CQ TODAY ONLINE NEWS
– HEALTH
July 18, 2009 – 11:18 a.m.
CBO: Health Bill Would Hike Deficit by $239 Billion
By Jonathan Allen and David Clarke, CQ Staff
The House version of a health care overhaul bill would produce a deficit of $239 billion over 10 years, according to a new Congressional Budget Office estimate.
The CBO estimate released late Friday pegs the gross cost of the bill (
The analysis also shows that many of the provisions would have no net impact on the deficit, which could severely complicate any effort to consider the legislation through filibuster-proof fast-track “reconciliation” rules in the Senate.
The big deficit number — larger than the one run by the government for all of fiscal 2007 — is likely to add weight to the burden of Democratic leaders, who have said they plan to pass the bill on the House floor before Congress leaves town for its annual August recess.
In Saturday’s weekly radio and Internet address, President Obama said, “I will not sign on to any health plan that adds to our deficits over the next decade. And by helping improve quality and efficiency, the reforms we make will help bring our deficits under control in the long-term.”
Republicans and moderate Democrats have been voicing concerns about the anticipated price tag of the bill.
However, a statement released by the three House Democratic chairmen shepherding the bill through the committee process — Californians Henry A. Waxman of Energy and Commerce and George Miller of Education and Labor, along with New Yorker Charles B. Rangel of Ways and Means — argues that the score shows the health overhaul to be deficit neutral.
The reason: the bill’s $245 billion “fix” to Medicare payments to physicians. Without it, they said, the rest of the bill would produce a $6 billion surplus over 10 years.
“This fulfills the strong commitment of the president and House leadership to enact health reform on a deficit-neutral basis,” the chairmen said. “The reforms included in this legislation will help control health care costs and expand access to quality, affordable coverage to all Americans in a fiscally responsible manner.”
Their aides argued that the costs of the physician payment provisions should not be counted “as they will be absorbed under the upcoming statutory ‘pay go’ legislation that is pending in the House.”
“Pay Go” is shorthand for requiring Congress to make sure new mandatory spending is balanced by something that either reduces spending or brings in more federal revenue.
Democrats aren’t alone in saying they wouldn’t offset the stagging cost of dealing with the doctor payment formula. Lawmakers on both sides of the aisle have signaled that they wouldn’t use budget cuts or tax hikes to offset it.
The CBO score does not assume the enactment of future legislation. It also doesn’t factor in administrative costs, or the agency’s indendent analysis of legislative language; it’s based only on information provided to CBO by the House committees.
A crucial part of the backstage maneuvering on the health bill involves the change to Medicare payments to doctors. President Obama’s budget uses a different method than Congress for measuring the cost of doing that, and House Democrats have agreed to accomodate Obama’s way of handling the books on that. In exchange for going along with that, the generally tight-fisted Democrats in the Blue dog Coalition won a promise to bring to the floor a measure that would enforce budget discipline by making “Pay as You Go,” or Pay Go,” the law.
When that bill (
Budget watchdogs have criticized that plan, saying it would add to the deficit.
Fine Print and Procedure
By speaking generally about health plans rather than specifically about the House bill, Obama has room to brush aside, for now, warnings about the long-term costs of the legislation while all the fine print is being worked out prior to Congress sending a bill to his desk.
Cost has been a major concern for many lawmakers and despite its caveats and limitations, the official CBO score undoubtedly will provide more fodder for those who argue that health care costs will not be contained under the legislation.
The CBO score raises the prospect that lawmakers could have tremendous difficulty if they try to use the fast-track budget reconciliation process to circumvent a Senate filibuster of the legislation.
The reconciliation process, designed originally to bring down deficits, provides procedural protection from filibuster to certain bills that affect spending or revenue. But under the so-called Byrd rule, all provisions of a reconciliation bill must produce changes to one side of the ledger or the other.
The CBO estimate identifies dozens of provisions that would have no net impact on the deficit, suggesting that it would be difficult to rewrite the legislation to avoid giving foes an easy target to shoot down on the Senate floor — as has happened before on big bills. In 2005, for instance, Sen. Kent Conrad , D-N.D., frustrated Republican attempts to pass a package of $40 billion in spending cuts by objecting to a series of studies required by the reconciliation bill that would have had no impact on the deficit.
Who’s Covered?
The CBO estimate says that by 2019, the bill would result in insurance coverage for 97 percent of the documented population. For many involved in the debate, that’s the only number that counts.
Obama on Saturday emphasized that point, saying: “This is what the debate in Congress is all about: Whether we’ll keep talking and tinkering and letting this problem fester as more families and businesses go under, and more Americans lose their coverage. Or whether we’ll seize this opportunity — one we might not have again for generations — and finally pass health insurance reform this year, in 2009.”
Worth noting is that enactment would not immediately bring widespread health coverage. The CBO estimated that the number of uninsured would continue to rise until 2013.
Democrats have crafted the House plan to delay coverage expansions until then in order to meet their own goals for limiting the projected cost during a specific 10-year window, 2009-2019.
Alex Wayne contributed to this story.




Comments
A new 'incomplete' analysis by congressional budget experts of emerging House legislation said it would increase deficits by $239 billion over a decade. CBO does not score any savings from prevention / wellness and the rest, even if Prevention / wellness is an actual and essential part of the savings. Besides, the Times in a July 7 editorial argued "As much as 30 percent of all health-care spending in this country?some $700 billion a year?may be wasted on tests and treatments that do not improve the health of the recipients," . And I think the others such as increased productivity, potential stem cell effect, decreased mental stress, and massive job creation considered, the reform might be within reach. The report of stem cell research turned around the stock markets world-wide, and then what if the reform package clears the Congress ?
POST A COMMENT
Oops! The following errors must be addressed: