兰德-The-Effects-of-the-American-Health-Care-Act-on-Health-Insurance-Coverage-and-Federal-Spending-in-2020-and-2026_42页_608kb

Summary of the Effects of the American Health Care Act on Health Insurance Coverage and Federal Spending

Core Content

This report analyzes the potential effects of the American Health Care Act (AHCA), a 2017 bill proposed by the U.S. House of Representatives, on health insurance coverage and federal spending in the U.S. compared to the Affordable Care Act (ACA). The study uses the RAND Corporation's COMPARE microsimulation model to estimate the impact of the AHCA's major provisions on insurance enrollment, consumer costs, and the federal deficit in 2020 and 2026.

Main Findings

• Health Insurance Enrollment: The AHCA would have led to a significant reduction in health insurance coverage. In 2020, it is estimated that 14.2 million people would have lost coverage, with Medicaid enrollment dropping by nearly 10 million and individual-market enrollment decreasing by 4.1 million. By 2026, the number of uninsured individuals would have risen to 19.7 million, with Medicaid enrollment decreasing by 13.6 million and individual-market enrollment by 6.9 million.

• Demographic Impact: The AHCA disproportionately affected certain groups. In 2020, the number of uninsured individuals aged 50–64 would have increased by 119% compared to a 42% increase for those under 50. For individuals with incomes at or below 200% of the Federal Poverty Level (FPL), the increase in the uninsured would have been 80%, while for those above 200% FPL, it would have been 15%. Individuals in poor or fair health would have seen a 99% increase in the number of uninsured people.

• Federal Spending: The AHCA would have reduced federal spending on coverage expansions by $71 billion in 2020. However, it would have increased the federal deficit by $38 billion in 2020 and reduced it by $5 billion in 2026. These estimates reflect one-year changes and differ from the Congressional Budget Office (CBO)’s cumulative $150 billion deficit reduction over ten years due to different assumptions about market stability and consumer behavior.

• Key Provisions Modeled:

  • Tax Credits: The AHCA replaced ACA's income-based tax credits with age-based credits, ranging from $2,000 to $4,000 per individual and up to $14,000 per household. Credits would have grown at the CPI + 1% rate.
  • Medicaid Funding: The AHCA converted Medicaid federal funding to a per-capita allotment based on 2016 spending, with different growth rates for different populations. This change would have led to states reducing Medicaid eligibility for non-disabled adults.
  • Age Rating Bands: Insurers could charge older adults up to five times as much as younger adults, compared to the ACA's three times limit.
  • Mandates: Both the individual and employer mandates were eliminated.
  • Continuous Coverage Requirement: A 30% surcharge on premiums was introduced for those with coverage gaps.
  • HSAs: The AHCA encouraged HSAs by increasing contribution limits and reducing penalties for non-medical withdrawals.
  • Excise Tax Delay: The excise tax on high-cost employer plans was delayed until 2026.
  • Stability Fund: A $15 billion fund was allocated in 2018 and 2019, and $10 billion annually from 2020 to 2026, intended to support reinsurance in the individual and small-group markets.

Key Differences from CBO Estimates

• The AHCA's impact on coverage and deficit is smaller in 2020 and larger in 2026 compared to CBO's projections.
• These differences are due to variations in assumptions about consumer confusion, insurer mispricing, and the stability of employer-sponsored coverage.
• CBO's baseline was from March 2016, which was updated later, leading to different results.

Methodology

• The study used the COMPARE model to simulate the AHCA's effects.
• Assumptions included the use of the AHCA's tax credits for reinsurance and the reaction of states to reduce Medicaid eligibility to maintain budget neutrality.
• The analysis considered the real value of federal investments and how they might diminish over time due to inflation.

Conclusion

The AHCA would have had a significant negative impact on health insurance coverage, particularly for older, lower-income, and sicker individuals. While it would have reduced the federal deficit in the long term, its short-term effects would have increased the deficit by $38 billion in 2020. The study highlights the importance of assumptions in modeling health care reform and underscores the potential consequences of eliminating key ACA provisions like tax credits, mandates, and cost-sharing reductions.