The Congressional Budget Office (CBO) on Tuesday found that the House Republican healthcare reform package, which is slated for a Wednesday vote, lowers premiums by 11 percent and would save $35.6 billion.
Speaker Mike Johnson (R-LA) and House Republicans last week unveiled the Lower Health Care Premiums for All Americans Act, which would:
- Increase transparency for pharmacy benefit managers (PBMs)
- Appropriate cost-sharing reduction payments (CSRs) that would lower premiums
- Expand access to Health Association Plans (AHPs) that would allow self-employed workers and other membership-based organizations such as Costco, Amazon, and Sam’s Club to create their own health insurance pools
- Ensure small- and mid-sized employers can protect themselves from catastrophic claims
- Codify first Trump term-era rules that would allow employers to offer defined contributions to employees to purchase their own health insurance
The CBO, and the Joint Committee on Taxation, found that this would lower benchmark health insurance premiums by 11 percent and save $35.6 billion through 2035, or the next ten years. On the other hand, it would reduce the number of people with health insurance by 100,000 over ten years.
The analysis by the nonpartisan groups largely mirrors a report from the Paragon Health Institute, which found that the GOP bill would save $30 billion and reduce premiums by 12 percent. The reduction in premiums largely arises by appropriating cost-sharing reduction payments.
Association Health Plans would also offer much lower premiums compared to Obamacare:
Savings from these new AHPs were as high as 23 percent to 29 percent (depending on commercially insured versus self-funded plans). As The Washington Post noted at the time, a review of over two dozen of these health plans indicated they were “offering generous benefits and premiums lower than can be found in the Obamacare marketplaces.” The rule allowed groups like the Southern Arizona Chamber of Commerce to offer affordable coverage to small businesses in seven southern Arizona counties. Despite this promising start, 11 states successfully sued to block the rule, and these coverage options were forced out of the market.
The House will vote on the bill Wednesday. However, it may face complications as there will not be a vote on an amendment that would extend the expiring enhanced Obamacare subsidies, much to the chagrin of moderate House Republicans such as Rep. Mike Lawler (R-NY).
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