The Congressional Budget Office (CBO) recently released the official forecast for the Republican Senate's Trumpcare plan. The Senate's Trumpcare would have similar effects to the House's Trumpcare, but there are some key differences for insurance customers.
Here's how the Senate version would affect coverage, costs, taxes, and insurance plans in America.
22 million fewer Americans would have health insurance
Under the Senate version of Trumpcare, the number of uninsured Americans would nearly double, to 49 million. The increase would be due primarily to elimination of the individual mandate in Obamacare requiring individuals to purchase health insurance, lower Medicaid spending, and reduced financial assistance for individuals to buy insurance.
Middle- and lower-income Americans would lose coverage the most
The rate of uninsured would rise across all ages and income levels, but more middle- and lower-income Americans could lose coverage. Here are the increases in the uninsured rates broken down by age and income:
$772 billion in cuts to Medicaid
Obamacare expanded Medicaid health insurance coverage to an estimated 11.2 million more Americans. Trumpcare reverses the Medicaid expansion, cutting Medicaid by $772 billion for the first 10 years.
After 2025 (not shown in the chart), Trumpcare cuts Medicare benefits further by tying benefit increases to the general consumer price index (CPI) instead of the medical-care CPI.
A half-trillion dollars in tax cuts targeting wealthy Americans
Trumpcare eliminates capital gains and Medicare taxes that apply to single-filers earning more than $200,000 per year and couples earning more than $250,000 per year. Medical-device manufacturers, pharmaceutical companies, and indoor tanning salons would also get tax cuts.
The nonpartisan Tax Policy Center calculates that Trumpcare would cut taxes for the top 1% of earners by $45,000 a year; the top 0.1% would get a $248,000 tax cut.
The CBO estimates that tax cuts would be a primary contributor to the federal deficit increasing by $541 billion over the next decade.
A major goal of the Senate plan is to nudge consumers into higher-deductible plans. This is one potential solution to slowing healthcare costs. However, with this approach, patients -- rather than insurers -- bear a higher portion of total healthcare costs.
Trumpcare makes low-deductible plans more expensive. Average premiums for a silver plan could rise 73% under Trumpcare above the rates under Obamacare. But premium changes would vary considerably by age and income.
They would rise much more for older, middle-class, and poorer Americans. For example, a 64-year old making $26,500 -- close to the U.S. median income -- would see his or her annual premiums rise from $1,700 to $6,500.
However some people -- notably young, wealthy Americans -- could see their premiums decline.
It's been widely reported that Trumpcare could result in lower premiums by pushing customers into high-deductible plans. Downgrading from a low-deductible Obamacare plan to a high-deductible Trumpcare plan would save young and middle-aged individuals earning $26,500. People aged 21 who downgrade would save $400, those aged 45, $100. But if you're 64, you'd pay $300 more for a high-deductible Trumpcare than for a low-deductible Obamacare plan.
But that's a misleading comparison from the perspective of patients, because people already have the option of purchasing high-deductible plans under Obamacare. And (again, with the exception of young, high-income customers) high-deductible Trumpcare tends to be more expensive than high-deductible Obamacare.
Higher deductibles and less generous coverage
How much deductibles will rise depends on whether you decide to keep your plan or downgrade to avoid premium increases. While it's difficult to project exact deductible amounts under Trumpcare, data provided by the CBO allows some general estimates to be calculated.
Keep in mind that these are estimated averages; deductibles wouldn't rise as much for younger people, and they would rise a lot more for the elderly.
In addition to deductible increases, Trumpcare would allow states to decide that policies don't need to include services guaranteed by Obamacare, such as hospitalization, maternity care, and mental health.
It's far from certain the Senate will be able to pass its version of Trumpcare. Republicans can only afford to lose two votes, and at least four have said they wouldn't vote for the bill as it's currently written. Some Republican Senators are concerned that people will lose insurance or pay higher premiums, while others don't think the bill goes far enough.
Wrangling enough "yea" votes to pass the bill is made all the more tricky by the fact that only 17% of Americans support Trumpcare, as of the latest poll. But don't count it out yet. The House failed to pass its version of Trumpcare back in March, only to muscle it through on a second try several weeks later. If the Senate does manage to pass a bill, it'll meet up with the House to try to combine the two versions into a Trumpcare that the House, Senate, and Trump agree on.
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