Obamacare Subsidies Projected to More Than Double Over Next Decade

Spending on certain programs to increase from $42 billion to $97 billion

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Subsidies for health insurance purchased through the marketplaces established under the Affordable Care Act are projected to more than double over the next decade, according to a report from the Congressional Budget Office.

The report, which evaluated spending for various means-tested programs or programs that offer benefits to those who earn income under a certain threshold, found that spending on Obamacare subsidies will total $42 billion in 2017 and are estimated to more than double to $97 billion by 2027.

In fiscal year 2016, payments for subsidies totaled $31 billion and, according to the budget office, payments will grow rapidly in 2017 and 2018 largely due to the growth in enrollment.

Overall, the report found that total mandatory spending would grow at an average rate of 5.5 percent over the next 10 years, and the largest programs included in that spending are Medicaid, Supplemental Security Income, the earned income and child tax credits, and the food stamp program.

Spending on Medicaid grew primarily due to the expansion of coverage under Obamacare, rose by 32 percent from 2013 to 2015. It is projected to increase even further, costing $389 billion in 2017 and rising to $650 billion in 2027—an increase of 67 percent.

Outlays for the Supplemental Security Income are projected to rise by roughly 35 percent over the next decade, rising from $55 billion in 2017 to $74 billion in 2027.

While outlays for the earned income and child tax credits grew by nearly 40 percent from 2007 and 2008 during the recession, they are expected to only increase by an average of 2 percent per year between 2017 and 2027. In 2017, outlays for this program will cost roughly $80 billion and will increase to $94 billion over the next decade.

Finally, the Supplemental Nutrition Assistance Program, otherwise known as food stamps, will see a decline in spending over the next decade. While spending on food stamps roughly doubled between 2008 and 2011, around the time of the recession, the program is projected to decline from $71 billion in 2017 to $69 billion in 2027.

Overall, spending on all means-tested programs will increase from $745 billion in 2017 to $1.139 trillion, an increase of 53 percent.

The Department of Health and Human Services did not respond to requests for comment by press time.

Ali Meyer

Ali Meyer   Email Ali | Full Bio | RSS
Ali Meyer is a staff writer with the Washington Free Beacon covering economic issues that expose government waste, fraud, and abuse. Prior to the Free Beacon, she was a multimedia reporter with CNSNews.com where her work appeared on outlets such as Drudge Report and Fox News. She also interned with the Heritage Foundation and Pacific Research Institute. Her Twitter handle is @DJAliMeyer, and her email address is meyer@freebeacon.com.