Budget Group Says Changes to AHCA Negate Half of Deficit Savings

Budget Group Says Changes to AHCA Negate Half of Deficit Savings


One of the few constituencies that wasn’t completely horrified by the Congressional Budget Office’s evaluation of the American Health Care Act last week was the loose collection of budget hawks in Washington. The bill, for all its faults, promised to reduce the federal deficit, if only modestly, over the coming decades.

Now, though, as House leaders have begun making changes and concessions to buy the votes of Republican holdouts, they are paying the price for people who view major changes in federal health care policy through the lens of long-term fiscal stability.

Related: A Politically Damaged Trump Will Try to Rally GOP Behind AHCA

In a blog post on Tuesday, the Committee for a Responsible Federal Budget said that a rough analysis of two Manager’s Amendments to the bill, which began circulating Monday night and outlined various proposed changes, would slash the bill’s impact on the deficit by up to fifty percent.

“As far as we can tell, these changes seem likely to cut the deficit reduction in the bill by roughly half over the next decade and even more over the second decade. Regarding coverage impact, it does not appear that these amendments by themselves would change the original bill's coverage impact much (at least without more details on the tax credit changes), but it seems likely that coverage would be further reduced due to the Medicaid changes.”

The changes include giving the Senate the ability to add $85 billion to the tax credits already proposed for Americans over 50 who are not yet eligible for Medicare. They would also give states the ability to decide between accepting block grant funding for Medicaid or per capita funding.

The changes would also impact the federal Treasury on the revenue side, by accelerating the elimination of taxes imposed under the Affordable Care Act, the legislation that AHCA is meant to repeal and replace.

Related: With Medicaid Costs Soaring, Republicans Plan Dramatic Eligibility Changes

“With these changes included, we roughly estimate that the amended version will reduce deficits by between $150 billion and $200 billion, as opposed to the $337 billion in the original bill,” CRFB wrote on Tuesday.

“As we have noted previously, the relatively modest amount of deficit reduction in AHCA compared to the savings from ACA repeal and Medicaid reforms in previous balanced budget resolutions will make it harder for Congress to balance the budget. The changes in the manager's amendment make that task even harder.”

The CRFB analysis was the second awkward review of the GOP health care plan released Tuesday. Earlier in the day, Margot Sanger-Katz, of The New York Times pointed out that when CBO reports are compared, the enactment of the AHCA -- despite the claim that it is a “replacement” for the ACA -- would actually result in more people losing their health care than if Obamacare were simply repealed and not replaced at all.