Today, Obamacare provides tax credits to lower- and middle-income families in order to make coverage more affordable. The House bill provides tax credits, too, but they would be much less generous for many households, because they’re based on age rather than income. Because the CBO only tried to forecast premiums before tax credits in its analysis, it didn’t actually tell us whether families would be paying more or less on average for their insurance.
Turns out they will be paying more. The Office of the Actuary at the Centers for Medicare and Medicaid Services released its own score of the House bill. It finds that gross premiums—that is, before tax credits kick in—would fall 13 percent by 2026. However net premiums—that is, after tax credits—would rise 5 percent, because the law’s subsidies would simply be worth less. What’s more, average out-of-pocket costs like deductibles and co-pays would skyrocket 61 percent, in large part because the law ends the Obamacare rules that limit those expenses for poorer families. Overall, people will simply be paying more for their coverage and care ($162 a month more, on average, to be precise).
These are also only average effects. In the end, the House bill will mean different things for different Americans. Premiums before subsidies will go down for younger, healthy customers and way up for people in their sixties, because the AHCA increases the amount insurers can charge older enrollees compared to people in their twenties. If states waive the Essential Health Benefits rules, people who need more services (like women who want childbirth coverage) will pay a lot more for them. Some upper-middle-class households that were never eligible for Obamacare’s subsidies could come out ahead, meanwhile, because they would qualify for the House bill’s tax credits.