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CBO: Health-care reform bill cuts deficit by $1.3 trillion over 20 years, covers 95%

Washington has spent the past week or so waiting for the Congressional Budget Office to release its preliminary estimate of the Senate bill with the reconciliation fixes. Not only are those numbers important for the debate, but Democratic leaders refuse to release the actual text of their changes until CBO releases the specifics of its analysis.

According to a Democratic source, CBO has finished its work and will release the official preliminary score later today. But here are the basic numbers: The bill will cost $940 billion over the first 10 years and reduce the deficit by $130 billion during that period. In the second 10 years -- so, 2020 to 2029 -- it will reduce the deficit by $1.2 trillion. The legislation will cover 32 million Americans, or 95 percent of the legal population.

To put this in context, that's more deficit reduction than either the House or Senate bill, and more coverage than the Senate bill.

How they got these numbers, and whether there are important qualifiers, will be easier to say once CBO releases its analysis. But the bottom line is that this is the exact sort of score that Democrats wanted, and is in fact considerably better than some had come to expect they would receive. Coverage is better than the Senate bill, which will reassure liberals, and deficit reduction is better than either bill, which will reassure conservatives.

By Ezra Klein  |  March 18, 2010; 9:35 AM ET
Categories:  Health Reform  
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Next: Another way the CBO score helps the Democrats

Comments

So just for the record, let it be said that there are loads of Republicans who voted for Part D, which is projected to INCREASE the deficit by over $1 trillion in the 20 years after its passage, but are opposing the health reform bill which DECREASES the deficit by over $1 trillion in the 20 years after its passage. And they are attributing their opposition (in large part) to "fiscal responsibility". Good to know.

Posted by: vvf2 | March 18, 2010 9:42 AM | Report abuse

So...just maybe this can be squeeked through?

Posted by: EricS2 | March 18, 2010 9:42 AM | Report abuse

I hope they're right. Time will tell and hopefully we get the chance to see. But again Ezra remember these are "PROJECTIONS". Sometimes I think you forget that.

Posted by: visionbrkr | March 18, 2010 9:47 AM | Report abuse

To put this into context, this bill costs less than what we send to Israel each year, a lot less; money which indirectly helps them fund their excellent health care system.

Posted by: KathyF | March 18, 2010 9:50 AM | Report abuse

"... the second 10 years -- so, 2020 to 2029 -- it will ..."

Right. My next door neighbor says he's going to quit drinking in 2020.

Posted by: ostap666 | March 18, 2010 9:53 AM | Report abuse

In other news, the CBO projects that up is now down, the Pirates will win the 2010 World Series, and that we'll colonize Mars in 2015.

Posted by: MBP2 | March 18, 2010 9:55 AM | Report abuse

Ezra, why are you citing the second ten years????? This is a RECONCILIATION bill, remember? Only the first ten years count. The second ten years are pure fantasy.

Posted by: philly211 | March 18, 2010 9:58 AM | Report abuse

This bill costs around $94 billion/year, in a ~4 trillion budget. That's really not that bad for what you're getting.

My sense is that the security that this will offer Americans will more than offset the costs of the bill in productivity and tax collections.

America's prosperity is based on letting people take chances. They can't take chances under the current system.

I'd bet a few semi-vital organs that there will be an entrepreneurial boom late in the decade, once people can get financing and health coverage.

I for one will thank the Obama administration for letting us be the capitalists we're supposed to be.

Posted by: itstrue | March 18, 2010 9:59 AM | Report abuse

Facebook... widget... not... WORKING!! *tap tap tap*

Posted by: JaneG | March 18, 2010 10:00 AM | Report abuse

Leave to the Party of No to have an issue with this. The VERY SAME OFFICE that warned Bush about the cost of the war in Iraq and that HE IGNORED now are telling us this is a GOOD THING for the nation, it CUTS THE DEFICIT and HELPS THE CITIZENS. So what do these yokels do?

Try to tell me my freedom is at stake.

Got and f-yourselves.

Posted by: Mighty7 | March 18, 2010 10:06 AM | Report abuse

So, we're supposed to believe that these numbers aren't flawed? Give me a break people. The Demons did NOT put everything in this bill, they plan to load it up during reconcilliation. They have lied about everything else, and now we're supposed to believe that they will be honest? B.S.!!

It is impossible to believe that you will overhaul HC, ADD student loans, ADD 32 MILLION NEW clients, PLUS the special deals; and this won't add up to over a trillion dollars?

Whatever! And I have a peice of moon rock for sale.

Posted by: obamaalmighT | March 18, 2010 10:09 AM | Report abuse

Everyone needs to look at Massachusetts'
universal healthcare. Read about it; its
very similar to Obamacare.
It hasn't reduced premiums. In fact, Massachusetts health premiums will INCREASE
8 - 32% in April!
56% of doctors in Mass. are Not accepting
new patients; new patients are waiting
average of 44 Days to see a doctor;
ER visits Increasing as a result of long
doctor waits;
Hospitals are going bankrupt
Why do we want the same to happen to the
rest of the country????

Posted by: ohioan | March 18, 2010 10:11 AM | Report abuse

The CBO report will be interesting reading. Senate reconciliation rules require that any "sidecar" considered through reconciliation meaningfully reduce the deficit in a 6-year window (including the current year), which must also consider the program startup costs detailed in the CBO report issued Monday.

The primary bill though, will survive: it's a great way to get the House members to vote for it (without ever actually voting for it).

Posted by: rmgregory | March 18, 2010 10:11 AM | Report abuse

A journalist would question, or at least scrutinize, the illusory nature of these numbers, such as the unlikelihood that future Congresses will follow through with the Cadillac tax or Medicare cuts.

A cheerleader will take them at face value and just continue to rah-rah for the health reform bill.

Ezra Klein is obviously waving his pom-poms ferociously.

Posted by: FreeMas | March 18, 2010 10:12 AM | Report abuse

One more thing:

If the whole thing is going to cost $940 billion over 10 years, and we’re going to start collecting all these taxes and fees four years in advance of providing the benefits, what do you think they’re going to do with the money during the ensuing four years?


Are they going to deposit it in an interest-bearing bank account?

Are they going to invest it in small cap companies to try to earn a return?

