"Repealing the [health-care law] will lead to an increase in budget deficits over the coming decade, though a smaller one than previously reported," budget office director Douglas Elmendorf said in a letter to House Speaker John A. Boehner (R., Ohio).
Tuesday's budget projections were the first since the Supreme Court upheld most of the law last month. The CBO said the law's mix of spending cuts and tax increases would more than offset new spending to cover uninsured people.
As expected, the budget office said the law would cover fewer uninsured people because the Supreme Court ruled that states won't have to sign on to a planned expansion of Medicaid for their low-income residents.
Thirty million uninsured people will be covered by 2022, or about three million fewer than projected this spring, the report said.
Standing their ground
As a result of that change, taxpayers will save about $84 billion from 2012 to 2022. That brings the total cost of expanding coverage down to $1.2 trillion, from about $1.3 trillion in the previous estimate.
Democrats immediately hailed the findings as vindication for the president. "This confirms what we've been saying all along: The Affordable Care Act saves lots of money," said Senate Majority Leader Harry Reid (D., Nev.).
Republicans said they remained unswervingly committed to repealing the law. When combined with other budget-cutting measures, GOP leaders say, repeal will ultimately reduce deficits. Romney says that if elected he would begin to dismantle the law on his first day in office.
Medicaid has been one big question hanging over the future of Obama's law since the Supreme Court ruled.
Some GOP-led states, such as Texas and Florida, say they will not go forward with the expansion. Others are uncommitted, awaiting the voters' verdict on Obama in November.
Although the federal government would bear all of the initial cost of that expansion, many states would have to open their Medicaid programs to low-income childless adults for the first time.
CBO analysts did not try to predict which specific states would jump in and which would turn down the Medicaid expansion. Instead, they assumed that many states would eventually cut deals with the federal government to expand their programs to some degree.
As a result, the budget office estimates more than 80 percent of the low-income uninsured people eligible under the law live in states that partially or fully expand their programs.