the Congressional Budget Office (together with the Joint Committee on Taxation) provided Congress on November 30, 2009, an analysis of the impact of the legislation on premiums that assumed that premium tax credits would be available in all states, making no distinction between federal and state exchanges. Over the next few days, this analysis was discussed by Republican Senators Grassley (155 Cong. Rec. S12107, 12/2/09), Enzi (155 Cong. Rec. S12378, 12/4/09), and Coburn (155 Cong. Rec. S13687). None raised what Cannon and Adler see as an obvious point, that the CBO analysis was flawed because it failed to recognize that premium tax credits would not be available though federally facilitated (sec. 1321) exchanges.
In fact, the CBO repeatedly provided cost estimates of the ACA and HCERA in late 2009 and early 2010, but never suggested that premium tax credits might be reduced if states failed to establish exchanges. As Professor Abbe Gluck notes in a recent blog post (and forthcoming article), Senators often don’t listen to each other, but they all listen to the CBO, which assumed that premium tax credits would be available to all Americans in all states.