Are they going to put it under Christopher Dodd’s mattress?


The answer, of course, is none of the above. What are they going to do with the money as they collect it over the course of the next four years in advance of providing the “benefits”? They’re going to spend it. All of it.

That’s what they always do with money.

That’s what they do with the money in the so-called Social Security Trust Fund. That’s the money they take from your paycheck in the form of the FICA withholding tax. It’s supposed to be set aside for your future Social Security benefits. It’s not. They spend it as soon as they get it on a) current payouts to Social Security beneficiaries, and, when there is money leftover; b) anything else they want to spend it on.

A government that is running annual deficits in excess of $1 trillion, as the federal government projects to do for the rest of the decade under President Obama’s own budget numbers, is not going to stash away hundreds of billions in cash in a shoebox. It never has – no matter how sacrosanct the supposed purpose of the money – and it never will.

http://www.northstarnational.com/2009/12/21/obamacare-taxes-start-now-benefits-2014-ok-stash-money-wait-spend-it-you/

Posted by: obamaalmighT | March 18, 2010 10:13 AM | Report abuse

"the bottom line is that this is the exact sort of score that Democrats wanted"

I'm shocked, SHOCKED! How convenient.

Posted by: lbataille55 | March 18, 2010 10:19 AM | Report abuse

Wow, look at all the wingnuts here claiming the CBO numbers are worthless. These are, mostly, the same people who LOVED the CBO when the Republicans were in power.

Hypocricy much?

Posted by: nisleib | March 18, 2010 10:19 AM | Report abuse

This isn't related to reconciliation. Reconciliation just requires that the laws be budgetary, not that it be deficit neutral. The CBO thing is really just a challenge the Dems are taking on in this bill in addition to the actual health care issues. Kudos to them for making an attempt at cost control.

Posted by: DDAWD | March 18, 2010 10:23 AM | Report abuse

So, 32million Americans will be covered. Can anyone explain exactly how? What will be the cost of the policy? How will it affect me? How about those that cannot afford the policy; how much will the fine be? Will the government force, mandate, that every uninsured person buy a policy? Why? I have no choice? Will everyone be covered immediately?

Posted by: scmonty1 | March 18, 2010 10:24 AM | Report abuse

KathyF, I'm a supporter of the bill, but you're mistaken about this costing less than what we send to Israel. The US sends about $3 billion per year to Israel, and this bill costs over $100 billion per year once it gets going.

Posted by: vvf2 | March 18, 2010 10:24 AM | Report abuse

Great news. Now how do we get mass-market media purveyors to report it as anything other than "the $940 billion health care bill"? Saw that one on Yahoo this morning. My forehead is getting really, really, flat. I realize that a lot of people are going to be low-information by choice, like a guy I was reading yesterday who was quite sure that the Constitution required 60 votes to pass any legislation -- you remember how the supermajority was the framer's intent, there's nothing in there about the VP breaking a tie, and how there were 50 states in 1787, right? -- but it seems a pretty awful choice for the MSM to keep making over and over and over again. Including the accursed paper that publishes this excellent column.

Posted by: Jenn2 | March 18, 2010 10:26 AM | Report abuse

Congressional Budget Office projections less accurate than a horoscope

http://backseatdriver.newsvine.com/_news/2009/03/20/2573501-congressional-budget-office-projections-less-accurate-than-a-horoscope

Has the CBO, not only been right, but close?

Posted by: marteen | March 18, 2010 10:27 AM | Report abuse

Keep it up Ezra soon you will have your own show on.....

More Shows No Body Cees "network"

Mr. Ed,Tingleg ,crosseye humor, and Just BUTCH.

Posted by: JennieT1 | March 18, 2010 10:27 AM | Report abuse

As we can see by the comments here, nothing will make conservatives happy. But you're adorable for thinking that anything would.

And, not for nothing, I was just given a 50-day wait to see a doctor for something my gp said he'd like to have seen in less than two weeks.

Posted by: eRobin1 | March 18, 2010 10:30 AM | Report abuse

lbataille55, not everything is a conspiracy against Republicans. The CBO is the same independent analysts conservatives (rightfully) cite when they complain about soaring future deficits. Just check out their website -- the notion that the CBO is a bunch of secret liberal activists is tin foil paranoia of the highest order.

Posted by: vvf2 | March 18, 2010 10:31 AM | Report abuse

One trillion dollars to expand coverage for 30 million uninsured and reform Health care is a pittance compared with the 1 trillion a year we spend on endless wars for profit and occupation-wars we have no intention of winning, just prolonging.
And all that fierce opposition to a Public Plan is a sham. We already have in America a huge Public Plan that covers more than half of the population at taxpayers expense-a privileged group of more than 160 million: Congress, Federal employees, the VA, the Military, Medicare, Medicaid and the CHIPS program. The problem is that the insured minority is paying for them, the uninsured and the 12-20 million illegals that get their primary care in our Emergency rooms and Hospitals, in addition to their own private insurance-which is why this insured minority is constantly penalized by rapidly escalating private insurance premiums-double taxation.
Once this bill is passed, we can begin to expand the Public Plan with improved cost-control, centralized Administration and serious regulation of the provider billing fraud now crippling Medicare into bankruptcy that runs in the billions.
Progressive Democrats undecided know that failure to pass this bill will set back Health care reform years. It is far better than the status quo.

Posted by: lionelroger | March 18, 2010 10:32 AM | Report abuse

In 2008, the CBO predicted:

"Congressional Budget Office Reestimate of Administration’s Budget Shows Persistent Deficits

The numbers highlighted in this paper use the Administration’s budget projections released on February 4 to calculate future deficits under Administration policies, taking into account the costs of the war and AMT relief. The Congressional Budget Office’s (CBO) reestimate of the Administration’s budget, published March 3, projects still larger deficits over the next five years under Administration policies.

If we factor the costs of the war and AMT relief into the CBO estimates of deficits under Administration policies, the result is deficits in 2012 that are about $50 billion higher than the deficits we cite here. Deficits in 2012 would range from $161 billion to $244 billion, rather than from $113 billion to $195 billion."

http://www.cbpp.org/cms/index.cfm?fa=view&id=126

Now?

