A new voice has inserted itself into the Children's Health Insurance Program funding debate: the Congressional Budget Office.
The independent agency sent a letter Friday to Senate Finance Committee Chair Orrin Hatch (R-Utah) that estimates a five-year CHIP extension would cost the federal government $7.5 billion less than the CBO had previously estimated. The new estimate is $800 million.
Whether this sharp reduction in the program's price tag will change congressional gridlock over how to pay for CHIP remains to be seen.
The reason for the cut? The elimination starting in 2019 of the Affordable Care Act's individual mandate to buy insurance.
With fewer healthy people projected to enroll in the individual market, according to the CBO, premiums will rise. As premiums rise, the federal government will have to shell out more money in premium tax credits for subsidized enrollees.
States have prepared to move kids covered through CHIP to the individual market exchange plans. These kids would qualify for subsidies that would raise the amount of subsidies the government would have to pay. The agency also predicts more adults would enroll in family plans along with their kids, which would raise the cost of subsidies even more.