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1 Repealing the Individual Health Insurance Mandate: An Updated Estimate 1 (2017)

handle is hein.congrec/repvhim3894 and id is 1 raw text is: ; ..... NOVEMBER 2017 Repealing the Individual Health Insurance Mandate: An Updated Estimate The Affordable Care Act (ACA) includes a provision, generally called the individual mandate, that requires most U.S. citizens and noncitizens who lawfully reside in the country to have health insurance meeting specified standards and that imposes penalties on those with- out an exemption who do not comply. In response to interest from Members of Congress, the Congressional Budget Office and the staff of the Joint Committee on Taxation (JCT) have updated their estimate of the effects of repealing that mandate. As part of repealing the mandate, the policy analyzed would eliminate the penalty that people who have no health insurance and who are not exempt from the mandate must pay under current law. The analysis underlying this estimate incorporates revised projections-of enrollment in health insurance, premi- ums, and other factors-made as part of the usual pro- cess CBO follows to update its baseline projections. This report updates a budget option published in December 2016 and is not based on specific legislative language.1 The Results of CBO andJCT's Analysis CBO and JCT estimate that repealing that mandate starting in 2019-and making no other changes to cur- rent law-would have the following effects: 0 Federal budget deficits would be reduced by about $338 billion between 2018 and 2027 (see Table 1). 0 The number of people with health insurance would decrease by 4 million in 2019 and 13 million in 2027 (see Table 2). 1. See Congressional Budget Office, Options for Reducing the Deficit: 2017 to 2026 (December 2016), www.cbo.gov/ publication/52142. Nongroup insurance markets would continue to be stable in almost all areas of the country throughout the coming decade. Average premiums in the nongroup market would increase by about 10 percent in most years of the decade (with no changes in the ages of people purchasing insurance accounted for) relative to CBO's baseline projections. Those effects would occur mainly because healthier peo- ple would be less likely to obtain insurance and because, especially in the nongroup market, the resulting increases in premiums would cause more people to not purchase insurance. If the individual mandate penalty was eliminated but the mandate itself was not repealed, the results would be very similar to those presented in this report. In CBO and JCT's estimation, with no penalty at all, only a small number of people who enroll in insurance because of the mandate under current law would continue to do so solely because of a willingness to comply with the law. If eliminating the mandate was accompanied by changes to tax rates or premium tax credits or by other significant changes, then the policy analyzed here would interact with those changes and have different effects. For this analysis, CBO and JCT have measured the budgetary effects relative to CBO's summer 2017 base- line, which underlies the Concurrent Resolution on the Budget for Fiscal Year 2018.2 In that baseline, the ACA's other provisions, including premium tax credits and 2. See Congressional Budget Office, An Update to the Budget and Economic Outlook: 2017 to 2027 (June 2017), www.cbo.gov/ publication/52801. For additional information about the baseline presented in that report, see Federal Subsidies for Health Insurance Coverage for People Under Age 65:2017 to 2027 (September 2017), www.cbo.gov/publication/53091.

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