"The CBO and the White House are in relative agreement about the short-term budget picture, with both predicting a deficit of about $1.5 trillion this year -- a post-World War II record at 10.3 percent of the overall economy -- and $1.3 trillion in 2011. But the CBO is considerably less optimistic about future years, predicting that deficits would never fall below 4 percent of the economy under Obama's policies and would begin to grow rapidly after 2015."

http://www.washingtonpost.com/wp-dyn/content/article/2010/03/05/AR2010030502974.html

Not even close. That's only 2 years here...

Posted by: marteen | March 18, 2010 10:35 AM | Report abuse

Sure, pay into any plan for the next four years and receive no benefits and any plan will supposedly cut the deficit the first 10 years. You're only providing 6 years of coverage in those 10 years.

Games of smoke and mirrors.

Posted by: ahashburn | March 18, 2010 10:39 AM | Report abuse

what a chronicle this has been,
from the human perspective.
to see a nation where so many people and so many leaders,
have fought so hard,
with so little knowledge,
and so little heart,
against health care
that will benefit so many of their fellow americans,

this will be a better country,
and we will be a better people,
the day this bill is signed,

each day now,
we are a step closer.


Posted by: jkaren | March 18, 2010 10:41 AM | Report abuse

Time to pass the bill!

Posted by: zackool | March 18, 2010 10:43 AM | Report abuse

Does CBO stand for "Chicago Bully Office"? It is a shame when it is difficult to trust a "neutral" body based on all of the stuff that has gone on in recent times. Sorry to say, but regardless of who's idea it is, government expansion has never led to efficiency or cost reductsions. This is all a political game that neither side wants to lose for the right or wrong reasons and the Amereican people will end up the loser in this game. We need to get back to statesmanship that we have not scene in the past 15+ years. When a president and speaker of the house from two different parties can sit down over dinner and a drink and talk as Reagan and Tip O'Neill used to do in order to try and put the country first instead of party, it worked much better and as intended. While not perfect, I long for those days.

Posted by: tsch38301 | March 18, 2010 10:45 AM | Report abuse

Ezra, BOLONEY. Only fools and three year olds believe it is possible for the Federal Government to control it`s spending.

Posted by: CDNassif | March 18, 2010 10:50 AM | Report abuse

"we don't know where these numbers come from until CBO releases their data..."

Thanks, then I will wait until later today....

Posted by: mil1 | March 18, 2010 10:52 AM | Report abuse

And this doesn't factor in potential savings from pilot programs . . .

All the more reason to pass the legislation.

Posted by: JPRS | March 18, 2010 10:52 AM | Report abuse

KathyF wrote:
To put this into context, this bill costs less than what we send to Israel each year, a lot less; money which indirectly helps them fund their excellent health care system.
_______

Actually, aid to Israel is about $3 billion/year. This bill costs much more. I am grudgingly in favor of the health care reform bill and believe that Israel needs to be pressured more by the US to deal with Palestine. Whatever you believe about these issues, though, it is important to get the facts straight.

Posted by: rbtewes | March 18, 2010 10:53 AM | Report abuse

CDNassif,

Regarding: "Ezra, BOLONEY. Only fools and three year olds believe it is possible for the Federal Government to control it`s spending."

Did you sleep through the 1990s?

It wasn't until the so-called "fiscal conservatives" took over both the White House and the Congress that a hole was blown through the budget.

It is possible to control spending and reduce deficits -- because it has been done before many times over. It just never tends to happen when a certain kind of Republican gets elected to the White House.

Posted by: JPRS | March 18, 2010 10:56 AM | Report abuse

itstrue said:

"This bill costs around $94 billion/year, in a ~4 trillion budget. That's really not that bad for what you're getting.

My sense is that the security that this will offer Americans will more than offset the costs of the bill in productivity and tax collections.

America's prosperity is based on letting people take chances. They can't take chances under the current system.

I'd bet a few semi-vital organs that there will be an entrepreneurial boom late in the decade, once people can get financing and health coverage.

I for one will thank the Obama administration for letting us be the capitalists we're supposed to be."


YES YES YES I totally agree.

Posted by: DigiMark | March 18, 2010 10:57 AM | Report abuse

People might check out the study in the 'think tank' Item 3 on this page. It goes into some detail as to what happens when the objective of Federal intervention in health care is not a national policy/program but merely attempts by both 'parties' to manipulate the increasing revenue stream health represents. The Republican objections seem much more oriented toward the 'transfer of one sixth of the economy to the government' rather than containing the $300b a year waste created (intentionally to justify future costs?) by the current private sector. The Democrats appear to be intent on creating a 'secret' revenue stream to none-contributors in a system that can't physically accommodate that many non-contributors in the next ten years, again not addressing the $300b waste very well. Question: is enough waste cut from the three trillion dollar National HC system by the current HC bill to prevent the processes from becoming a seven trillion dollar black hole system by 2018? Can you spend $80 billion a year to eventually save $400 billion a year? It just might, but note Murphy's Law on system dynamics: “A complex system that works is invariably found to have evolved from a simple system that works. If there is a possibility of several processes going wrong, the one that will cause the most damage will be the one to go wrong.” Can politicians in the next few years cherry-pick the good parts of this bill and repeal those that aren’t?

Posted by: arjay1 | March 18, 2010 11:02 AM | Report abuse

The whole thing reminds me of the big fuss over the clean air act 30 years ago. Right wingers whined loudly about the costs (based on numbers from industry lobbiests), Reagan opposed it, but it passed anyway (based on cost-benefits analyses from sources without obvious biases).
The net result was that the clean-air act saved our economy about $100billion per year, at a time when the economy was growing by about $300 to $500 billion per year.
Back in the 90's I remember often hearing in the news the phrase "unexplained gains in productivity" as being a reason for economic growth whenever good numbers came out. In light of the clean air act and other environmenal protection measures, it now makes perfect sense.
I'm looking forward to 20 years of deja vu all over again....

Posted by: Denswei | March 18, 2010 11:03 AM | Report abuse

@KathyF:"To put this into context, this bill costs less than what we send to Israel each year, a lot lessTo put this into context, this bill costs less than what we send to Israel each year, a lot less".

Um...no. While Israel is the largest individual recipient of foreign aid, besides Iraq, the total annual package is measured in single digits billions. The HCR bill will spend close to $100 billion annually. Total US foreign aid (world wide) in 2010, according to the US Census Bureau was $35.9 billion.

I like the bill (though not as much as I would if it had national exchanges, and if it opened the exchanges to all workers). I'd like it even if it spent more, or was only deficit neutral. I think it should be passed. But I'm not sure how false arguments about foreign aid has anything to do with the bill. It reminds me of the 1995 Kaiser study where 41% of Americans though Foreign aid topped U.S. spending (http://www.kff.org/kaiserpolls/1001-welftbl.cfm) and Paul Krugman's point in 2001 that American's apparently want us to lower our foreign aid spending to 20 times its current level (http://www.pkarchive.org/column/122501.html).

Posted by: jresponds | March 18, 2010 11:04 AM | Report abuse

I won't go into all of the reasons to doubt the CBO report. I will leave that to others. I just have three questions. When was the last time the Government didn't underestimate the cost of anything? How many of you are willing to guarantee the value of the dollar ten years from now let alone twenty years from now. And how many of you have any faith in anyone's projections more than three or four years out?

Posted by: jdonner2 | March 18, 2010 11:09 AM | Report abuse

http://www.cbo.gov/ftpdocs/113xx/doc11355/hr4872.pdf

Here's the letter from CBO to Pelosi -- note the paragaraph after the bullet points. Lot's of "prelimary" and "not thoroughly examined the reconcilation proposal."

I know I'll put a ton of faith in the nubmers they spit out with such a strong endorsement.

Posted by: NoVAHockey | March 18, 2010 11:16 AM | Report abuse

Name one....JUST ONE.....entitlement program that came in even close to the government estimates.

Place answer here__________________________

Posted by: WrongfulDeath | March 18, 2010 11:17 AM | Report abuse

This bill, if passed and allowed to be implemented, will most likely cost between 3 to 5 TRILLION.

Posted by: WrongfulDeath | March 18, 2010 11:19 AM | Report abuse

Does anyone note that those numbers have not come from CBO and that CBO has NOT yet released anything - we are just taking what a Democratic spokesperson says as fact?

Posted by: jksteele214 | March 18, 2010 11:19 AM | Report abuse

We're going to go broke saving money like this.

Posted by: ronjaboy | March 18, 2010 11:23 AM | Report abuse

So - let's see if I got this right. Right?
CBO is calculating how much something will cost for the next 20 years - but Congress has not told CBO what the final wording of the legislation will be - right? And Congress won't tell the CBO exactly what the CBO is calculating until the CBO tells Congress how much something will cost. Right? So - the CBO doesn't know what they are calculating - and the Congress won't tell the CBO what it is that they are supposed to be calculating until the CBO finishes it's calculations - Right? I missed that math class!!!

Posted by: jimkearney19761 | March 18, 2010 11:27 AM | Report abuse

Can anyone please confirm or refute the argument made here:

"The plan does two things to refashion the market for health insurance and inadvertently stacks it against these middle-class earners [couples earning $100,000].

First, it limits most consumers to choosing only one of three basic health plans. (These will offer the same basic package of health benefits -- the main difference is that the higher-premium plan has lower co-pays, while the lower-premium one has higher co-payments.) And even the cheapest option -- the "bronze" plan -- will start at about $12,500 for a family, says the CBO.

People buying insurance outside the workplace won't be able to shop around to find cheaper options: ObamaCare effectively outlaws that, because the president wants everyone to have the same package of generous benefits. It's a noble ideal -- but it forces people to buy coverage that may be pricier than what they need, want or can afford.

The individual-insurance market -- which now lets you go to "ehealth.com" and buy a policy directly from Aetna or Wellpoint -- will shut down almost immediately: The regulations ObamaCare puts on the private individual-policy market will simply leave it unable to compete with the new state-based insurance exchanges that the reform creates.

Next, ObamaCare creates powerful financial incentives for employers to drop coverage -- paying a small fee to "dump" employees on the exchange. Because of the new subsidies, the savings -- to the employer and most employees -- will be substantial."

The article alos notes that the proposed subisidies phase out at $100,000 ... is this correct? Will the Obama plan harm families with $100,000 in annual income--which is really not that much since that's just two people each earning $50,000? If not, why not?

If this plan does lead my employer to drop coverage--and why wouldnt it?--my healthcare premiums will double or even triple, especially if we are not given some sort of subsidy (I don't want a subsidy--but if the government essentially forces me to buy my own insurance, i won't be able to afford the additional $5,000-$10,000 a year that would invovvle).

How is this reform? How will this lower health care costs?

Can anyone answer?


Read more: http://www.nypost.com/p/news/opinion/opedcolumnists/middle_class_squeeze_XqHUhXIjnjVB48DYLXhRDK#ixzz0iXfzQXz5


http://www.nypost.com/p/news/opinion/opedcolumnists/middle_class_squeeze_XqHUhXIjnjVB48DYLXhRDK

Posted by: ToughChoices | March 18, 2010 11:31 AM | Report abuse

...."When was the last time the Government didn't underestimate the cost of anything? "
Well, pollution prevention measures for one. In the cost benefits analyses before passage, typically industry provides extremely unfavorable estimates, advocates provide extremely favorable estimates, and neutral parties (eg, government, academia) much more moderate.
After implementation, the final cost-benefit is usually not as rosy as the advocates projected, but still better than the neutral parties.
However pollution prevention measures are kind of a special case because of an "information ratchet" and free-market economics.
Once robust plans are made to implement controls at a certain costs, costs invariably go down as people figure out better ways of doing it.
Once a set of benefits are rigorously identified, other benefits are found (this is kind of obvious in biology: once you find a substance has a discernable negative effect in one body system with a limited set of data, when you look at more data, you find less obvious effects on other body systems.) For example, some pollution control measures paid for themselves before they were even implemented because they forced the replacement of old inefficient machinary.

Posted by: Denswei | March 18, 2010 11:34 AM | Report abuse

The CBO issued a statement this morning rejecting the spin being put out by the corruptocrat dems. The fact that they haven't issued a report as yet is illustrative of the plain, unvarnished truth that the numbers don't help the fraud the Obama admin and dems in control of congress are trying to perpetuate.

