April 14 (Bloomberg) — The health law will cost $104 billion less over the next decade, the Congressional Budget Office said after premiums for private Patient Protection and Affordable Care Act (PPACA) plans came in lower than the agency expected.
The premium for a benchmark “silver” level plan, the second-most generous available, will average $4,400 in 2016, the CBO said today in a report – 15 percent less than it forecast in 2009. The budget office reports regularly on the economic effects of the law.
About 6 million people on average are expected to be enrolled in 2014 in private health plans through insurance exchanges created by the Patient Protection and Affordable Care Act, the budget agency said. The U.S. health secretary, Kathleen Sebelius, said last week that 7.5 million people signed up for private plans with enrollment set to end tomorrow.
White House press secretary Jay Carney called the CBO report “welcome news.”
“It shows that marketplace health-care costs have gone down, because premium estimates have gone down,” he told reporters in a briefing.
Sebelius’s enrollment figure exceeded an initial CBO estimate of 7 million made before the exchanges opened Oct. 1 and technology failures prevented millions from immediately signing up. In February, the agency revised its estimate to 6 million.
The estimate “cannot be compared directly with the number of people who have enrolled through the exchanges as of any given date,” according to the CBO report. “The number of people who will have coverage through the exchanges in 2014 will not be known precisely until after the year has ended.”
President Barack Obama on April 11 credited Sebelius with the turn-around when he announced his nominee to replace her, White House budget director Sylvia Mathews Burwell.
The CBO’s latest estimate is for all of 2014 and includes people who are able to sign up or leave coverage after April 15 because of life-changing events such as marriage or losing a job. The agency said that 7 million would also join Medicaid, the government program for low-income people that is being expanded in 26 states, a decrease of 1 million since February.