CBO’s Analysis of Senate Health Bill on Premiums

In response to a request from Senator Evan Bayh the Congressional Budget Office has provided an analysis as to how the Patient Protection and Affordable Care Act might impact future premium costs.

Document Excerpt

 

Summary of Findings The effects of the proposal on premiums would differ across insurance markets (see Table 1). The largest effects would be seen in the nongroup market, which would grow in size under the proposal but would still account for only 17 percent of the overall insurance market in 2016. The effects on premiums would be much smaller in the small group and large group markets, which would make up 13 percent and 70 percent of the total insurance market, respectively. Nongroup Policies CBO and JCT estimate that the average premium per person covered (including dependents) for new nongroup policies would be about 10 percent to 13 percent higher in 2016 than the average premium for nongroup coverage in that same year under current law. About half of those enrollees would receive government subsidies that would reduce their costs well below the premiums that would be charged for such policies under current law.

 

Link http://www.cbo.gov/ftpdocs/107xx/doc10781/11-30-Premiums.pdf

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