Alexander-Murray Obamacare stabilization bill would reduce the deficit, CBO says

McConnell: Alexander-Murray depends on Trump
McConnell: Alexander-Murray depends on Trump

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(CNN)The bipartisan Senate Obamacare stabilization bill would reduce the deficit by $3.8 billion over the next decade and would not substantially change the number of people with health insurance, the nonpartisan Congressional Budget Office said Wednesday.

The bill, authored by Republican Sen. Lamar Alexander of Tennessee and Democratic Sen. Patty Murray of Washington, would fund Obamacare's cost-sharing subsidies for the next two years, while providing more flexibility to states to adapt the health reform law's regulations to their needs. It would also open up "copper" plans, which have lower premiums but higher deductibles, to enrollees older than age 30, while requiring the Trump administration to spend $106 million on outreach and enrollment assistance in 2018 and again in 2019.
President Donald Trump announced earlier this month that he was ending federal support for the subsidies, which reduce deductibles and co-pays for lower-income enrollees.
Trump has sent mixed messages on the Alexander-Murray bill. Senate Majority Leader Mitch McConnell has signaled openness to putting it on the Senate floor for a vote if Trump gives his blessing.
    "The White House has the ball," Alexander said Tuesday. "I think it's up to the White House to take the suggestions, work with Senate and House leaders, and come up, and decide, what the President would like to do."
    Adding to the uncertainty, two top congressional Republicans -- House Ways and Means Chairman Kevin Brady and Senate Finance Chairman Orrin Hatch -- unveiled a plan Tuesday that would fund the cost-sharing subsidies, but would strike, for at least a few years, central components of the Affordable Care Act.
    Funding the cost-sharing subsidies would not affect federal spending because the payments are already in the CBO's baseline projections. However, since the fate of the subsidy funding was uncertain, most states allowed insurers to raise their premiums for 2018 to shield themselves.
    It's too late for insurers to change the rates for next year, so the CBO expects the federal government would receive $3.1 billion in rebates from insurers since they would be paid the cost-sharing subsidies if the bill passes. Enrollees would also receive rebates, but CBO did not specify the amount.
    Also, CBO expects more states would file waivers since they would no longer need to enact legislation before submitting applications. Also, the Department of Health & Human Services would have to rule on the applications more swiftly. These waivers would be much more limited in scope than those that would have been allowed under the now-shelved House and Senate bills to repeal Obamacare.
    "This nonpartisan analysis shows that our bill provides savings and ensures that funding two years of cost-sharing payments will benefit taxpayers and low-income Americans, not insurance companies," according to a joint statement from Alexander and Murray. "CBO has also told us that if CSRs are not paid, premiums in 2018 will go up an average of 20%, the federal debt will increase by $194 billion over 10 years, due to the extra cost of subsidies to pay the higher premiums, and up to 16 million Americans may live in counties where they are not able to buy any insurance in the individual market."
    Twelve Republican and 12 Democratic senators have co-sponsored the legislation.