CBO Says Senate Health Bill May Cut Cost for Many
The Congressional Budget Office said Monday that the Senate health bill could significantly reduce costs for many people who buy health insurance on their own, and that it would not substantially change premiums for the vast numbers of Americans who receive coverage from large employers.
The eagerly awaited report, which came as the Senate began debate on the legislation, provided Democrats with ammunition against Republicans who have criticized the bill on the ground that it would raise costs for a majority of Americans.
Moderate Democrats whose votes are vital to President Barack Obama’s hopes of getting the bill through the Senate, like Sen. Evan Bayh of Indiana, had feared that the bill would drive up costs for people with employer-sponsored coverage. Bayh issued a statement saying the report reassured him on that point.
Before taking account of federal subsidies in the form of tax credits that would benefit many people who buy health insurance on their own, the bill would tend to drive up premiums, the budget office said. But including the subsidies, which would cost the government nearly $450 billion in the next 10 years and on average cover nearly two-thirds of the total premium charged to people buying insurance on their own, more people would see their costs decline than would see them rise, the budget office said.
For most people who get health insurance through employers — five-sixths of the total market — the budget office concluded that there would be very little change in their premiums relative to projections under current law.
Administration officials said the report provided a lift to the bill, which embodies Obama’s top domestic priority.
“The CBO has rendered a fundamental judgment that this will reduce the deficit and reduce people’s premium costs,” said Rahm Emanuel, the White House chief of staff, who met with Senate Democratic leaders on Capitol Hill on Monday. “All the Republican leadership will guarantee you is the status quo.”
But Republican senators like Charles E. Grassley of Iowa and Mitch McConnell of Kentucky, the minority leader, said the report validated their concerns. They focused on the prediction that unsubsidized premiums in the individual insurance market, representing a relatively small share of those who have health insurance, would rise an average of 10-13 percent.
“The analysis by the Congressional Budget Office confirms our worst fears,” Grassley said. “Millions of people who are expecting lower costs as a result of health reform will end up paying more in the form of higher premiums. For large and small employers that have been struggling for years with skyrocketing health insurance premiums, CBO concludes this bill will do little, if anything, to provide relief.”
The Senate majority leader, Harry Reid, Democrat of Nevada, said the highly partisan floor debate that opened Monday afternoon was one of the most significant in the history of the Senate. It is expected to continue for much of December, with supporters and opponents alike offering a raft of amendments as the White House and Democratic leaders seek to cobble together the 60-vote coalition necessary to win passage.