What has leaked out is very telling, that this will far exceed 1 trillion dollars in costs and that health care premiums will skyrocket. It's unsustainable and will destroy our economy irrevocably.

As an aside, anyone who pays attention knows that Obama was lying in his statement this morning about his latest jobs scam. A recent survey released by Manpower states that 72% of employers have no plan to hire new workers, irregardless of this latest tax break plan. That 28% of US citizens are unemployed, and that more than half of workers in the US are employed by government.

Ezra Klein thinks we're stupid, and the WashPo clearly believes the same thing. We're not buying it, we reject Obama and the fascists in control of congress and the media.

Posted by: jenn3 | March 18, 2010 11:36 AM | Report abuse

The 31 million insurance identification cards issued in 2014 will be honored by no doctor.

Posted by: etronsen | March 18, 2010 11:37 AM | Report abuse

I'm always amused at these CBO projections, and not just on healthcare. No serious analyst in the private sector would put any stock in a projection running 10, much less 20, years, especially on something as ephemeral as untested social policy. CBO "scoring" is merely a silly game, one played by both sides, that has little if any basis in reality.

Posted by: stratman1 | March 18, 2010 11:43 AM | Report abuse

Sure....let's make a deal. If Pelosi care does reduce the deficit by 1.3 trillion then the supporters of the bill can have a tax break. If the deficit actually goes up as a result of this bill the supporters get a special tax to make up the difference.

Care to make a bet?

Posted by: manapp99 | March 18, 2010 11:46 AM | Report abuse

CBO report should give reluctant House dems the data they need to cast a courageous vote and follow the example set yesterday by Kucinich and President Obama who made the case for health care reform - when he wasn't interrupted - on Fox.

Posted by: mrheinstein1 | March 18, 2010 11:46 AM | Report abuse

Does anyone care to remind us what the CBO score was on the Bush/Republican Congress massive perscription drug bill?

Or how about the Iraq war?

Or the 1.8 trillion dollar tax cuts?

Oh...It turns out all went right to the bottom line of the deficit...All unpaid for...

As any thinking person knows, "small government conservatives", are and always have been simply a myth. What is NOT a myth are rank hypocites in the Republican Party.

Posted by: RonWaggs49 | March 18, 2010 11:46 AM | Report abuse

GIGO: garbage in, garbage out. The CBO only crunches the numbers that congress gives them! I think most people will be
highly skeptical, after what we've witnessed the past year.
Massachusetts' universal healthcare is very similar, and their insurance is Increasing: 8-32% increase will go into affect in April.
New patients have an average wait of 44 Days to see a doctor;
ER visits are Increasing due to the long waits for doctors;
hospitals are going bankrupt.
Everyone needs to look at what's happening
in Massachusetts.
We can't repeat the same mistakes!

Posted by: ohioan | March 18, 2010 11:54 AM | Report abuse

Perhaps if I thought the government could run a passenger railroad, successfully provide obligatory health services to the uniformed military and families or operate within its self-defined budget ONCE, i would begin to entertain the specifics of any sweeping reform proposed by this collection of malingering tax cheats and assorted felons.

Posted by: ascpgh1 | March 18, 2010 11:55 AM | Report abuse

At the beginning of the Iraq war, I read cost estimates of about $200 billion, with a wide range of uncertainty ranging from $0 (using oil revenue from Iraqi oil fields), up to $1 trillion.
Last estimate I saw was $2 trillion (after factoring future liabilities like veterns care).
Here the information ratchet worked against us, as once we identified ways to implement our plans for $200 billion, insurgents figured out ways to twart our plans, while the benefits were limited.

Posted by: Denswei | March 18, 2010 11:59 AM | Report abuse

Given that this is not what I could call health care reform- it does not decrease the *cost* of Medicare or insurance, your headline basically says to me that this bill increases taxes by $1.3 trillion plus the 20 year *cost* of the bill. HFS...

Posted by: staticvars | March 18, 2010 12:00 PM | Report abuse

If the Libs/progressives in these posts weren't so dangerous to our Founders concept of America, (i.e., small government, personal freedom and liberty) they would be hilarious in their ignorance and shear foolishness.

Posted by: christinekm | March 18, 2010 12:02 PM | Report abuse

ToughChoices,

Keep in mind that the legislation will have only a marginal impact on large group plans; Medicare won't be impacted (except for those in privately managed Medicare Advantage, which costs taxpayers $1.20 for every $1 of Medicare spending).

Essentially that leaves a little less than 25 percent of the market that could see profound improvements in their coverage in the rough-and-tumble individual market.

If you currently work for a small business with 50 or fewer employees, in theory that employer could transition you to one of the insurance exchanges when they become available. But keep in mind, with continued rate increases in the small group market, there's a pretty good chance that you would be dumped into the individual market anyways in the next decade absent health care reform.

At least with the Senate bill in place, you would be put into an individual market that has consumer protections, where plans are more affordable, and where you can't have your coverage canceled, or be denied a coverage plan because of pre-existing conditions.

How does the reform lower cost?

On an individual level it lowers costs because of mandates (e.g. more healthy people who don't have insurance will be paying into the insurance pool -- this has the net effect of lowering costs for everyone currently in the insurance pool).

The measure contains a "medical-loss" spending provision which puts limits on the amount of spending that insurers can spend on things like advertising and profit-taking -- it requires that more money be spent on medical care (e.g. 80 percent of revenue must go toward providing health care).

The program also includes subsidies for families with $88,000 or less in income in order to purchase insurance (meaning that they can afford a better plan than they would otherwise be able to).

The federal budget savings come from a combination of tax increases on high cost insurance plans starting in 2017, and on Medicare recipients in top income bracket.

It also includes spending cuts in programs like Medicare Advantage.

There are some budget potential savings in some of the experimental programs that the bill includes as well (e.g. electronic medical records, experiments with different kinds of incentive systems for doctors to provide high quality care at a reasonable cost).

