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The 900 Billion-Dollar Man


It'll be hard to say anything definitive on the Baucus proposal before we can see all the details. At the moment, Politico has the clearest rundown of what people think they know is in the plan. But in advance of the president's speech on Wednesday, we do seem to know Baucus's most crucial contribution to the debate: the number $900 billion.

That's the ballpark estimate for the Baucus bill, and though it's less than one might hope, it's a lot more than many were beginning to fear. The combination of sinking poll numbers, emboldened Republicans and anxious centrist Democrats had gotten some on the Hill -- and, more to the point, in the administration -- talking about a substantial retrenchment on health-care reform. The number I'd begun to hear was $700 billion. And you can't do real health-care reform for $700 billion.

There were two scenarios for $700 billion bill. The first was that Baucus managed to get Republican support for a more incremental measure and chose to run with it. The second was that the White House decided sure passage for something modest was a better bet than uncertain passage of something more comprehensive.

With Baucus coming in around $900 billion, both of those scenarios are short-circuited. The range of possibilities is now between the $900-or-so billion envisioned by Baucus and the $1.1 trillion envisioned by the House plan. That cements a consensus in advance of the president's speech laying out the White House's plan: Obama, after all, can hardly emerge with a stingier proposal than Baucus has offered.

That said, $900 billion is still less money than you really want for this plan. Something around $1.2 trillion is a better bet for doing this right. The difference there is a pretty manageable $30 billion a year. The hope is that Baucus's bill looks better after it's amended by the other Democrats on the Finance Committee, merged with the more generous HELP Committee bill, and then tweaked on the Senate floor by the Democrats left out of both processes. But the fact that we're talking about $900 billion as opposed to $700 billion means we're in a much better place than we could have been.

Photo credit: Linda Davidson -- The Washington Post.

By Ezra Klein  |  September 8, 2009; 8:30 AM ET
Categories:  Health Reform  
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Next: Eight Questions About Health-Care Reform


I think the thanks goes to liberals in the House and Senate. I think some group threatened to come out right after his speech and declare him a weakling loser if he backed down for universal.

Posted by: JonWa | September 8, 2009 8:47 AM | Report abuse

Just to correct the record. Your correspondent in Manassas erroneously reported last week that I had written an article stating that an individual mandate was unconstitutional. There is no such article and I have no reason to doubt the constitutionality of an individual mandate. Keep up the good work!

Posted by: alicerivlin | September 8, 2009 9:41 AM | Report abuse

The Baucus bill depends on the details. The one question that I have is this:

Many (most?) states require individuals to carry automobile insurance. I'm not aware of a public option in that setting. Why should an individual mandate include a public option? I keep hearing that an individual mandate will just "fill the coffers" of insurance companies, but will it? They're denying folks for a reason.

If we prohibited insurers from denying people for preexisting conditions and we prohibited them from refunding premiums and refusing to cover people for illnesses as they make claims and we did some other insurance reforms, would a public option be necessary?

Posted by: teoandchive | September 8, 2009 10:13 AM | Report abuse

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