CBO: Health Reform Plan by Senate HELP Panel Would Cost $1 Trillion

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The Senate Health, Education, Labor and Pensions Committee health reform legislation would cost the government an estimated $1 trillion over the next 10 years while reducing the number of uninsured U.S. residents by about one-third, or 16 million people, according to a preliminary Congressional Budget Office estimate released on Monday, the AP/Boston Globe reports.

The estimate was based on an incomplete draft of the bill, according to the AP/Globe.

In a letter to committee Chair Edward Kennedy (D-Mass.), CBO Director Douglas Elmendorf wrote that if the bill were "fully implemented, about 39 million individuals would obtain coverage through the new insurance exchanges," but that the number of people with employer-sponsored coverage would decline by about 15 million and "coverage from other sources would fall by about eight million," resulting in a net decline in the uninsured population of about 16 million (Espo, AP/Boston Globe, 6/16).

According to the report, many U.S. residents would opt for coverage through the exchanges because they would qualify for federal subsidies averaging $5,000 to $6,000 per person, which would not available to people with employer-sponsored health coverage.

If fully implemented, 36 million U.S. residents would remain uninsured in 2017, according to CBO (Pear/Calmes, New York Times, 6/16).

The report also estimates that the percentage of uninsured U.S. residents younger than age 65 would decline from 19% in 2010 to 13% in 2019 (Armstrong, CQ Today, 6/15).

The report states that "because expanded eligibility for the Medicaid program may be added at a later date, those figures are not likely to represent the impact that more comprehensive proposals -- which might include a significant expansion of Medicaid or other options for subsidizing coverage for those with income below 150% of the federal poverty level -- would have both on the federal budget and on the extent of insurance coverage" (Bolton, The Hill, 6/15).

Comments

Kennedy spokesperson Anthony Coley said, "In our effort to find common ground with our Republican colleagues, the majority on the HELP Committee filed a bill with blank spaces to allow time for more bipartisan consensus to develop. We knew that this process would produce this estimate," adding, "The preliminary analysis that CBO has provided of this proposal has highlighted the importance of filling in those blanks and we will fill them in the upcoming mark up. Doing so will lower the bill's overall cost" (Montgomery, "Daily Dose," Washington Post, 6/15).

White House press secretary Robert Gibbs distanced the Obama administration from the Kennedy proposal. He said, "This is not the administration's bill, and it's not even the final Senate committee bill," adding, "What is clear is what will happen if we let political posturing stand in the way of reform again: exploding deficits, job loss, dwindling benefits, and millions more Americans joining the ranks of the uninsured. That's unacceptable, and that's why stakeholders from across the spectrum are joining with President Obama to enact health care reform that finally gets costs under control and expands coverage -- without adding to our deficit" (Budoff Brown, Politico, 6/15).

In a statement, Senate HELP Committee ranking member Mike Enzi (R-Wyo.) said, "These early reports from CBO show that this bill will cost too much, cover too few, and cause too many to lose the coverage they enjoy now," adding, "As I have been pleading with my colleagues for many months, today's report clearly shows that it's time to go back to the drawing board and work on a bipartisan plan that will ensure access to affordable care for all Americans" (Phillips, "The Caucus," New York Times, 6/15).

A GOP aide said, "This is significantly higher than they expected," adding, "I think anytime you hear folks on the Hill make an approximate estimate that wide, they're expecting to come in on the low end. They're not expecting it to top out" (The Hill, 6/15).

Timeline

The Senate HELP Committee is scheduled to begin marking up the bill on Wednesday.

Sen. Christopher Dodd (D-Conn.) will preside over the meeting in Kennedy's absence (Drucker, Roll Call, 6/15).

The mark up of the bill is expected to continue daily through June 26 (CongressDaily, 6/15).

Senate Finance Committee leaders likely will unveil their reform bill on Wednesday (New York Times, 6/16).

Hearings for both committees' bills have been delayed.

According to Sen. Charles Schumer (D-N.Y.), "One of the things that has held things up a little bit is (the need) to get the CBO estimates" (The Hill, 6/15).

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