Senate health care bill would reduce deficit, analysis finds

McClatchy NewspapersOctober 7, 2009 

WASHINGTON -- The Senate Finance Committee's health care overhaul effort got a boost Wednesday when the nonpartisan Congressional Budget Office estimated that it would cost $829 billion and reduce the federal deficit by $81 billion over the next 10 years.

That's good news for the committee and President Barack Obama, since the CBO reported not only that the measure meets their cost and deficit goals but also that 94 percent of eligible Americans could be expected to obtain coverage under it, up from the current 83 percent.

About 23 million people would buy policies through new insurance exchanges, or marketplaces, in which they could comparison-shop for coverage, the CBO said, and about 14 million more would enroll in Medicaid, the state-federal program for lower-income people, and the Children's Health Insurance Program, as benefits and in some cases eligibility increased under the measure.

About 25 million nonelderly people, about a third of them illegal immigrants, probably would remain uninsured by 2019, the CBO estimated.

"The report, I think, is quite promising," said Finance Committee Chairman Max Baucus, D-Mont. Added Senate Majority Leader Harry Reid, D-Nev., "We are closer than ever before to delivering Americans access to quality, affordable health care in a fiscally responsible way."

Senate Republican leader Mitch McConnell of Kentucky was less enthusiastic. "This partisan Finance Committee proposal will never see the Senate floor, since the real bill will be written by Democrat leaders in a closed-to-the-public conference room somewhere in the Capitol. The real bill will be another 1,000-page, trillion-dollar experiment that slashes a half-trillion dollars from seniors' Medicare, raises taxes on American families by $400 billion, increases health care premiums and vastly expands the role of the federal government in the personal health care decisions of every American," he charged.

The CBO analysis clears the way for Baucus' committee to take a final vote on its plan, probably later this week.

If it's approved -- passage is expected, because the committee has a 13-10 Democratic majority -- it would be the final preliminary step before the full Senate and House of Representatives debate health legislation.

Each will consider one bill. Three House committees have written similar versions of the legislation, and Democratic leaders expect to meld them into a single version. All three bills contain a government-run alternative to private health insurance, commonly referred to as a "public option."

In the Senate, Democratic leaders have begun trying to combine the pending Finance Committee version with a different one that the Health Committee adopted this summer.

The Health panel's bill includes a public option, while the Finance version would create co-ops, or nonprofit, member-run companies.

Baucus has said that he tried to craft a plan that can get 60 votes in the 100-member Senate, the number needed to clear procedural hurdles. His bill has many of the same features the others do, such as barring insurers from denying coverage because of pre-existing conditions, requiring nearly everyone to obtain coverage and giving financial help to those who can't afford insurance.

There's been some Democratic grumbling in the Finance Committee over parts of Baucus' plan, but the CBO apparently made his task easier.

One concern of more conservative Democrats has been cost. The CBO found that revenue will come from several sources.

The committee's proposal for a 40 percent excise tax on most high-cost insurance plans would raise about $201 billion. Penalty payments by consumers and employers who don't comply with coverage requirements could raise $23 billion, while other tax revenues and budget adjustments would reduce deficits by $83 billion. Each figure is a 10-year total.

The CBO assumes billions in savings from changes in Medicare and other government health programs. The savings and tax revenues, the CBO forecasts, would more than offset anticipated costs for subsidies for those who can't afford coverage and additional spending on Medicaid and the children's health program.

The CBO warned, however, that the committee's work hasn't yet been converted into legislative language. The panel works from conceptual language, with details to come later.

Those details, CBO Director Douglas Elmendorf said, "could lead to significant changes in the estimates of the proposal's effects on the federal budget and insurance coverage."

ON THE WEB

CBO analysis of Senate Finance Committee health care plan

Consumers Union ad and poll

Side by side comparison of health care bills

MORE FROM MCCLATCHY

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For more McClatchy politics coverage visit Planet Washington

McClatchy Newspapers 2009

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