Health reform will cost less than was predicted last year but will cover fewer people, the Congressional Budget Office said Tuesday.
CBO predicts the law will reduce the number of Americans without health coverage by 30 million, 2 million fewer people than last year. That would leave about 27 million people uninsured in 2016, two years after the law’s insurance exchanges go online.
Additionally, 4 million Americans can expect to lose their employer-sponsored health care by 2016, a significant jump from the 1 million people estimated last year.
But with that news, the CBO also cut the cost estimate for the reform law. They estimate the insurance coverage provisions of the PPACA will have a net cost of just under $1.1 trillion over the 2012-2021 period—almost $50 billion less than the agencies’ March 2011 estimate for that 10-year period.
It is now projected to spend $1.083 trillion between 2012 and 2021. Last year, CBO’s estimate was $1.131 trillion.
The decrease is due to a combination of factors—including lower estimates for subsidies and tax credits associated with the law's insurance exchanges.
But those losing employer-sponsored care will cause more people to enroll in Medicaid, which will increase costs.