CBO: The Bipartisan Health Care Stabilization Act of 2017 and the Individual Mandate

November 29, 2017 – In October 2017, CBO and the staff of the Joint Committee on Taxation (JCT) published a cost estimate for the Bipartisan Health Care Stabilization Act of 2017 (BHCSA), and in November 2017 the agencies published an updated estimate for repealing the individual health insurance mandate.

On November 21, 2017, CBO was asked about the combined effects of simultaneously passing the BHCSA and legislation that would repeal the requirement that most U.S. citizens and noncitizens who lawfully reside in the country have health insurance meeting specified standards. Specifically, CBO was asked if legislation that combined the provisions would change the agencies’ previous estimates of the number of people with insurance coverage or premiums in the nongroup insurance market.

In the estimate for the BHCSA, the agencies wrote that, relative to the Summer 2017 baseline, the legislation would not substantially change the number of people with health insurance coverage, on net. Because CBO’s baseline incorporates the assumption that cost-sharing reductions (CSRs) will be fully funded, premiums would not change under the BHCSA relative to that baseline. In the estimate of repealing the individual health insurance mandate, the agencies wrote that repealing the mandate would result in a decrease of the number of people with health insurance of 4 million in 2019 and 13 million in 2027. In addition, the agencies estimated that average premiums in the nongroup market would increase by about 10 percent in most years of the decade (with no changes in the ages of people purchasing insurance accounted for), relative to CBO’s Summer 2017 baseline projections.

If legislation were enacted that incorporated both the provisions of the Bipartisan Health Care Stabilization Act and a repeal of the individual mandate, the agencies expect that the interactions among the provisions would be small; the effects on premiums and the number of people with health insurance coverage would be similar to those referenced above.