Congressional auditors say the Obama administration’s decision to delay a key mandate in the new health care law will raise the cost of the law slightly, by $12 billion, over the next 10 years.
House Budget Committee Chairman Paul Ryan, Wisconsin Republican, asked the Congressional Budget Office to estimate the Affordable Care Act’s cost after the White House decided July 2 to delay by one year, to 2015, the law’s employer mandate requiring firms of 50 or more full-time workers to provide health coverage or pay fines.
Republican opponents of the law seized on the delay as an admission that “Obamacare” is fundamentally flawed.
The CBO said the cost will rise from $1.363 trillion in 2014-2023 to $1.375 trillion.
The government will see a $10 billion reduction in revenue, because employers who would have paid penalties for flouting the mandate in 2015 have received a reprieve, auditors said.
They also found the cost of subsidies on the health care law’s insurance markets, where those without employer-based coverage buy coverage with government assistance, will rise by $3 billion due to employees who enroll in the state exchanges because the mandate on their employers has been delayed.
A small change in taxable compensation — the result of fewer people enrolling in employer-based coverage — “will offset those increases by about $1 billion,” according to the auditors.
They also found that a delay in income-reporting procedures of enrollees on state-run exchanges — a hands-off approach that caused Republicans to warn of fraud — will have a minimal impact in the number of people who enroll in the markets “because the Internal Revenue Service will be able to identify misreporting when it compares reported income with tax returns at year-end.”