The total cost of all those receiving subsidized health insurance will exceed $600 billion this year, with the majority of the American public receiving subsidized health insurance being employed full time. Only a only a small number are obtaining subsidized insurance through an insurance exchange, and about the same number have no insurance this year.
That’s what a Congressional Budget Office (CBO) analysis of the American health insurance landscape says. The CBO report only considered those under age 65. It found the next largest group with insurance, and with subsidies, were the one-quarter of under-65 Americans enrolled in Medicaid or the Children’s Health Insurance Program.
“A smaller number will have non-group coverage that they purchase either through or outside one of the health insurance marketplaces … and about 27 million people under age 65 — 10 percent of that population — will be uninsured in 2016,” the report said.
Highlights of the report include the following:
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$268 billion, or about 40 percent of 2016, are the result of tax breaks for small employers and the exclusion for employer-based health insurance plans that cover 155 million workers under 65 years of age;
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$279 billion in subsidies are attributed to Medicaid and the federal Children’s Health Insurance Program;
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The Patient Protection and Affordable Care Act (PPACA) will account for $110 billion in subsidies;
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The total estimate for 2016 subsidies is $660 billion, or 3.6 percent of GDP;
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CBO estimates that number will increase 5.4 percent a year;
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By 2026, CBO estimates the cost of subsidies will be 1.1 trillion — or 4.1 percent of GDP;
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For the entire 2017–2026 period, the projected net subsidy is $8.9 trillion.
Going forward, CBO and its study partner, the Joint Committee on Taxation, are going to change how they break these numbers out.
“Although CBO and JCT have included in this report estimates that separately identify the effects of the ACA’s insurance coverage provisions on the federal budget, generating such estimates is becoming more difficult and less meaningful,” the report says.
“As a result, CBO and JCT will no longer make separate projections of all of the incremental effects of the ACA’s insurance coverage provisions; instead, they will present their projections of overall insurance coverage levels and related subsidies, taxes, and penalties under current law. In future years, the agencies will update and publish those broader estimates annually.”
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Dan Cook
Dan Cook is a journalist and communications consultant based in Portland, OR. During his journalism career he has been a reporter and editor for a variety of media companies, including American Lawyer Media, BusinessWeek, Newhouse Newspapers, Knight-Ridder, Time Inc., and Reuters. He specializes in health care and insurance related coverage for BenefitsPRO.
