Maybe — Just Maybe — the CBO Can't be Trusted on Healthcare Projections

It took me three thorough read-throughs of this piece from conservative analyst Avik Roy to understand exactly what he was getting at: namely that the Congressional Budget Office is saying people that opt out of buying healthcare insurance because they are no longer required to purchase it (once the individual mandate is repealed along with the rest of the horrid Obamacare law) will be losing their coverage. And that the CBO is further using that rhetorical gibberish to criticize the new Senate health care legislative efforts.


The CBO’s love affair with the individual mandate is the reason why there’s really nothing Republican senators can do to improve the CBO’s coverage score of their bill. It doesn’t matter how much money Republicans throw at the problem; if you don’t have an individual mandate, CBO assumes 16 million fewer people will have coverage right off the bat. It doesn’t matter if you keep nearly all of Obamacare’s spending and most of its taxes, as Sens. Bill Cassidy (La.) and Lindsey Graham (S.C.) propose: CBO assumes 16 million fewer people will have coverage right off the bat.

So, the choice for Republicans is this. Do you support repealing Obamacare’s individual mandate, or preserving it? If you support repealing it—whatever other policy details you prefer—the CBO is going to generate misleading headlines about 16 million people being “kicked off” their insurance.

And of course, that is exactly what’s happening:

What this basically means is that the CBO would have everyone believe that 16 or 17 million people will be forcibly kicked off their coverage — instead of voluntarily choosing not to purchase since the mandate that they do so no longer exists — and that they will then be lost in the hinterlands of no health coverage because there will be no other options available to them once they are bounced out of the healthcare insurance bar.


Which is absurd. As Roy explains:

The GOP Senate health reform bill does repeal Obamacare’s Medicaid expansion. But it replaces it with a robust system of tax credits and block grants that ensure that every single person enrolled in that Medicaid expansion will get financial assistance to afford private coverage. Senate Republicans could spend even more money covering Obamacare enrollees’ health care costs—and they might want to—but the CBO’s model is designed to treat any mandate-repealing GOP bill as covering fewer people than Obamacare.

Columnist Andrew Malcom and Professor Randy Barnett explain it even more succinctly on Twitter:

And The White House, As the Senate prepares to vote on Obamacare repeal today, is hammering home that the CBO’s numbers are simply not to be trusted:

The one question that remains for me — and I assume others — is why no major media outlet is talking about the fact that the 16 million that supposedly bought Obamacare because of the mandate is also, in all likelihood, a seriously inflated number. I just have a really hard time believing that many people actually bought Obamacare. Which means the number of people who will be without healthcare insurance is not only not the result of being kicked off their insurance plans, but is also a lot smaller number.


Ah well. Depending on what the Senate does today, perhaps it will become a moot point soon enough. Fingers crossed.


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