3:14 PM, Apr 14, 2014 • By JAY COST
The Hill reports:
The Congressional Budget Office (CBO) lowered the projected cost of ObamaCare's health insurance benefits Monday by $104 billion over 10 years.
The law's insurance coverage provisions will now cost close to $1.4 trillion between 2015 and 2024, about $100 billion less than previously estimated, the CBO said.
What is driving the lowered estimate? According to the report released by CBO, it has primarily to do with lower-than-expected premiums for exchange policies. So, good news for the Obama administration? Not so fast. Per CBO:
A crucial factor in the current revision was an analysis of the characteristics of plans offered through the exchanges in 2014. Previously, CBO and [the Joint Committee on Taxation] had expected that those plans’ characteristics would closely resemble the characteristics of employment-based plans throughout the projection period. However, the plans being offered through the exchanges this year appear to have, in general, lower payment rates for providers, narrower networks of providers, and tighter management of their subscribers’ use of health care than employment-based plans do.
So far, CBO is only projecting a modest increase in premiums for 2015, although it notes, “actual exchange premiums for 2015 may differ from those CBO and JCT have projected because insurers could have different expectations of their costs for that year.” The late surge of enrollees might help keep rates down, but what really matters is not so much the political class’s expectations of what enrollment would look like as of, say, January, but rather what insurance company projections were when they set rates nearly a year ago.
The factors that will influence rates in 2015 include: (a) increasing healthcare costs in general; (b) the grandfathering of “non-compliant” plans by the Obama administration; (c) the difficulty of estimating the 2014 risk pool because of late enrollees and government limits on what health questions insurers could ask of its customers; (d) differences in the actual versus expected ratio of healthy to unhealthy enrollees; (e) state by state variations in the risk pools and costs of providing care; (f) the “Three R’s” -- risk adjustment, reinsurance, and risk corridors -- meant to limit insurance company losses for the first few years of the program; (g) the partial sunsetting of the reinsurance program, which helped keep rates down in 2014.
Insurers will start filing rates with government regulators later this spring.
A footnote on Obamacare hitting its CBO enrollment target. Despite the "surge" of late enrollees late in the period, CBO did not update its previous prediction of total enrollment (which stood at 6 million as of this winter, down from 7 million last year and a high of 9 million after the Supreme Court Ruling). CBO writes:
CBO and JCT’s estimate of 6 million people receiving such coverage in 2014 cannot be compared directly with the number of people who have enrolled through the exchanges as of any given date. The number of people who will have coverage through the exchanges in 2014 will not be known precisely until after the year has ended
This is exactly the point that conservative critics of Obama's "7.1 million enrollments" have made again and again. Some people will not pay the premiums and thus drop off coverage. Others will gain insurance through their employers and thus drop their individual policy. And so on. The "7.1 million enrollments" claim has no direct bearing either on the fiscal or actuarial condition of Obamacare. It is a purely political claim.
The corrupting effects of Obamacare.Feb 24, 2014, Vol. 19, No. 23 • By JAY COST
On February 4 the Congressional Budget Office dropped a bombshell. Analysts there found that Obamacare’s structure will create an enormous implicit tax on work, such that people on the lower end of the economic scale will have an incentive to quit their jobs or scale back to part time to maximize their premium subsidies. In an earlier study, CBO had estimated that this disincentive to work would destroy the equivalent of less than a million full-time jobs. Now, it projects that an equivalent of more than 2 million jobs will be lost as people voluntarily leave the workforce.
Between 2017-2024.5:01 PM, Feb 8, 2014 • By DANIEL HALPER
New analysis by the minority-side of the Senate Budget Committee finds that Obamacare will reduce compensation by more than $1 trillion between 2017-2024. Analysts in that office have produced this chart to show the lost compensation by year:
As the chart shows, the lost compensation increases every year from an estimated $108 billion in 2017 to an estimated $147 billion 2024. The analysis is based on numbers provided in a recent Congressional Budget Office report on Obamacare.
Hosted by Michael Graham3:15 PM, Feb 5, 2014 • By TWS PODCAST
The WEEKLY STANDARD podcast, with senior writer Stephen F. Hayes on why the Obamacare jobs numbers are trouble for Democrats.
