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Megan McArdle

Obamacare's Good News Only Tells Half the Story

We should be glad to learn that the CBO thinks we'll be spending less on subsidies. But we shouldn't put more weight on that statistic than it can actually bear.
Good news? Maybe.

Good news? Maybe.

Photographer: Matt McClain/The Washington Post via Getty Images

Is Obamacare costing less than we expected? I've seen notes to that effect on the Web and social media, thanks to newly released estimates from the Congressional Budget Office. However, that's something of a misreading of the CBO document, which only covers the cost of the insurance coverage provisions in Obamacare. Those are obviously a huge part of the law. But they're not the only part of the law, and we don't have a CBO estimate for the rest.

I imagine that by now you are thoroughly confused. But actually, it's fairly simple. The Affordable Care Act, aka Obamacare, included a number of (expensive) provisions intended to increase insurance coverage. It also had a number of tax increases and spending cuts intended to pay for the insurance expansion. The former minus the latter is the cost of the law -- though because that number was actually negative in the original score, indicating a small amount of deficit reduction, perhaps we should say the "benefit."