Policies purchased through the exchanges (or directly from insurers) would have to meet several requirements: In particular, insurers would have to accept all applicants, could not limit coverage for preexisting medical conditions, and could not vary premiums to reflect differences in enrollees' health.

By 2019, CBO and JCT estimate, the number of nonelderly people who are uninsured would be reduced by about 31 million, leaving about 23 million nonelderly residents uninsured (about one-third of whom would be unauthorized immigrants).

o Substantially reduce the growth of Medicare's payment rates for most services.
o deleting provisions that would increase payment rates for physicians under Medicare

Page 5 CHANGES IN DIRECT SPENDING (OUTLAYS) - non Medicare Advantage Reductions.

Reductions in Annual Updates to Medicare FFS (Fees For Service) Payment Rates  $186 billion - 2010 - 2019

Medicare and Medicaid DSH(1) (Medicare Disproportionate Share) Payments $43 billion - 2010 -2019

(1)Many Medicare beneficiaries and other patients rely on hospitals for their care, especially teaching hospitals that serve large low-income populations. These hospitals often face substantial financial pressure: they may provide significant amounts of care to the poor and lack the surplus revenue needed to underwrite the costs associated with the provision of services.

Maintaining access to hospital care has been an important objective of the Medicare program. As the program transitioned from cost-based reimbursement to a prospective system, Medicare added a special payment adjustment to its prospective payment system (PPS) for hospitals that serve large populations of low-income patients.
Purpose of the DSH Payment

The original rationale for the Medicare Disproportionate Share (DSH) payment adjustment was to compensate hospitals for the higher operating costs they incur in treating a large share of low-income patients. Low-income Medicare patients tend to be sicker and more costly to treat than other Medicare patients with the same diagnosis. Higher costs also result from the need for additional staffing and services, such as translators and social workers, to care for low-income patients.

Over time, however, a second justification for the DSH adjustment emerged. Many policy makers now view the purpose of DSH payments more broadly. Most agree that DSH funds preserve access to care for Medicare and low-income populations by financially assisting the hospitals they use. link

Undefined Other Reductions $91 billion - 2010 - 2019

Other Changes in Direct Spending

Community Living Assistance Services and Supports  
$72 billion - 2010 - 2019

CBO and JCT have determined that the legislation contains several intergovernmental and private-sector mandates as defined in the Unfunded Mandates Reform Act (UMRA). The total cost of those mandates to state, local, and tribal governments and the private sector would greatly exceed the thresholds established in UMRA ($69 million and $139 million, respectively, in 2009, adjusted annually for inflation).

Based on the longer-term extrapolation, CBO expects that inflation-adjusted Medicare spending per beneficiary would increase at an average annual rate of less than 2 percent during the next two decades under the legislation--about half of the roughly 4 percent annual growth rate of the past two decades. It is unclear whether such a reduction in the growth rate could be achieved, and if so, whether it would be accomplished through greater efficiencies in the delivery of health care or would reduce access to care or diminish the quality of care.

CBO