CBO: Repeal of individual mandate to reduce deficit by $338B

WASHINGTON (Reuters) - The Congressional Budget Office on Wednesday said that repealing the individual mandate for health insurance would reduce the federal budget deficit less than first forecast as it readied a revised analysis of a policy shift favored by Republicans.

The CBO, the nonpartisan budget-scoring agency, said in a statement on its website that eliminating the mandate in the Affordable Care Act, also often dubbed Obamacare, would lower the deficit by $338 billion over the next decade, not $416 billion, its previous estimate.

It will release a fuller revised analysis conducted with the congressional Joint Committee on Taxation later on Wednesday that will also estimate the impact on health insurance coverage and premiums.

"The agencies are in the process of revising their methods to estimate the repeal of the individual mandate," the CBO said, adding that work on updating the methodology was not yet complete.

The Obamacare mandate requiring Americans to buy health insurance has proved to be among the most controversial portions of the law.

Some Republicans want to include a repeal of the mandate in legislation to reform the tax code. The U.S. House of Representatives unveiled its tax plan last week, and the Senate's plan is expected to be released on Thursday.

(Reporting by Makini Brice; Editing by Susan Heavey and Jeffrey Benkoe)