Posted by: JPRS | March 18, 2010 12:16 PM | Report abuse

So, we have a bunch of people here who suggest that the system is working? Nope. A bunch who have ideas on how to fix the system and, as you say, "any three year-old can see if broken?" Nope. We have a load of people of looked at the first CBO estimate last summer (over $1T with a ten-year addition of $150B to the federal deficit) and touted that study as proof that we were spending, spending, spending. Yet, even if you take away the 10-20 year number, the CBO estimate is now worthless? It wasn't worthless when it said what you wanted.

If you don't have a solution or idea - aside from being petulent losers - take your crayons and go color in the corner. We're better off without you.

Thanks

Posted by: saintex | March 18, 2010 12:19 PM | Report abuse

If the Libs/progressives in these posts weren't so dangerous to our Founders concept of America, (i.e., small government, personal freedom and liberty) they would be hilarious in their ignorance and shear foolishness.

Posted by: christinekm

/////////////////////////////////

The kind of "liberty" that you worship is the liberty of the super-rich to do whatever the h-ll they want to everyone else. Effectively that is what's happening right now in the individual insurance market.

As James Madison said in Federalist 10:

So strong is this propensity of mankind to fall into mutual animosities, that where no substantial occasion presents itself, the most frivolous and fanciful distinctions have been sufficient to kindle their unfriendly passions and excite their most violent conflicts. But the most common and durable source of factions has been the various and unequal distribution of property. Those who hold and those who are without property have ever formed distinct interests in society. Those who are creditors, and those who are debtors, fall under a like discrimination. A landed interest, a manufacturing interest, a mercantile interest, a moneyed interest, with many lesser interests, grow up of necessity in civilized nations, and divide them into different classes, actuated by different sentiments and views. The regulation of these various and interfering interests forms the principal task of modern legislation, and involves the spirit of party and faction in the necessary and ordinary operations of the government."

The notion of balancing interests and reigning in abuses is one of the functions of government.

This notion that providing universal health care, or near-universal health care is incompatible with democracy is contradicted by the fact that EVERY major industrialized democracy with the exception of the U.S. currently has a universal system of health care for the population.

As libertarian economist F.A. Hayek said in 1945:

"There is no reason why, in a society which has reached the general level of wealth ours has, (the certainty of a given minimum of sustenance) should not be guaranteed to all without endangering general freedom; that is: some minimum of food, shelter and clothing, sufficient to preserve health. Nor is there any reason why the state should not help to organize a comprehensive system of social insurance in providing for those common hazards of life against which few can make adequate provision."

Posted by: JPRS | March 18, 2010 12:24 PM | Report abuse

Thank you, JPRS,

But I do not see anything in your statement--other than the statement itself--to support the idea that large group plans will be unaffected ... why do you think so? Once the health exchanges are in place, why won't somewhat larger firms (I work at one with more than 50 employees but fewer than 500) decide it is cheaper for them to pay a penalty and dump their health care costs by sending us to the exhanges? At which point, the portion of my current premiums that I pay--roughly $5,000--would at least double or even triple since I would now have to pay the entire cost and would receive no subsidy? In addition, previous changes to healthcare laws mean that I can't be denied coverage for preexisting conditions anyway since I was already covered for such conditions under my current insurance plan--so that "change" in the proposed bill doesn't give me anything I didn't already have. I don't know about you, but as for me suddenly paying an additional $5,000 to $10,000 in premiums won't exactly be "reform" (I do not actually want a subsidy--what I want is for the government to not screw up my family's healthcare, whcih I very much fear they are going to do if this bill passes ...)

Posted by: ToughChoices | March 18, 2010 12:47 PM | Report abuse

Soo, if this does not come to pass, may we expect compensation from the people in the CBO responsible for these predictions, or from their children? Or is the normal disclaimer involved?

Most of the savings is by pushing everything to other sources. 500 BILLION is being taken out of Medicare, which according to Obama is going to make that fund more secure, while most competent economists without a liberal agenda to spin agree that 500 BILLION will mean that Medicare will be drained and insolvent 5 years SOONER than it already will be. That is within 20 years now, folks and is NOT addressed in this CBO estimate, because those who asked the questions (the Democrats in control of Congress) already had a fair idea of the answer, and did not want it "officially" reported. If you are 30 or so, kiss Medicare Goodbye, and hope like hell that you really CAN afford good health care when you get old. There is not any likelihood that they will raise taxes that extremely to get this solvent again.

States will see LESS money to support MORE Federally Mandated Coverage. Why do you think that Ben Nelson's deal was such a sweet one? That saves a lot of FEDRAL MONEY, but you and I will HAVE to pay it at the STATE Level instead. On top of that, costs are pushed to those making more than 133% of the poeverty level. Are you a household of 4 making $88,200 per year? Expect 17% of that GROSS Income to go for paying for Premiums ONLY. Any copay if you actually SEE a doctor will cost more.

Gee, this sounds so very good, doesn't it?

;'{P~~~

Posted by: Clearbrook | March 18, 2010 12:51 PM | Report abuse

One sentence: Look at Massachusetts' universal healthcare.

Posted by: ohioan | March 18, 2010 12:54 PM | Report abuse

The CBO has NEVER overestimate the cost of any program.

Expect the cost to be at least 3 times and more likely 10 times the CBO's estimate.
Thus, the true cost is 10 trillion dollars. With a little help from BO and his congress, you can bet it will go even higher. Perhaps the taxpayers will run BO and his boys out and resend this catastrophe.

The CBO tells the lie that their paymasters demand.

Posted by: Tony27 | March 18, 2010 12:58 PM | Report abuse

The CBO estimate, BTW, is based upon *very* Rosy Economic Projections, which although they MAY be true, are not at all in line with the current reality. IF GNP grows at average the rates it did in the 8 years under Bush, (since the Democrats want to bash him, I'll go there) it won't happen. If you say use the Clinton years average, guess what? Their numbers are *Still* rosier than that reality, which was overall better than Bush's 8 years. Go back to the BEST YEARS ONLY, not all of the years, of Bush, Clinton or Regan (who overall did even better than Clinton) and THEN their predictions are accurate, if that is a reasonable basis.

Does anyone REALLY expect 20 years SOLID of that kind of growth? I think to make predictions on that basis is wrong, and even criminally negligent! At the very least, it is totally unprofessional!

