’s Influence Alley has learned. During the final push to kill the bill before its March 2010 passage, America’s Health Insurance Plans gave the chamber $16.2 million. With the $86.2 million the insurers funneled to the business lobbying powerhouse in 2009, AHIP sent the chamber a total of $102.4 million during the health care reform debate, a number that has not been reported before now. The backchannel spending allowed insurers to publicly stake out a pro-reform position while privately funding the leading anti-reform lobbying group in Washington. The chamber spent tens of millions of dollars bankrolling efforts to kill health care reform.” [NationalJournal.com, 6/13/12]