New CBO Report Lowers Its Projection For ACA Implementation Cost

Once again, the Congressional Budget Office (CBO) has lowered its projection for the cost of implementing the Affordable Care Act (ACA). In a new report, the CBO estimates the cost of health insurance subsidies, Medicaid and Children’s Health Insurance Program (CHIP) outlays and small-employer tax credits at $648 billion for 2015 to 2019. However, once the number is subtracted from the $142 billion in payments to the government due to the individual mandate, employer mandate, and Cadillac tax, the cost of ACA implementation over the same time period comes to $506 billion – a 30 percent drop from the CBO’s initial projection of $710 billion.

The report cites three key factors for the lower estimate:

  • Private insurers selling policies in the state and federal insurance exchanges that are charging lower premiums than expected.
  • A projected decrease of 2 million in the expected number of Medicaid and CHIP enrollees by 2025.
  • The historic low rate of healthcare spending growth.

Click here to see the report.

Click here to read more.

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