Repeal of health law would drive up deficit by $137 billion

Repealing the Affordable Care Act, as many congressional Republicans still pledge to do, would drive up the deficit by $137 billion over the next decade, according to a new report from the independent Congressional Budget Office, which for the first time employed an estimating method that Republicans have pushed for.

Repeal also would leave an additional 24 million people without health coverage by 2020, the report projects.

The analysis comes as GOP lawmakers are making plans to renew a repeal push if the Supreme Court backs the latest legal challenge to the 2010 law.

The budget office, which lawmakers rely on to provide estimates of the impact of proposed legislation, has long projected that repeal would drive up deficits.

Repealing the law would end the money the federal government spends to subsidize insurance for low- and middle-income consumers, but would also eliminate a variety of measures that offset those costs, including reductions in future Medicare spending and new taxes and fees.

Congressional Republicans, who recently replaced the director of the budget office, had hoped they would get more favorable estimates now because the office has started to use a controversial methodology known as dynamic scoring to project the cost of legislation.

Dynamic scoring takes into account not only the direct cost of legislation, but also tries to estimate the secondary impact that a law can have as a result of its impact on the economy.

The new estimate on the health law projects that the direct impact of repealing the health law would push up the deficit by $353 billion over the next decade.

But the elimination of insurance assistance would force more Americans to remain in the workforce, generating more taxes, the budget office projects. That makes the overall impact on the deficit lower, coming in at $137 billion, according to the budget office.

This methodology has come under criticism from many experts who say that these kinds of estimates are highly uncertain.

Republican leaders have been promising their members a vote on repealing the law. That would become more pressing if the Supreme Court rules in favor of the pending legal challenge, brought by conservative activists, which argues that insurance for low- and moderate-income consumers can be paid only in states that established their own insurance marketplaces through the law, rather than having the federal government operate the marketplace for them.

The marketplaces – which opened in 2013 and now cover some 10 million people -- allow Americans who don’t get health benefits at work to shop online among plans that must all offer basic benefits and cannot turn away customers, even if they are sick.

Consumers making less than four times the federal poverty level -- about $47,000 for a single adult and $97,000 for a family of four -- qualify for subsidies.

The Obama administration, the law’s congressional architects and many outside legal experts say the law was clearly intended to make the subsidies available everywhere in the country.

If the court backs the challengers, more than 6 million people in 34 states would likely lose subsidies, wreaking havoc in the states’ insurance markets.

GOP leaders have said they will consider restoring the aid, at least temporarily, in exchange for repeal of major parts of the law, including requirements that insurers cover basic benefits and consumers have health coverage or pay a penalty.

But Republicans say their ultimate goal is to roll back the whole law.

For more on the Affordable Care Act, follow @noamlevey.