What Will The CBO Count As Health Insurance?

Health

My colleague Avik Roy has suggested that passing a full Obamacare replacement (as opposed to a partial replacement passed via reconciliation) might be possible even though it would require Democratic votes to obtain the 60-vote threshold in the Senate, and that a pre-condition to achieving that would require the Congressional Budget Office (CBO) score the replacement as covering at least as many people as the Obamacare does.

As if to give a warning shot across the Republican bow, the officially non-partisan CBO warned that it “would not count those people with limited health benefits as having coverage” when evaluating changes to the health care law, and that changes to the “essential health benefits” required under the ACA could result in people receiving tax credits to help pay for health insurance under a new law, but being counted as not having health insurance according to the CBO, if the coverage they have doesn’t meet the CBO’s requirements. At issue, basically, is “What is health insurance?”

An unspoken, but at least equally important issue is that the criteria has become the number of people the CBO estimates will be covered – which is not the same as the number of people actually covered. CBO estimates are statements about the future, so they are necessarily just estimates. Current enrollment in individually-purchased health plans is now running at about 75% of the level projected by the CBO in 2009, which means that about 7 million fewer people are covered than CBO initially projected. Furthermore, changes made by the Census Bureau to the methods used for collecting health coverage data both reduced the measured number of uninsured (regardless of any policy or law in place) and made it difficult to compare pre- and post-ACA coverage patterns.

These two issues – the definition of “health coverage” and the mismatch between predictions and actual experience – will both require careful attention in the months ahead as Congress seeks to repair the health insurance system.

One of the issues with the definition of health related to one of the problems with the ACA itself. Of the many reasons that premiums and deductibles have increased so dramatically is that the ACA has a much more extensive list of items that must be covered in all plans than was required before. As a result, people no longer have the option to purchase lower-cost plans that exclude covered for items they know they will not need. (This is, of course, far from the only reason why premiums and deductibles have increased.)

Also, the option to purchase “catastrophic” coverage – coverage with protects against high-cost diseases and injuries, but provides limited or no coverage for routine care – has been limited to those under age 30 or eligible for an exemption from the individual mandate. It also requires coverage of certain routine care that pre-ACA catastrophic plan usually did not cover. This makes ACA catastrophic plans both more expensive, and much less widely available, than pre-ACA catastrophic plans.

If Congress proposes to address the rising cost of health coverage in part by reducing coverage mandates and re-legalizing catastrophic coverage for the general population, that could substantially reduce the number of uninsured and reduce costs for many of those who currently have coverage. But, would the CBO count the beneficiaries of these changes as “uninsured” when making its projections?

Insights into health care and entitlement reform.

Robert BookRobert Book, Contributor

My colleague Avik Roy has suggested that passing a full Obamacare replacement (as opposed to a partial replacement passed via reconciliation) might be possible even though it would require Democratic votes to obtain the 60-vote threshold in the Senate, and that a pre-condition to achieving that would require the Congressional Budget Office (CBO) score the replacement as covering at least as many people as the Obamacare does.

As if to give a warning shot across the Republican bow, the officially non-partisan CBO warned that it “would not count those people with limited health benefits as having coverage” when evaluating changes to the health care law, and that changes to the “essential health benefits” required under the ACA could result in people receiving tax credits to help pay for health insurance under a new law, but being counted as not having health insurance according to the CBO, if the coverage they have doesn’t meet the CBO’s requirements. At issue, basically, is “What is health insurance?”

An unspoken, but at least equally important issue is that the criteria has become the number of people the CBO estimates will be covered – which is not the same as the number of people actually covered. CBO estimates are statements about the future, so they are necessarily just estimates. Current enrollment in individually-purchased health plans is now running at about 75% of the level projected by the CBO in 2009, which means that about 7 million fewer people are covered than CBO initially projected. Furthermore, changes made by the Census Bureau to the methods used for collecting health coverage data both reduced the measured number of uninsured (regardless of any policy or law in place) and made it difficult to compare pre- and post-ACA coverage patterns.

These two issues – the definition of “health coverage” and the mismatch between predictions and actual experience – will both require careful attention in the months ahead as Congress seeks to repair the health insurance system.

One of the issues with the definition of health related to one of the problems with the ACA itself. Of the many reasons that premiums and deductibles have increased so dramatically is that the ACA has a much more extensive list of items that must be covered in all plans than was required before. As a result, people no longer have the option to purchase lower-cost plans that exclude covered for items they know they will not need. (This is, of course, far from the only reason why premiums and deductibles have increased.)

Also, the option to purchase “catastrophic” coverage – coverage with protects against high-cost diseases and injuries, but provides limited or no coverage for routine care – has been limited to those under age 30 or eligible for an exemption from the individual mandate. It also requires coverage of certain routine care that pre-ACA catastrophic plan usually did not cover. This makes ACA catastrophic plans both more expensive, and much less widely available, than pre-ACA catastrophic plans.

If Congress proposes to address the rising cost of health coverage in part by reducing coverage mandates and re-legalizing catastrophic coverage for the general population, that could substantially reduce the number of uninsured and reduce costs for many of those who currently have coverage. But, would the CBO count the beneficiaries of these changes as “uninsured” when making its projections?

The CBO’s statement on the topic is not entirely unambiguous. Writing on the CBO blog, Jared Maeda and Susan Yeh Beyer state that, “CBO broadly defines private health insurance coverage as a comprehensive major medical policy that, at a minimum, covers high-cost medical events and various services, including those provided by physicians and hospitals.”

[SOURCE:-Forbes]