The Urban Institute recently examined the impact of a partial repeal of the Affordable Care Act (ACA) through the budget reconciliation process. Because no specific proposals for repealing the ACA are being considered, we analyzed the reconciliation bill passed by Congress and vetoed by President Obama in early 2016.
That bill would have eliminated Medicaid expansion, premium tax credits and cost-sharing reductions for Marketplace coverage, and the individual and employer mandates, but not the insurance market reforms, including guaranteed issue in the nongroup market and prohibiting preexisting condition exclusions. We also assumed the ACA would not be replaced.
Under reconciliation, the number of uninsured nationally would increase from 28.9 million to 58.7 million in 2019, an increase of 29.3 million, or 103 percent. Of the 29.8 million newly uninsured, 22.5 million would become uninsured because of eliminating the premium tax credits, the Medicaid expansion, and the individual mandate. An additional 7.3 million would become uninsured because of the near collapse of the nongroup insurance market.
Urban also released data on the impact of partial ACA repeal on individual states, including changes in coverage types, characteristics of people losing coverage, and changes in the number of uninsured children and parents. After seeing our findings, the office of Senator Robert Casey asked our team to dive deeper into the data from his home state of Pennsylvania. We agreed this would provide an excellent opportunity to use Pennsylvania as a case study to explore the ramifications of partial ACA repeal at the state level and below. We plan to produce similar estimates for other states in different regions.
To perform our analysis, we divided Pennsylvania into counties or groups of counties containing a minimum of 200,000 people. (The exception was Lackawanna and Wyoming Counties, which include Scranton, containing 190,000 people.) Our underlying data were obtained from the American Community Survey, which divides states into Public Use Microdata Areas (PUMAs) for which statistically valid estimates can be produced. We combined neighboring PUMAs to construct county groups with at least 200,000 people. This gave us 20 counties or county groups.
Under reconciliation, we project an increase of 956,000 in uninsured Pennsylvanians by 2019, or 135 percent. This increase is above the national average, in part reflecting the state’s decision to adopt Medicaid expansion. The increases range from a low of 103.2 percent in Cumberland, Dauphin, Lebanon, and Perry Counties to a high of 201.3 percent in Bucks County.
The largest increases in the uninsured occur in the two major urban areas, Allegheny County (Pittsburgh), which would see an increase of 89,000 uninsured, and Philadelphia County (Philadelphia), with an increase of 152,000 uninsured. About 74 percent of the uninsured would have been eligible for some coverage under the ACA, but only 13 percent of the larger number of uninsured under the reconciliation bill would be eligible.
We also examined the reductions in Medicaid and Children’s Health Insurance Program (CHIP) expenditures, as well as federal premium spending on federal tax credits and cost-sharing reductions. Between 2019 and 2028, Pennsylvania would lose $22.7 billion in federal Medicaid spending and $13.3 billion in federal spending on premium tax credits and cost-sharing reductions. This amounts to a $35.9 billion reduction in federal dollars between 2019 and 2028. The largest reductions in federal spending would occur in Philadelphia County ($7.5 billion) and in Alleghany County ($3.1 billion).
The increase in the number of uninsured in Pennsylvania will place significant pressure on local safety net providers or hospitals that provide care to a significant number of low-income and disadvantaged populations. Meanwhile, dramatic spending reductions will translate to less revenue for these providers.
As we continue to explore the ramifications of ACA repeal at the local level, you can explore our state-level findings to see how ACA repeal would affect your state.