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The Congressional Budget Office scores the amended Senate bill

Another day, another Congressional Budget Office report (pdf) saying that health-care reform will cover more than 30 million people while substantially cutting the federal deficit.

There are a couple of changes worth noting here. First, the CBO says that the national non-profit plans will have little effect on average premiums. "The presence of the public plan had a more noticeable effect on CBO’s estimates of federal subsidies because it was expected to exert some downward pressure on the premiums of the lower-cost plans to which those subsidies would be tied," the agency concludes.

There are a couple of new insurance regulations of note. The original Senate legislation allowed insurers to place annual caps on benefits. The manager's amendment prohibits such caps. This, the CBO says, has a slight upward effect on premiums. There are also new rules prohibiting insurers from spending less than 85 percent of each premium dollar on medical care -- if they exceed that cap, they need to send customers a rebate. This lowers costs slightly.

The individual mandate has been strengthened slightly, as has the Medicare Commission. Sen. Sherrod Brown looks to have scored a win with a provision that accelerates the introduction of generic biologic drugs. Sen. Ron Wyden scored a small win with vouchers that workers can use to buy insurance in the exchange if their employer's offerings are not affordable. The voucher will be for the amount the employer would otherwise have contributed to the insurance plan, and CBO expects 100,000 people to use it.

And then there's my favorite sentence in the CBO report: "The 5 percent excise tax on cosmetic surgery was eliminated, and a 10 percent excise tax on indoor tanning services was added." Alrighty then.

By Ezra Klein  |  December 19, 2009; 12:36 PM ET
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Awesome - the Jersey Shore provision.

Posted by: bean3 | December 19, 2009 12:59 PM | Report abuse

Can anyone here explain why CBO scores are given such credibility?

Posted by: bobsteph1234 | December 19, 2009 1:04 PM | Report abuse

That's the same CBO that recently declared that a provision that premiums have to be made at least of 90% of costs amounts to a "nationalization" of the insurance corporations? Come on, why should anyone believe anything coming out of this obsiously dishonest outfit after this?

Posted by: Gray62 | December 19, 2009 1:04 PM | Report abuse

"...a 10 percent excise tax on indoor tanning services was added." John Boehner is going to be paying for some of my health care. Poetic justice, I must say.

Posted by: tnoord | December 19, 2009 1:06 PM | Report abuse

"There are a couple of new insurance regulations of note."
Oh yeah? And the same administration that totally capitulated to the demands of Aetna & Co, deliverd through their faithful servant Joe Lieberman, will be really really tough on the same insurance corporations when it comes to regulation? You mean, they will hire more than one totally deaf and dumb guy for that agency? Hahaha!

Posted by: Gray62 | December 19, 2009 1:08 PM | Report abuse

"The 5 percent excise tax on cosmetic surgery was eliminated, and a 10 percent excise tax on indoor tanning services was added." Alrighty then.

tnoord, this does prove beyond any douby that Pelosi's influence can be felt in the Senate.

Posted by: bobsteph1234 | December 19, 2009 1:25 PM | Report abuse

Surely, the excise tax on indoor tanning must be aimed at Sarah Palin.

Posted by: dk10024 | December 19, 2009 2:00 PM | Report abuse

Tanning services? Anyone here have insurance that covers tanning services? Can't imagine any medical condition (or preventative measure) that would require "tanning" as a medical necessity.

Posted by: onewing1 | December 19, 2009 2:49 PM | Report abuse

Pity. The 5% on plastic surgery would have produced much higher revenues and been better targeted.

Still, covering a modicum of the cost of the externalities of indoor tanning is a win.

If the public option wouldn't have reduced premia noticeably, how come the CBO thinks it would have been a notable savings to the government? The percentage reduced should be about the same...

Posted by: klhoughton | December 19, 2009 3:58 PM | Report abuse

Tanning beds are probably a better thing to tax than cosmetic surgery, since tanning beds are very carcinogenic. It's kind of a silly tax either way, but you gotta raise money somehow.

Posted by: usergoogol | December 19, 2009 3:59 PM | Report abuse

The fact that Congress can't pass a 5% tax on cosmetic surgery says it all. At the same time, working families are everybody's favorite gimp. It comes through crystal clear in the strengthening of the mandate to buy junk insurance that none of these people knows what it's like to struggle to pay bills.

Posted by: bmull | December 19, 2009 4:24 PM | Report abuse

What do you think about the politics surrounding the Medical Loss Ratio (MLR). I read that Rockefeller wanted a minimum 90% for the MLR, but the CBO forced Reid to reduce it to 80% by threatening to treat insurance cash flows as government cash flows. What's your opinion on the CBO's behavior.

By the way, I've seen the tweet by Yglesias, and I'd appreciate it if you didn't focus too much on the bright side of having the minimum raised to 80%.

Posted by: bcbulger | December 19, 2009 7:21 PM | Report abuse

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