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This is a pretty big deal. The Senate Finance Committee has all along touted their version of health care reform as the only deficit-neutral bill that keeps under President Obama’s benchmark of $900 billion dollars over 10 years. It turns out that the latest CBO analysis of the merged bills coming out of the House of Representatives actually cost around $900 billion or less, and cover more Americans than the SFC bill – and that’s WITH a public option.
Congressional budget analysts have given House leaders cost estimates for two competing versions of their plan to overhaul the health-care system, concluding that one comes within striking distance of the $900 billion limit set by President Obama and the other falls below it.
House leaders have been working to lower the cost of the $1.2 trillion health-care package they offered in July. The report from the Congressional Budget Office, a copy of which was obtained by The Washington Post, puts the cost of one plan at $859 billion over the next decade and the other at $905 billion.
To fit within the window, the House bill lowered the subsidies offered to those who can’t afford insurance, which is not great. But it does include a public option, which CBO has said would save money to the federal budget in the long run.
The House bill expands Medicaid more than the Senate Finance bill, putting a greater burden on the states to pick up some of the tab. But as Scarecrow explained today, the SFC bill only fixed the scheduled lowering of doctor payments for Medicare for one year, artificially improving its effect on the overall budget.
Until the full analysis comes out, it is unclear whether these proposals would include the tweak to rural hospital reimbursement that Nancy Pelosi included to get Blue Dog support for a public option with Medicare + 5% rates. But the Speaker is continuing to whip House members on the public option to determine which version, one with Medicare rates or negotiated rates, can gather majority support. And she has warned that, without a public option, her chamber would have trouble including an individual mandate that would essentially force people to buy private insurance.
The Senate Finance Committee’s talking point that only their bill fits the contours of the President’s outline takes a hit with the release of the House CBO score, which covers more people while staying within the budget confines – all with a public option. The rationales for public option detractors are getting narrower and narrower.
UPDATE: Howard Dean commented on this new CBO score today: “What’s going on in the House is much better than what’s going on in the Senate… Pelosi is doing a terrific job in the House.”
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Important score result – thanks!
Cool!
dday, if these cbo reports have been done as previous ones this year (unlike earlier health care bill cbo analyses) these are fed budget costs only — and NOT total national healthcare expenditures which includes the costs that really matter: costs to households, state and local gov, employers.
it really doesn’t say much about a healthcare reform bill if the fed budget costs are controlled but costs go up in the private sectors and/or state and local govs. these are sectors that can’t run a deficit.
so, i have a request. if i’m right about the cbo analysis, would you please change the post title from “Costs” to “Fed Budget Costs” (or something similar) to avoid the confusion these cbo reports bring?
thanks!
In the future I will make that a bit more clear. In the body of the post, I did mention that the subsidies have been curtailed in this revised House bill, which would cost more. However, expanding Medicaid would probably lower costs significantly for low-income consumers. So it depends on the individual, but it’s hard to say with just the top-line numbers.
expanding medicaid might also add to the state costs (and many state budgets are in trouble). it’s not that i expect you to have all the answers to these other costs, that isn’t possible with these incomplete/bogus cbo reports.
it’s enough if you make clear which costs you are (and are not) talking about. that is all i’m asking. there’s a ton of confusion about this issue, which i actually think must be intended as the analysis is so bogus — fed budget costs are the ones that matter least, not most. so congress makes a big deal out of the shiny object (fed budget) and distracts us and keeps us ignorant of the cost figures that matter.
thanks.
Good advice. Thanks.
A mandate will mean that health insurance costs will make up a larger share of the family budget. This should be reflected in the CPI (IF they are honest). The CBO needs to figure the increased entitlement costs due to a more rapidly rising COLA without a public option to keep costs down.
my thanks to you!