Inquiry sent to Alison Mitchell of the Congressional Research Service

We sent the following message to Alison Mitchell of the Congressional Research Service in an attempt to clarify the CBO’s language about the “costs” of employment-based insurance under CHIP reauthorization.

I’m a fact-checking journalist looking at claims made about the CHIP program renewal. I’ve run across your name more than once while trying to find information on the relationship between CHIP and “employment-based insurance,” hinting to me that contacting you directly might speed my progress toward answers to my questions.

One of CBO’s reports on CHIP makes a pair of apparently discrepant statements.

The report states:

Extending funding for CHIP for 10 years yields net savings to the federal
government because the federal costs of the alternatives to providing
coverage through CHIP (primarily Medicaid, subsidized coverage in the marketplaces, and employment-based insurance) are larger than the costs of
providing coverage through CHIP during that period.

The same report, however, includes a chart that lists revenue associated with “employment-based insurance,” and “employment-based insurance” is not listed with Medicaid and (ACA) marketplace alternatives in the part of the chart describing projected outlays.

The natural question seems to be: How does CHIP renewal result in revenue from “employment-based insurance”? Perhaps part of the answer occurs in a different CBO report linked from the one I quoted. It says people dropping from employment-based insurance end up receiving their employment benefits in taxable form instead of through tax-exempt medical benefits. That report credits that drop in employment-based insurance with a projected $4.4 billion in revenue.

That $4.4 billion falls considerably short of the $12.9 billion in revenue described in the other report, however. Moreover, the first report says about $4.2 billion of the $12.9 billion would occur off-budget.

How does one explain the apparent discrepancy? How does renewing CHIP produce $12.9 billion in revenue, with $4.2 billion of that off-budget?

Thanks for reading. I look forward to a clarification that will assist in educating the public on this important issue.

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