Friday, May 26, 2017


The world is coming to an end! According to CBO (cough, cough) by 2026, 23 million people will lose insurance as Obamacare is "dismantled". This is the headline reverberating through the MSM echo chamber.

The reality is something very different than what is being portrayed. Here are four reasons why the CBO score is flawed.

Baseline Data

Under CBO rules the only way to determine the impact of a new law is to compare it to the data presented under current law. The baseline that was used in calculating the impact of AHCA was from 2016. At that time CBO projected that this year there would be 15 million people enrolled in exchanges. Actual plan election - not paid enrollment - for 2017 was 12.2 million. History shows that 10% never pay a premium giving a conservative true paid enrollment at 11 million.

What this means for the AHCA score is that CBO is assuming 4 million more people starting out with insurance than the actual number.

Medicaid Expansion Assumption

Another significant figure is the number of people who will lose Medicaid. There are 31 states plus DC who have expanded Medicaid. Without a doubt killing the expansion over the course of a few years will decrease the number of people eligible in these states. But, with no changes to Medicaid funding prior to 2020 why would any state that has expanded coverage elect to kill the program early? I highly doubt any of them will.

Using the logic that no state will turn away the Federal matching funds for their expansion, the question becomes why does the AHCA have 6 million people dropped from the Medicaid rolls before 2020? The answer is, AHCA's CBO score includes the potential enrollment from the 19 states that "could" expand their Medicaid rules.

Defining Insurance

Under Obamacare the definition of good insurance is set by the government. CBO, in it's infinite wisdom, thinks that they know what good insurance is too. So much so that they have set their own parameters in the scoring. In their estimation "a few million people" would buy policies that don't meet their definition of having "sufficient financial protection". Never mind that it might be what the consumer wants.

While CBO doesn't actually define what constitutes insurance in the score, they insinuate that some states will cut or reduce the number of essential health benefits and cause out-of-pocket limits to rise. Suffice it to say it's amazing that they can't give us this definition yet count a few million people as uninsured because of this definition.

Who Doesn't Want It

Finally, the CBO score doesn't tell us who doesn't want to buy insurance. Without a mandate any number of people might simply say no thanks. These people aren't losing insurance, they simply don't want it.

Does it Matter?

Take the 4 million baseline error plus 6 million Medicaid error plus a few million with "bad insurance" and add in an unknown amount who don't want insurance and the CBO scoring model just doesn't add up. The echo chamber will say it does and many will fall in line with the narrative. But, reality is this CBO score doesn't matter.

At the end of all the political gamesmanship and shouting matches AHCA will not pass. Not because of a fictitious number people losing insurance. Not because of pre-existing conditions. Not because of funding cuts. Definitely not because Obamacare is working.

It will fail because just like Obamacare it focuses on the effect and not the cause.

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