The Congressional Budget Office has released its latest estimates for the financial cost should Congress repeal the Affordable Care Act—and it wasn’t what many Republicans were hoping for.
Repealing Obamacare would add as much as $353 billion to the U.S. Budget deficit through 2025, the non-partisan CBO found. When taking into account the economic effects of future policy changes — what’s called “dynamic scoring” — the deficit inflation would be closer to $137 billion.
That’s a pretty big sum, especially given that a CBO review in 2012 estimated that rescinding the law would add about $109 billion to the deficit over a decade.
While getting rid of the law would generate savings by ending insurance subsidies to millions of Americans, those savings would be surpassed by reversing the law’s cuts to Medicare and scrapping its various tax tax increases, the CBO said. It would also increase the ranks of the uninsured by 19 million next year.
Despite the ballooning deficit, repealing the act would help boost economic activity by 0.7% over the 2021-2025 time period. The gains would primarily be a result of more workers entering the labor force, according to the CBO analysis. That fits in with past analyses from the agency that predicted many workers would leave the labor market if they didn’t have to rely on an employer for insurance benefits.
The new report comes as lawmakers, citizens and industry players await a decision from the Supreme Court on whether or not the ACA’s insurance subsidies are legal. If the subsidies are struck down, it could unravel many of Obamacare’s central tenets and possibly even lead to a “death spiral” of rising insurance costs for many people.
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