- Republicans repealed Obamacare’s individual mandate in their tax reform law, which President Donald Trump said was effectively a repeal of Obamacare.
- A new Congressional Budget Office report shows that fewer people will leave the Obamacare market due to the mandate repeal than previously thought.
- Part of the reason, the CBO said, was because people value health coverage more than before Obamacare was passed.
Even after sustaining a major blow from Republicans, Americans may not ditch Obamacare as quickly as previously thought.
The new GOP tax reform law contained a provision that virtually eliminated Obamacare’s individual mandate, which requires all Americans to purchase health coverage or face a penalty. After Congress passed the tax law, Trump claimed that getting rid of the mandate amounted to a “repeal” of the landmark healthcare law.
Trump’s language was a bit strong – the mandate is only one element of Obamacare – but the Congressional Budget Office estimated in November that 13 million more Americans would end up uninsured by 2027 than under the current baseline.
Six months later, a CBO update found that the mandate repeal would only cause about 5 million more people to go uninsured in that timeframe. There are several reasons for the adjustment, including insurance market changes and methodology tweaks.
While those changes were more technical in nature, the CBO also mentioned an interesting shift that helped cause the drop: people like having health insurance.
“The mandate has been in place for an additional year (five years in total), and people’s expectations about whether one should have coverage are more established and, in CBO’s current judgment, less sensitive to repealing the legal mandate,” the report said.
Put another way, Obamacare prompted millions of American to get health coverage for the first time – and a good portion don’t want to give up what they have bought.
Recent polling also appears to confirm that many Americans plan to stick with their coverage despite the mandate repeal.
The Kaiser Family Foundation, a nonpartisan health policy think tank, found in a March poll that 90% of people currently enrolled in a plan purchased on the Obamacare marketplace planned to keep their coverage even when the penalty disappears in 2019. Just 7% of people who had these plans told Kaiser they planned to drop the coverage.
The Kaiser also poll found that most people didn’t consider the mandate to be a big reason for their insurance purchase. Just 34% of those surveyed said the law’s requirement to buy coverage was a “major reason” they decided to sign up.
This could, of course, change over time based on factors like the cost of coverage.
In the report, the CBO also estimated that premiums on the Obamacare individual insurance market would increase by 15% in 2019 and 7% each year afterward through 2027.
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