The CBO says the newest Republican healthcare bill would leave 'millions' more without health insurance

• Bob Bryan
 

• 17h
• 6,086
 

Sen. Bill Cassidy coauthored the healthcare bill that got a score from the Congressional Budget Office on Monday. Jonathan Bachman/Reuters

The latest attempt by Republicans in the Senate to repeal and replace the Affordable Care Act will leave "millions" of Americans without insurance, the Congressional Budget Office said.

The nonpartisan agency stopped short of putting a more specific number on its assessment, however, as it has in the past, saying it needs more time to do that.

The score for the plan, known as the Graham-Cassidy bill, is limited in scope because of the short time frame in which the CBO had to produce it and includes only the budgetary effects of the bill.

The office projected that the Graham-Cassidy bill would reduce the federal deficit through 2026 by more than the $133 billion in savings from the House's American Health Care Act. That ruling allows Republicans to bypass a Democratic filibuster.

The bill is required to save as much as or more than the House bill to qualify under the procedure known as budget reconciliation, which allows Republicans to pass it with a simple majority.

Monday's CBO score provided only a vague assessment of the insurance-coverage impacts of the bill.

"The number of people with comprehensive health insurance that covers high-cost medical events would be reduced by millions compared with the baseline projections for each year during the decade, CBO and JCT estimate," the CBO's report said. "That number could vary widely depending on how states implemented the legislation, although the direction of the effect is clear."

Additionally, contrary to the assertions by the bill's authors, the CBO found that protections for people with preexisting conditions would be weakened by the new bill.

"Nevertheless, with the modifications, coverage for people with preexisting conditions would be much more expensive in some of those states than under current law," the report said.

The CBO said it would need "at least several weeks" to produce a more comprehensive score of the bill.

18 Million

Independent analyses by the Brookings Institution and the Commonwealth Fund estimated that the bill would result in up to 18 million more uninsured through 2019 and 21 million more uninsured through 2026 from the current baseline if signed into law.

Additionally, since the Graham-Cassidy bill would shift federal healthcare funding in 2020 to block grants (lump sums paid up front every year based on the number of people enrolled in certain programs), it would require states to develop and implement an entirely new health system in just two years. Such a short time frame, experts say, could cause chaos in health-insurance markets.

Because of these analyses, combined with the massive amounts of federal assistance cut in the bill, GOP leaders have not been encouraged about the legislation's prospects. Two GOP members — Rand Paul and John McCain — have formally announced their intentions to vote against the bill. Several others from across the conference have also expressed misgivings.

Only two Republican senators can vote against the bill for it to pass.

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Steve Cohen just took a big step forward in his comeback with a massive new hedge fund

• Rachael Levy
 

• Sep. 23, 2017, 9:39 AM
• 13,251
 

Steve Cohen. Point72

NEW YORK – Steve Cohen, the billionaire hedge-fund manager briefly banned from the industry after an insider-trading investigation, this week sent investors documents pitching his new fund, Stamford Harbor Capital, a person who has reviewed the deck told Business Insider.

The pitch is the latest move cementing the controversial billionaire's return to managing money.

Investors will have to agree to steep terms to put their money with the famed investor — including a minimum investment of $100 million and an annual management fee of over 2.5% of those assets — this person said, asking not to be identified discussing private information.

Jonathan Gasthalter, a spokesman for Cohen, declined to comment for this story.

Cohen's new fund is arguably one of Wall Street's most anticipated new launches. Bloomberg News reported earlier this month that he could raise between $2 billion and $10 billion. At the high end, it would be the largest hedge-fund launch in history.

'Wink wink, nudge nudge'

Until now, though, investors, advisors, and others in the hedge-fund industry said Cohen's representatives had limited themselves to vague and almost bizarrely hypothetical conversations about the fund along the lines of: If a particular person named Steve Cohen happens to launch a fund, and that fund happens to open next year, what would it take for an investor to sign on?

"It was a lot of wink wink, nudge nudge," said one person, who spoke of meetings before the documents were sent this week. As Bloomberg News reported earlier this month, the official line, meanwhile, was that Cohen was undecided about his plans.

Cohen has been running a family office called Point72, with some $11 billion in assets, since 2014 after he agreed not to manage other people's money and return outside investors' capital. The agreement came after a years-long insider trading investigation at Cohen's SAC Capital that ended with a conviction for one of Cohen's subordinates but not him. His failure, according to the SEC, was to supervise those traders as head of SAC Capital. SAC also pleaded guilty and paid a record fine, $1.2 billion, to settle insider-trading claims.

The ban will be lifted in January 2018.

Now, in anticipation of this, Cohen's marketing is being led by a man named Doug Blagdon at an advisory firm called ShoreBridge Capital who previously led the marketing effort at SAC Capital. Blagdon didn't immediately respond to requests for comment.

Wealthy investors, funds of hedge funds and sovereign wealth funds are the most likely investors in Cohen's new fund, people in the industry say. Public pensions, endowments, and foundations that have become major backers of the hedge fund industry are likely to stay out because they face greater public scrutiny and may find it difficult to explain an investment with a manager who — though he generated huge profits — was tarred by an association with a huge insider trading scandal.

Cohen is also said to have lined up firms to handle the back-end of a hedge fund's operations — the prime brokers who would manage settlement of trades and other basic functions as well as the "cap intro" teams at big banks who serve as gatekeepers to investors. Still, the pitch to investors is not yet widespread, and may never be. Many investors who are usually briefed on hedge fund launches say they have yet to hear anything. 

Privately, Cohen has expressed doubts about whether he should come out again, a potential investor who also knows Cohen personally said. Cohen's family office hasn't recently posted the kind of 30% annual returns that he was once famous for.

"I suspect the real question is whether Cohen can still achieve outsized alpha," said Chris Cutler, a consultant, using a hedge-fund term for outperformance. "If even he can't, what is the fate for other long/short-focused managers?  I think Cohen will have a willing and ready list of LPs ready to invest with him. He doesn't need to worry about which LPs won't invest with him."

Staffers at Point72, which has been investing Cohen's billions since SAC got shut down, have been largely kept in the dark. They were unsure until recently whether Cohen would open up again. Those who know Cohen personally say the same.

Staffers said they hoped that Cohen would raise outside money – it would show a sense of permanency for their jobs and would make it less likely that Cohen would shut the operation down voluntarily, a person familiar said. Creating a hedge fund would also spread the cost of employees and support staff among other investors — as Point72 is currently managing Cohen's own money and that of some employees.

The hefty demands being made of investors — the minimum investment and fees — are a luxury only afforded to the most superstar investors. Cohen is one, famed for his consistent double-digit returns before he was rocked by the insider-trading investigation.

He has an army of admirers, often those who were made rich by him, either by working for him directly or by investing with him. Many think he has never done anything wrong, and that he's the greatest investor of all time.

Blatant 'no'

But he's also a polarizing figure because of the legal issues.

For at least two investors Blagdon has reached out to, and other potential investors who have yet to hear from him, the answer is a blatant "no."

No matter that the past several years, Cohen has tried to clean up his image. He hired former Department of Justice staffers and McKinsey consultants, and started a training program for young college grads – something Business Insider was invited to tour.

To show how compliant he was, he even put a ban on hiring from Visium, an $8 billion-dollar fund that shut down amid one of the most recent insider-trading scandals, before the public knew that Visium was even under investigation.

Still, it would be "willful ignorance" to think Cohen didn't have some hand in the trading, or at least know about it, one person in the industry said.

Investors who worry about this won't be investing.

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