Granted, I am assuming that this estimate used the same sort of numbers for economic growth that all the previous ones did. That DOES remain to be seen. But they HAVE used the same numbers that favor the Democrats all the times before, and I see nothing to indicate they have withdrawn from that irrational economic prediction. It is also true that they may have even sweetened the numbers just a little bit more! After all, what are we going to do? Sue them for their incompetance? The Democrats hire and fire these jokers right now. They sign their paycheck. They are not beholding to the truth anymore than anyone in Congress is!

Posted by: Clearbrook | March 18, 2010 1:04 PM | Report abuse

Yup, "personal freedom and liberty to the highest bidder". As if the founding fathers & followers fought for that as opposed to "personal freedom and liberty to the well-born nobility".

Posted by: Denswei | March 18, 2010 1:04 PM | Report abuse

Hello????????????HELLO????????????

The CBO has NOT even seen the final bill. This is a complete sham! They already said they couldn't evaluate the bill because it was not done and far far too complex. However, when you are told what to do because Obama needs a few more votes to get it to pass, you do what your told or else. Insiders just accept these things as part of the game, but it shameful that the media has litterally no true investigative journalists left.

If we want to know what it will cost, we can just use Medicare or Medicaid as our base denominator in projecting out what this will cost......while keeping in mind that NO Gvt. program has EVER come in on budget - we can then determine how much this will cost.

When the REAL bill is actually DONE BEING WRITTEN, it will be revised to about $1.2 Trillion - then we can apply our Medicare/Medicaid formula and come close to the real cost..... $6
Trillion.........thats in dollars.

However, since it takes 4 yrs to FULLY kick in, we will never know. We do know that denying someone for pre-existing conditions kicks in right away. That will bankrupt EVERY insurance company....again, by design. Unfortunately, we won't even get to 2012 before the economy crashes next year, then we have to refigure it all again, this time in Amero's.

Lastly, you people complaining about the rich are killing me. Who do you think this Bill helps, the little man? Really? Who do you think gives Obama his orders? No, its not Michelle!

This is NOT a bill about Healthcare people. This is about (The super rich/Those in power- you know, the ones you love to hate) being able to control EVERY aspect of each and every Americans life......and your jumping up and down about it!!!

You & I are in for a big big BIG surprise!
The rollar coaster has just reached the crest, so get ready or
Bend over,Dig hole, insert head, cover with sand, go back to whining about the rich, while they prepare to make an entrance from the rear.

Posted by: jsmappy | March 18, 2010 1:12 PM | Report abuse

Hey Ezra,Paragraph 2 states that 95% of the legal population is 32 million,is this saying the other 200 million +/- are illegal

Posted by: Doobert | March 18, 2010 1:31 PM | Report abuse

I bet the 500b medicare fraud reductions are counted as income in the 940b. The problem is that the fraud should have been stopped on day one. It is already illegal.

Government is NEVER under budget so we can realistically expect a much higher cost than 940b. SS, Medicare/medicaid and Part D are in big trouble. This healthcare is only raising taxes to cover these programs.

If some action cuts cost than why does that action cost money. This is nothing more than an increase in personal TAXES and coupled with budget cuts makes the healthcare plan look like it makes money. The reality is it COST money every year because it is coming from someone's wallet.

Posted by: Wisconsin1 | March 18, 2010 1:40 PM | Report abuse

So who are the unlucky 5% who DON'T get coverage? I think they will want to know prior to the mid-term elections so they can vote appropriately.

Seriously, why wouldn't EVERYONE be covered PERIOD from the getgo?

I am also waiting for someone to tell us whether or not the "reforms" in this bill do not go into effect until 2014 or not.

If nothing happens until 2014, someone is going to have to do a lot of explaining.

Posted by: JackJo | March 18, 2010 2:12 PM | Report abuse

Look at what they cut from Medicare. If you scan through the CBO numbers...$478 million is being cut from Medicare.
If you put back this $478 million the bill is not deficit neutral. $138 - 478 = -340 millions. It will costs an additional 340 million.
These guys are good liars with numbers.
Obama is now sacrificing the need of old people

Posted by: fencer1 | March 18, 2010 2:14 PM | Report abuse

Eh, I've got my doubts. They are fudging the numbers to make it look good. If I told you I'd work for you for ten years for a certain salary, and you had to start paying me right away, but I was only workin' for the last 6 years, you'd tell me to get lost. Same thing here.

This is going to cost a lot more than 940 billion. They are basically spending trillions to save 168 billion. I am just a simple hillbilly, but I know a pig in a poke when I see one.

I have friends in Australia who are now required by law to carry their own private insurance in addition to the universal care they have their. The sytem has already run out of money there, and they only have a total population of 30 million.

I also have friends in England and Sweden who carry private insurance to fill in the gaps that the universal care does not cover, and it doesn't cover much.

You never hear these things on the news when they talk about how "good" the coverage is in other countries.

Posted by: JolieFleur | March 18, 2010 3:38 PM | Report abuse

Anyone who believes that a CBO number which takes 10 years of taxes and 4-6 years (numbers vary from bill to bill) of benefits spending is a legitimate number probably went to school in California.

The only way they could get a CBO score better than they were expecting was for Democrats to start the tax increases (meant to pay for the program) 4-6 years ahead of when the spending kicks in.

If you have even the slightest knowledge of mathematics you must realize that starting in the 11th year, spending will outpace income. So the 20 year projection of deficit reduction is flat out wrong.

Finally, when has a single government projection of costs ever been the same or lower than estimated? NEVER! Wake up. These people are spending OUR money and making themselves exempt from the legislation. We are witnessing tyranny at its finest.

Anyone who votes for this health care bill must be voted out of office in 2010, regardless if it passes or not. It is the only clear message we can send that they will HAVE to listen to.

Editor
FedUpNetwork

Posted by: FedUpEditor | March 18, 2010 3:41 PM | Report abuse

ToughChoices,

Large firms are prevented by law from shifting employees into the exchanges -- there are restrictions based on size and revenue. (e.g. a mid-sized firm with 250 employees and $10 million in operating revenue would not be eligible to purchase insurance from the exchanges).

Part of the reason for the restrictions is that the large group insurance market works pretty well; employers also like the tax benefit that they get from providing coverage. Insurers are able to turn a profit without cherry-picking since risk is spread widely throughout the pool.