10:49 AM, Feb 5, 2014 • By JEFFREY H. ANDERSON
Remember back when the Democrats tried to sell Obamacare to a skeptical citizenry as health care “reform” that would cost “only” $848 billion—far less than a trillion—over a decade? Indeed, that was the alleged 10-year gross cost of Obamacare’s coverage provisions, according to the Congressional Budget Office (see Table 3), when Harry Reid, Mark Pryor, Kay Hagan, Mary Landrieu, Al Franken, Mark Udall, Jeanne Shaheen, Mark Begich, Mark Warner, and the rest of the Democrats rammed President Obama’s signature legislation through the Senate on Christmas Eve without a single Republican vote. That 12-digit price-tag was widely cited by the New York Times and other sympathetic outlets, who treated it as gospel, even as conservatives observed that it was clearly a sham number.
4:29 PM, Feb 4, 2014 • By GEOFFREY NORMAN
The Congressional Budget Office has come out with a report on the effects of Affordable Care Act on the U.S. economy. As Erik Wasson of The Hill reports, the findings are not pretty.
The folly of OMB’s annual cost-benefit report.Aug 19, 2013, Vol. 18, No. 46 • By IKE BRANNON and SAM BATKINS
Every spring the Office of Management and Budget releases the president’s proposed budget for the upcoming fiscal year. While Congress invites senior administration figures to testify before various committees, and the media pore through the document to elucidate the administration’s priorities, by the end of a week everyone agrees that most of what’s in the budget has little chance of becoming enacted. Afterwards, Congress goes through the motions of passing a budget of its own, with scant regard to what the White House has proposed.
10:33 AM, Jun 4, 2013 • By JEFFREY H. ANDERSON
A big part of Obamacare is its massive expansion of Medicaid. Fortunately, this expansion can’t happen in most states without Republicans freely choosing to make it happen. Unfortunately, far too many Republican governors seem to be confused about the distinction between repealing Obamacare and implementing it.
6:48 AM, Jun 4, 2013 • By JERYL BIER
On Monday, CNBC reported on a new survey that found that two-thirds of Americans currently without health insurance don't know if they will purchase coverage by the deadline, the first day of 2014. The survey was released by InsuranceQuotes.com, a company that offers comparison shopping for insurance, similar to the "marketplaces" envisioned by Obamacare. The results of the survey surprised Laura Adams, senior insurance analyst at the company:
4:45 PM, Sep 2, 2012 • By JEFFREY H. ANDERSON
President Obama's top strategist, David Axelrod, said today on Fox News Sunday that, under Obama, we've had "29 straight months of job growth." Yet, according to the federal government's own figures, 29 months ago, 58.5 percent of Americans were employed. Today, only 58.4 percent of Americans are employed. In other words, any job growth over the past 29 months hasn't even kept up with population growth.
9:02 AM, Aug 23, 2012 • By DANIEL HALPER
Steve Hayes, with A.B. Stoddard and Charles Krauthammer, last night on Fox News:
12:32 PM, Aug 22, 2012 • By DANIEL HALPER
The Washington Times reports:
President Obama and Congress are flirting with both a recession and a bigger jump in unemployment next year unless they head off looming tax increases and spending cuts — but doing so could mean a fifth straight year of trillion-dollar deficits, the government’s chief scorekeeper said Wednesday.
11:16 AM, Aug 22, 2012 • By GEOFFREY NORMAN
In its most dire warning yet about the fiscal cliff yet, the CBO said the economy would contract by 0.5 percent in calendar year 2013 if the Bush-era tax rates expire and automatic spending cuts are implemented. Unemployment also would rise from 8.2 percent in 2012 to 9.1 percent next year, it estimates.
10:25 AM, Mar 26, 2012 • By JEFFREY H. ANDERSON
Senior White House advisor David Plouffe — President Obama’s campaign manager in 2008 — told Chris Wallace on Fox News Sunday that, when it comes to dealing with our colossal deficits and debt, “the right approach is the president’s approach.” That approach, Plouffe added, “gets our deficit on a very sustainable path.” One wonders: Has Plouffe seen a copy of the president’s budget?
2:22 PM, Nov 29, 2011 • By JEFFREY H. ANDERSON
Minnesota Public Radio reports, “A loophole in the federal health care overhaul would allow many employers to game the system by dumping their sicker employees [into] public health insurance exchanges, according to two University of Minnesota law professors.”