Report: Obamacare cheaper than expected

The latest cost projections released by the Congressional Budget Office suggest that health insurance costs under the ACA may be cheaper than once expected.

On April 14, researchers at CBO revealed that the net cost of health insurance premiums under the ACA could be $109 billion less than previously anticipated. The 7 percent reduction in the projected cost could be an early indicator that the average American will be able to afford health care coverage under the ACA.

“It is good news that premiums have come in lower than expected, meaning lower costs for the federal government and for families as well,” Larry Levitt, senior vice president at the Kaiser Family Foundation, told New Republic. “It's a sign that the ACA may be working to hold premiums down by forcing insurers to compete over price rather than by cherry-picking healthy people.”

The CBO's latest projections are in stark contrast to earlier reported figures. According to the Associated Press, subsidies for health care coverage under the ACA are expected to cost an estimated $1 trillion over the next decade, rather than the $1.2 trillion that was suggested in February.

Lower costs for health insurance premiums on the federal and state-based health exchanges are a main reason behind the shift, according to CBO. Additionally, restrictions on in-network health providers, as well as lower payment rates for providers, could be driving factors, New Republic reported.