In the case of a small business with say 10 people if someone gets cancer the costs associated with that one group go through the roof, so insurers have an incentive to drop everyone. This piece of legislation would protect those 10 employees and their employer by putting them in an insurance pool where the costs are distributed more widely.

From your employers point of view, if they dumped your coverage:

1. They would lose a generous tax exclusion on health care benefits.

2. They would be inviting competitors within their industry to poach their best employees.

The odds of either of these outcomes happening are unlikely.

Another way to look at this: If you or your spouse lost your job someday and you had to become a temporary worker or an independent contractor -- meaning that you had to purchase insurance through the individual market -- you would be MUCH better off under the proposed legislation than what exists today.

The odds of a person getting fired in this economy are higher than the odds of a large employer dumping the entire company's health insurance coverage.

Posted by: JPRS | March 18, 2010 5:20 PM | Report abuse

FedUpEditor,

Your reasoning makes absolutely no sense. The CBO factors in the timing of the tax hikes as part of its calculation.

This is one reason that it projects $130 billions of saving in the first decade and $1.2 TRILLION in the second decade. A major part of the reason is due to the fact that many of the tax hikes are delayed (e.g. the tax on high cost insurance plans).

There are also spending CUTS which are part of the program (e.g. to Medicare Advantage).

You also have x-factors including experimental programs which could create additional savings.

Now it could be that the projections will be off -- they probably will be off. They are projections, not statements of fact.

But even assuming that the projections are off, it is pretty revealing that you would automatically assume that the CBO's position must actually cost much more than they are saying it will.

History seems to show that the CBO is actually pretty conservative in its assumptions when it comes to health care policy, so it's entirely conceivable that the CBO could be low-balling the actual savings.

Medicare enacts the prospective payments system (PPS) for reimbursing inpatient hospital stays.

-- The CBO projected total Medicare spending will rise to $60 billion in 1986.

== Actual Medicare spending in 1986 was only $48 billion.

Medicare begins paying skilled nursing facilities and home health care services a set fee per patient.

-- The CBO projected a 9.1% reduction in Medicare spending.
-- The actual savings turned out to be 50 percent greater in 1998 and 113 percent greater in 1999 than the budget office forecast.

The Medicare Modernization Act created Part D prescription drug coverage.

-- The CBO projected that spending on the drug benefit would be $206 billion.
--Actual spending was nearly 40 percent less than that.

http://www.nytimes.com/2009/08/26/opinion/26gabel.html?_r=2&ref=todayspaper&pagewanted=all

In other words, your position is based on prejudice, not the historical record.

Posted by: JPRS | March 18, 2010 5:42 PM | Report abuse

The CBO cover letter for the report indicates that their figures are preliminary to a full review.
From their letter: "Although CBO completed a preliminary review of legislative language prior to its release, the agency has not thoroughly examined the reconciliation proposal to verify its consistency with the previous draft. This estimate is therefore preliminary, pending a review of the language of the reconciliation proposal, as well as further review and refinement of the budgetary projections."
Ten year projects on a bill still being refined have no real validity.

Posted by: jfsanford | March 19, 2010 10:36 AM | Report abuse

JPRS, thanks for you optimism regarding the CBO's calcs. Any similar optimism regarding the GAO's calc's of our nation's unfunded liabilities of >$75T?!

For perspective, $75T is 30 times our government's current annual revenue, due TODAY, just to get us back to EVEN, WITHOUT the current healthcare bill. Since our taxes fund the government's revenue, every taxpayer's responsibility is 30 times (their annual income tax + (both halves) their social security/medicare taxes). DUE TODAY.

So just how impressed should anyone be with proposals that don't even spit at the problem?

P.S. $75T is pretty close to the point where with 3% time value of money even doubling our taxes today won't paydown the burden.

P.S.S. So then, what likely are the motives of elected officials who mislead the nation about our real State of the Union, and by action pretend none of this exists?

Posted by: PursueTruth | March 19, 2010 2:22 PM | Report abuse

Thank you, Mighty7, for reminding us why we must be forever grateful to Republicans, who refuse to believe in ridiculous Marxist fairy tales, such as the funny one that says that you can insure millions more people and save money.

Republicans understand that the CBO "findings" are based on the smoke and mirrors provided by Obama and his comrades to the CBO. Garbage in, garbage out; smoke and mirrors in, smoke and mirrors out.

Republicans have said NO to the manipulations and BRIBES of Obama and his comrades. The have had the courage and integrity to say NO:

NO to Marxist scams like Obamacare and cap and trade
NO to higher deficits that are destroying the future of our children and grandchildren
NO to government takeovers
NO to siding with terrorists and helping them at the expense of American people
NO to having the corrupt United Nations deciding what the U.S. should and should not do
NO to Saul Alinsky's culture of lies, manipulation, intimidation, coercion, bribery, fraud, corruption and death
NO to trampling on the U.S. Constitution
NO to imitating the strategies of the Marxist thugs who are destroying Latin America
NO to all of Obama's scams that are destroying America
YES to REAL reform to improve health care
YES to fiscal and personal responsibility
YES to governments of laws rather than of men
YES to defending Americans from terrorists and other U.S. enemies
YES to respecting the U.S. Constitution
YES to energy independence
YES to freedom, including freedom OF religion (not FROM religion)
YES to patriotism

Posted by: AntonioSosa | March 19, 2010 3:18 PM | Report abuse

Ezra Klien from the Washington post reported 3-18-10, that the proposed bill would cut the deficit by 1.2 trillion dollars between 2020-2029. However on pages 3-4, of the letter the CBO sent Nancy Pelosi 3-18-10, the summary states that it would save only one half of one percent of GDP. The 2008 GDP was 14.3 trillion dollars, 0.5% of that is only 71.5 billion dollars. Ezra Klien's article overstates the CBO's deficit reduction prediction for the second decade by 1700%. The letter to Nancy Pelosi also highly qualifies those estimates as imprecise and states that they are based on a draft version of the proposed legislation and not the final draft as the final version was just released 3-18-10.

http://www.cbo.gov/ftpdocs/113xx/doc11355/hr4872.pdf

Posted by: Radnet | March 20, 2010 5:48 PM | Report abuse

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