Senate Finance Committee Chairman Max Baucus unveiled his healthcare-reform bill Wednesday on Capitol Hill.
(Susan Walsh/AP)Photos (1 of 1)
CBO: Baucus healthcare plan would cut deficit
By Laurent Belsie | 09.16.09
Democratic Sen. Max Baucus’s newly unveiled healthcare bill would cut the federal deficit by $49 billion over the next decade.
That’s right. Healthcare reform would cost less than doing nothing, according to a preliminary analysis released Wednesday by the Congressional Budget Office (.pdf) (CBO) and the Joint Committee on Taxation. While the bill would mean increased outlays of $774 billion between 2010 and 2019, it would raise $215 billion by taxing high-premium health-insurance plans and collecting $59 billion in other revenue.
Projected net cost for the decade: $500 billion.
The bill also calls for changes in the way healthcare funds are spent, which the CBO said would save $409 billion over 10 years. Add other tax provisions that would raise $139 billion and voila!, a bill that people worried would cost taxpayers might actually save them money.
“Those estimates are all subject to substantial uncertainty,” the CBO and joint committee hasten to add in their letter to Senator Baucus. Still, the analysis will be closely watched because of the CBO’s role as scorekeeper of bills on the federal budget.
That healthcare reform could actually save money doesn’t surprise some observers. “It’s not hard to imagine,” says John Holahan, director of the health policy group at the Urban Institute. “You can easily get there.”
He thinks the bill will run into problems because it’s not generous enough, causing many healthy low-income people to opt out of the program because they can’t afford it.
Conservatives charge the opposite of the CBO’s projections: healthcare costs will go up and quality will go down. Forecasts of future government healthcare spending can be woefully under their actual cost, pointed out GOP staffers of the Joint Economic Committee report (.pdf) in July. In 2006, for example, Massachusetts passed a universal coverage plan that was predicted to cost roughly $472 million in fiscal year 2008. Instead, it cost $628 million.
“Initial public estimates appear to have simply underestimated the level of demand for the proposed new benefits,” the report concluded, “perhaps due to insufficient data or a lack of experience administering benefits of that sort.”
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Comments
2. John | 09.16.09
The Dems should do what they should have done all along, pass health care reform with the public option. The Republicans never had any intention of coming on board with any plan. They just wasted several months of time in getting this thing done. They have no ideas. Their ‘plan’ was the status quo to make sure those health care industry checks keep on coming.
3. Deanna W. Kaskin | 09.17.09
Oh goody - I can’t wait to have a bearucrat decide when, how and how much health care I should receive especially when I am over the age of 65. Limiting the options of care is just what a person needs when they are sick! Can’t you just see one of our esteemed Senators or Representatives limiting their care if they developed a dread disease?
And, for this we are going to be paying more in taxes? This makes does not make sense.
If a way could be found to obtain health insurance for those who have been denied coverage because of pre-existing conditions and NOT bankrupt the insurance carriers, I think that would be a great reform.
I think the premise that the “government does not have money of its own” has been forgotten. The public’s money does NOT belong to the government.
Thank you.
4. Wayne K. | 09.17.09
Am I missing something here? In the article, I can see $413 billion of new taxes being confiscated from hard working Americans ($215B in taxing high-premium health plans, $59B in “other revenue,” and $139B in “other tax provisions”), all to save $49 billion over 10 years. What a deal!!!
Gee…if I had the ability to tax others, I could create “savings” just like Sen. Baucus.
It is becoming obvious that Americans don’t want these freedom-destroying health plans. Let’s not force the country into doing something that’s unconstitutional.
5. Steve | 09.17.09
Karen,
The OPM web page doesn’t reflect the total cost of insurance, just what the employee pays. So while the rates are indeed good, it only accounts for about 25% or so of the total cost. So if we are going to offer those same plans to the entire public there is a significant hidden cost.
6. Tom Degan | 09.18.09
Count on this: There will be a nice-paying, cushy job for Max Baucus at some insurance lobbying firm - or the Republican National Committee - next time ’round when he is defeated for reelection as surely he will be - as surely he must be..
It’s people like poor old Max that are the walking, talking personifications of why I left the Democratic party over a decade ago. They have forgotten that they are (or were) the party of Franklin Delano Roosevelt. Pity.
http://www.tomdegan.blogspot.com
Tom Degan, Goshen, NY
7. Sheila | 09.18.09
I’m so tired of all this retoric from both sides. Nothing that either party will do is going to help us, the general public. The only ones who will win in the end are the health insurance companies and the government. It sounds like we’re only being told part of the story (as usual). What are these “other revenues” and “other tax provisions”? I don’t see them spelled out to my satisfaction. All I know for sure is that I feel like we’re going to get screwed in the long run, one way or another. And I can’t understand penalizing people for not getting insurance. If you can’t afford it what are you supposed to do? It’s like auto insurance, that was made manditory for everyone and I didn’t see the prices coming down, the insurance companies just got a permanent income stream. And I believe that will be the same for health care as well.
8. hsr0601 | 09.19.09
The State Of “Yes We Can”, Minnesota Knows Better !!
1. As regards a make-believe scheme, the source of funding coming from a middle class is utterly against the commitment of Democratic party.
2. No cost-competitive advantage does not clear the grave concern about the unsustainable cost of overall health care program in the long run.
3. Even with some benefit for primary practitioners, the baseless scheme does not come with fundamental payment reform, or a pay for value reimbursement formula. It means that the insurer-friendly scheme is not cleaning up the concerns over a quality issue and $9trillion of deficit over the next decade.
((Here is some of CBO analysis : While the costs of the financial bailouts and economic stimulus bills are staggering, they are only a fraction of the coming costs from Social Security, Medicare, and Medicaid. Over the next decade, the Congressional Budget Office (CBO) projects that each year Medicaid will expand by 7 percent, Medicare by 6 percent, and Social Security by 5 percent. These programs face a 75-year shortfall of $43 trillion–60 times greater than the gross cost of the $700 billion TARP financial bailout)).
4. For Medicare & Medicaid system to survive from the most wasteful structure on earth, enough savings by ways of fundamental changes need to be secured, in return, the savings thereof suffice to meet the goal of well-planned public option.
((Even with far less visits to docs, which average a half or a third of them in any other free states, Americans pay roughly twice as much per person right now)).
5. For the record, prior to nation-wide deployment of reform, The State Of “Yes We Can”, Minnesota influenced by Mayo clinic spends “20 percent” less per patient than the national average and 31 percent less than in the highest cost state. It highlights that no substantial tax raise is needed at least for sure.
((The $583 billion of revenue package, and the astronomical savings of public option aside, “20%” of $923.5bn (the combined Medicare and Medicaid cost per year, as of July) represents around $184.7bn per year and 1.847trillion over the next decade, and this patient-centered value alone could be sufficient to meet the goal of public option)).
6. In brief, the long-awaited and most hopeful health care plan is to meet these criterias : Affordability, Quality, and A Check function against runaway premiums thereof.
Clearly enough, due largely to its lower overhead cost, purchasing power and fundamental payment reform, the well-planned public option would be an even better candidate than the fabricated scheme by THE INDUSTRY in these aforementioned regards.
Now is the moment to turn page to contemporary energy and financial upgrades glossed over in 8 years.
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1. Karen O’Brock | 09.16.09
The best kept secret has still not hit the papers. The website is that of the Office of Personnel Management and shows just exactly what all of our Senators and Representative pay for their health care. There are also options for dental and vision needs, which are also much lower in price than you can find anywhere.