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CBO – updated projections of the budgetary effects of the coverage provisions of the ACA

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Estimates for the Insurance Coverage Provisions of the Affordable Care Act Updated for the Recent Supreme Court Decision, July 24, 2012

  • “CBO and JCT now estimate that the insurance coverage provisions of the ACA will have a net cost of $1,168 billion over the 2012–2022 period — compared with $1,252 billion projected in March 2012 for that 11-year period—for a net reduction of $84 billion. (Those figures do not include the budgetary impact of other provisions of the ACA, which in the aggregate reduce budget deficits.) The projected net savings to the federal government resulting from the Supreme Court’s decision arise because the reductions in spending from lower Medicaid enrollment are expected to more than offset the increase in costs from greater participation in the exchanges. That outcome is projected to occur despite the fact that the government’s average additional costs per person in the exchanges will be greater than its average savings per person for those who, as a result of the Court’s ruling, will not enroll in Medicaid. Why? Because the number of additional people entering the exchanges as a result of the ruling is projected to be only about half the number who will not be obtaining Medicaid coverage, many of whom will be ineligible to participate in the exchanges.”
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