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CBO: Baucus Proposal Would Save $49 Billion Over Ten Years

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jefferson_dem Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 06:58 PM
Original message
CBO: Baucus Proposal Would Save $49 Billion Over Ten Years
This is good news.

While Baucus's bill is still a pig, the CBO estimate shows that "reform" can be deficit friendly...or deficit neutral at least.

CBO: Baucus Proposal Would Save $49 Billion Over Ten Years

While liberals, insurance companies, Republicans, unions, governors, and universal coverage fans have all come out opposed to Senate Finance Committee Chairman Max Baucus's health reform bill, it does have one thing going for it: the Congressional Budget Office and Congress's Joint Committee on Taxation estimate that it will save $49 billion over the first ten years of implementation, if it were to go into effect in 2010.

The CBO and JCT released their preliminary analysis of Baucus's proposal this afternoon (based on Baucus's specifications but a full review of the document he released today). From their analysis (full document here):

Estimated Budgetary Impact of the Chairman's Proposal

According to CBO and JCT's assessment, enacting the Chairman's proposal would result in a net reduction in federal budget deficits of $49 billion over the 2010-2019 period (see Table 1). The estimate includes a projected net cost of $500 billion over 10 years for the proposed expansions in insurance coverage. That net cost itself reflects a gross total of $774 billion in credits and subsidies provided through the exchanges, increased net outlays for Medicaid and the Children's Health Insurance Program (CHIP), and tax credits for small employers; those costs are partly offset by $215 billion in revenues from the excise tax on high-premium insurance plans and $59 billion in revenues from other sources.1 The net cost of the coverage expansions would be more than offset by the combination of other spending changes that CBO estimates would save $409 billion over the 10 years and other tax provisions that JCT and CBO estimate would increase federal revenues by $139 billion over the same period.2 In subsequent years, the collective effect of those provisions would probably be continued reductions in federal budget deficits.

Some of the ways it saves that much money are points of contention for Democrats as well as Republicans (like taxing expensive insurance plans), and many liberals would rather have a bill that spends more to bring more people into the system, but this is something that Baucus is hanging his hat on--especially the fact that $409 billion of its net $539 billion savings come from spending reductions, rather than new taxes.

As health reform moves to the Senate floor for the amendment process, the $49 billion savings will likely frame the discussion of cost, at least initially, as various proposals affect the Senate package's budgetary impact.

http://politics.theatlantic.com/2009/09/cbo_baucus_prop...
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Cant trust em Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 07:07 PM
Response to Original message
1. Interesting. This should at least be a base to go from. nt
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alcibiades_mystery Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 07:08 PM
Response to Original message
2. Good...we can add a $49 billion public plan and come out deficit neutral
Edited on Wed Sep-16-09 07:08 PM by alcibiades_mystery
:evilgrin:
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Cant trust em Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 07:16 PM
Response to Reply #2
3. anyone seen an estimate to how much this would cost?
I know that it would be funded by premiums, but would it itself be deficit neutral?

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jefferson_dem Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 07:16 PM
Response to Reply #2
4. My thoughts...
xactly.
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grantcart Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 07:37 PM
Response to Reply #2
10. the Public Option doesn't cost a thing and if included would drive costs down further

There will be a subsidy for lower income people to purchase health care. They could use that for the Public Option, others in the health exchange.

Inclusion of the Public Option would almost certainly increase competition and reduce costs, thereby increasing, not decreasing savings.
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PretzelWarrior Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 07:16 PM
Response to Original message
5. this proposal screws middle class Americans and gives $$ to insurance.
I don't care if it saves a trillion $, it is bullshit.
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andym Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 07:18 PM
Response to Original message
6. What about the rising cost of insurance?
How does the CBO state that this bill would effect that? With limited competition, it is doubtful that there would be any improvement.
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Jennicut Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 07:19 PM
Response to Original message
7. Of course it would save money, it does absolutely nothing but gives
new customers to the insurance industry.
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BootinUp Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 07:24 PM
Response to Reply #7
8. The estimate that 94% will be covered
under THIS plan is probably so overly optimistic as to be a fairy tale. From what I can tell, people in the real middle class that don't work for huge mega corps will opt to pay the fine since the coverage cost will be too high for them. Not much different than now.
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Jennicut Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 07:34 PM
Response to Reply #8
9. Exactly. Who cares about the deficit...what about the people who will be forced
to pay these ridiculous fines?
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jefferson_dem Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 07:43 PM
Response to Reply #9
13. Obama has pledged that he will not sign a bill that adds to the deficit.
This provides a deficit positive baseline to work from at least.
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Mr. Sparkle Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 07:41 PM
Response to Original message
11. Save 5 billion a year? Would it not be better to pay that money to get more people included! n/t
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phleshdef Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 07:43 PM
Response to Original message
12. In the grand scheme of things, thats not very much.
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ProSense Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 07:46 PM
Response to Original message
14. Public option saves $150 billion.
Baucus with no public option: Costs $856 billion, covers 94 percent of Americans.


HELP with public option: Costs $611 billion, covers 97 percent of Americans


Screw Baucus' bill.

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jefferson_dem Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 07:47 PM
Response to Reply #14
15. Do you have a link for your figures?
Not challenging them, just curious.
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ProSense Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 08:42 PM
Response to Reply #15
21. New HELP Bill Covers 97 Percent Of Americans, Costs $600 Billion
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dionysus Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 08:47 PM
Response to Reply #14
22. to parody the Magistrate: Maam You Are Correct.
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Oregone Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 08:03 PM
Response to Original message
16. Medicare for all would save $350 billion PER YEAR (at least)
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JimWis Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 08:06 PM
Response to Reply #16
17. Yes. Which reminds me - wasn't there talk a month or so ago
about CBO scoring single payer - what happened with that I wonder.
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Oregone Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 08:11 PM
Response to Reply #17
19. No clue. Swept under the rug?!?
Edited on Wed Sep-16-09 08:12 PM by Oregone
Itd be nice if theyd score either Sanders, Dingell or Conyers bill. But the truth would rock this process.

Itd also be nice if they scored a more streamlined Canadian style bill (which would be significantly cheaper than HR 676)
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lumberjack_jeff Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 08:09 PM
Response to Original message
18. ... by shifting the costs onto individuals. n/t
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Joe the Liberal Donating Member (1000+ posts) Send PM | Profile | Ignore Wed Sep-16-09 08:12 PM
Response to Original message
20. Where was all this talk of "deficit neutral" for the 2 wars we are in now?.....
or when Bush gave tax cuts to the wealthy? I didn't hear a word about those having to be "deficit neutral". This country is so backwards, things like health care that are supposed to help people HAVE TO be "deficit neutral". Things like war and tax cuts for the top 1% can be rammed through with no regard for the deficit whatsoever, what a joke.

Baucus can take whatever bill he writes up and cram it up his ass, anything coming from him won't be anything worthwhile.
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