10.04.18

Senate Budget Committee Republicans Press CBO on New Health Insurance Model

WASHINGTON D.C. – As part of the Senate Budget Committee’s ongoing oversight of the Congressional Budget Office (CBO), Republican members of the Committee sent a letter to the agency encouraging it to release details of its new health insurance simulation model (HISIM) to the public prior to its use next spring.  The members also asked CBO to consider re-estimating federal spending and coverage under the Affordable Care Act using the new health care model to determine whether the agency’s estimates would have been closer to the actual, observed amounts since its enactment.

Led by Budget Chairman Mike Enzi (R-WY), Senators Chuck Grassley (R-IA), Mike Crapo (R-ID), Lindsey Graham (R-SC), Pat Toomey (R-PA), Ron Johnson (R-WI), Bob Corker (R-TN), David Perdue (R-GA), Cory Gardner (R-CO), John Kennedy (R-LA), John Boozman (R-AR), and Tom Cotton (R-AR) also signed the letter. CBO’s current health insurance simulation model was originally developed in the mid-2000s. While CBO has made some minor modifications to the model since its introduction, it has now embarked on a major effort to replace the model entirely to reflect the most current date and information.

In their letter to CBO Director Keith Hall, the senators wrote, “We strongly encourage CBO to release details of its new model to the public prior to its use next spring. This would allow for a more extensive peer-review process before its adoption, which is consistent with your goal of fostering greater transparency of the agency’s models and its work.”

To ensure that it is thoroughly tested and validated, the senators also requested that CBO publish detailed information about the new model’s specifications, including the specific data it relies on, a description of the estimation methods, and a full explanation of key assumptions within the model before it is adopted. In addition to soliciting feedback from the agency’s technical review panel, the senators recommended CBO establish a process for broader external validation of the new model by the public prior to putting it into use next spring.  

“We believe CBO should consider re-estimating federal spending and coverage under the Affordable Care Act using HISIM2 to determine whether the agency’s estimates would have been closer to the actual, observed amounts since its enactment. This type of real-world testing not only could serve to validate the model but would help further the goal of developing a new model that is capable of producing more accurate estimates for Members of Congress and the public,” wrote the senators. 

Read the full letter here.

Read CBO's response here.

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