CBO reports Baucus bill will cover 94% while reducing federal deficit
Senators Baucus and Snowe talk during a Senate Finance Committee hearing (Win McNamee/Getty)
In an announcement that should propel the Senate Finance Committee’s health care reform bill (“the Baucus bill”) to the forefront of the legislation soon to be considered by Congress, the Congressional Budget Office has reported that the Baucus bill will cost $829 billion over ten years, well below the “magic” number of $900 million. This puts the proposed legislation well under the price required by the White House directive that any health care reform bill be ‘deficit neutral.’
The CBO additionally estimated that 94% of the eligible population would be covered at the $829 billion price tag while actually reducing the federal budget deficit by $81 billion over a decade. The bill could also, according to the CBO, lead to “continued reductions in federal budget deficits” in the years that follow.
Reacting to the positive development, the legislation’s primary author, Chairman Max Baucus, spoke on the Senate floor.
This legislation, I believe, is a smart investment on our federal balance sheet. It’s an even smarter investment for American families, businesses and our economy.
Having now received the CBO score that Baucus was hoping for, the Senate Finance Committee could vote the bill out of committee and recommend it to the full Senate as early as Friday.
While the lowered costs of reform may give cover to Republicans looking for an excuse to vote for health care legislation, proponents of a public health option may view the development as giving the GOP further ammunition to shoot down the public plan, arguing that it would push the costs over the $900 billion number.
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Rick how much would the public option kick it over 900 billion? Frankly I think as long as we keep the entire thing under a trillion by a few billion it’s a go.
I honestly don’t know how much it would add. I do know that it can’t go over $900 billion as Obama swore he wouldn’t sign anything that cost a penny more.
In response to another comment. See in context »There’s always wiggle room Rick.
In response to another comment. See in context »Maybe. But I’m not sure there is 10% wiggle room. $100 billion probably exceeds what would be possible under the Obama directives.
In response to another comment. See in context »What will this mean for the man who said, “I’m not the first President to take up this cause but I’m determined to be the last”?
Great question… very long answer. You might want to read some of the blogs I’ve written in the past two weeks relating to the Baucus bill.
In response to another comment. See in context »Hello Rick,
Surely you are not going muddy up the debate about health care reform with mere facts are you?
Don’t you just hate when I do that!
In response to another comment. See in context »BREAKING: Senate GOP Folding Over Health Care Reform
I am told quite reliably that in a meeting today on Capitol Hill, Republican Senators began to rapidly move toward concessions on health care because they are afraid they cannot hold their members. Some Republicans are now thinking of supporting a government program.
http://www.redstate.com/erick/2009/10/07/breaking-senate-gop-folding-over-health-care-reform/
That would be a very big deal. I wonder if that will turn out to be true.
In response to another comment. See in context »I’m not sure it has to be true Rick, you know what the say “perception is everything”. A lot of chinks are starting to open in the right wing’s armor. As Bob Dole pointed out, this is going to happen.
In response to another comment. See in context »Certainly something is going to happen. But bear in mind that the proposal put forth by Dole, Daschle and their Bipartisan Policy Coalition did not include a public option.
In response to another comment. See in context »I don’t really see that as the pertinent, Dole and Frisk give the fence sitters cover. That’s what matter, not the specifics.
In response to another comment. See in context »Just the idea of the govm’t forcing people to buy healthcare insurance from the private companies makes me crazy. More money in their pockets; and still no healthcare for the poor, who will have to buy ‘catastrophic’ policies with the highest deductibles … And if people refuse to buy in, even w/subsidies, what then? fines???? prison?? I just don’t get it.
No prison. This is a technicality because the penalties would be assessed when filing your tax return and failure to pay your taxes can land you in jail. But the good news would be that when you go to jail, you are entitled to health care!
In response to another comment. See in context »How can it cover 94% if obama said their would be no public option….? Huh?
When did the president say any such thing?
In response to another comment. See in context »This would be the result of the subsidies that the government would give to various degrees based on income levels. This would allow 94% to achieve coverage. Bear in mind that 15% are now without insurance and most estimates put illegal aliens (who would not be included) at a large percentage of that. Thus, reducing this number by 9% (including the illegal aliens who would not be covered) is fairly realistic. It also takes into consideration those who already qualify for Medicaid. The number is probably reasonably close to accuracy. But what it doesn’t speak to is the quality of coverage and how much people will have to go out of pocket in addition to premium charges as a result of higher deductibles, co-pays, etc.
In response to another comment. See in context »I’ve had it…a mandate to buy insurance from the very crooks who got us in this mess…Bush could have passed this in a month. I’ve done everything I can, wrote letters, donated money and time, written here, only to return to the same sick feeling of frustration I had during Bush. I heard there was going to be a push for the public option, inside dealing and all that crap. Big business has screwed the pooch and it hurts.
Geez dude chill, there is going to be a public option. What makes you think there is not? Also lets stop putting the cart before the horse. The Baucus bill is just one of many, before any of this even gets to the floor this bill has to be married with the Kennedy bill. Then you have the bills in the House which have to be merged. Finally the House and Senate bills have to be merged.
Let’s also not forget just how far we’ve all come in the process, for the first time in about 60 years we have all the relevant committees on the Hill putting out the bill, we’re in the home stretch now, no time to give up the fight, this is when it gets fun!
In response to another comment. See in context »According to Brian, the public option is still alive. We’;ll see.
In response to another comment. See in context »According to Rick it was dead months ago, and yet it still the biggest item on the plate!
Rick you order that bottle of tequila and pale of limes for me yet?
In response to another comment. See in context »Not yet. I still don’t think we’re going to see a public option —maybe a trigger, Olympia Snowe style. But, as I continue to say, nothing would make me happier than to send along that bottle!
In response to another comment. See in context »Well that’s a tough one Rick, does a trigger mean our bet is a draw?
In response to another comment. See in context »Come on, fess up…the CBO numbers are on impact to the budget and have nothing to do with the cost to society…no cost controls…how about a audit into the cost to all of us…30% overhead to middle men who do nothing to deliver health care…prices will continue to rise because like the IRS…WE WILL HAVE TO PAY THE ALREADY HIGH COST OF INSURANCE. Why do people not have insurance….shit…I’m going to have a martini, a blood pressure pill and a swim or visa versa.
In response to another comment. See in context »I think libtree is right about this. Congress has yet to pick up the issue of why insurance is so expensive. THe 30% overhead number never appears to have been discussed and there appears to be little in the Baucus bill that will actually lower costs.
In response to another comment. See in context »I’m participating in a conference call discussing the bill in a few hours and may have more info to send along.
Mandating all Americans to buy health insurance results in a good CBO review, but doesn’t it move that expense over to the public via the mandate? As in: instead of paying more taxes for government-run insurance, might we all end up paying the same amount we would have paid for a public option, except we will pay it to private insurers? [And, if everyone must buy in, but there's no mechanism to keep rates low, might insurers charge even more? Just because it's off the government's books, that doesn't mean taxpayers aren't paying somebody.]
Would this plan amount to any real savings for most Americans?
I suspect you will end up paying more to the private insurers than you would to the government. See my earlier post from today on this topic.
In response to another comment. See in context »Rick doesn’t govt. subsidies in fact give the govt a lot of power of the insurance companies as these plans go into effect?
Also lets not lose sight of the aspects of the various bills going around, lets not focus solely on the public option folks, there are a lot of trees in this forest.
In response to another comment. See in context »If the Cantwell amendment were to be ultimately adopted, the subsidies would be given to the states to act as the negotiating agent for those between 133%-200% of the federal poverty line. I think this would give the states considerable power to help keep a grip on insurance rates for these people. If Cantwell’s idea doesn’t survive, not so much. Just because I have $6500 from the government in my hands to use when buying insurance, I”m still one guy against the insurance company and no real bargaining pwoer. The Cantwell Amendment is a really good idea and will, hopefully, be part of a final law.
In response to another comment. See in context »Read it. Good points.
So have the Democrats figured out how to create reform that’s worse than nothing at all? I am…unimpressed. To use a polite word.
In response to another comment. See in context »I can’t resist weighing in with this observation: A health policy wonk I greatly admire said, at the end of a long, long debate full of data and analyses – “Just remember this one number: 19.7. That’s all: 19.7 Based on the past half-century plus, if we don’t pass a reform bill, that’s how many years it’ll be before we get another chance.” I’m not sure I have 19.7 years.
I think the key is if we can’t get anything that’s that good, we shouldn’t do anything that could in many areas make things worse.
In response to another comment. See in context »Zaid,
You are right, thank you, all this talk about a bad bill is better than no bill is so terribly wrong. The Baucas bill will make things worse and in ten years we will be bailing out the health industry, because as Rick has said it will collapse under its own weight. Me, if I see the bridge is out, I’m not getting on the train.
In response to another comment. See in context »Actually, I think this is an overstatement. While there is much in the Baucus bill I don’t like, there definitely is some good stuff that is worth doing. Also, the remaining bills under consideration, have much to recommend them.
In response to another comment. See in context »This becomes a question of degrees.
And, by the way, I think the system will inevitably lead to a single-payer system (with a private component for those who want to buy it) no matter what legislation is passed, good, bad or indifferent.
Maybe like me the committee just likes pissing off Republicans!
oppps, wrong post, damn tabs
Who are the 6% or 18% who won’t be covered?
I know who they are.