What Does the Congressional Budget Office Say About Health Care Reform?


In a column on health care today, E.J. Dionne argues that the Congressional Budget Office has cleared the way for reform:

The core issues of this debate have been settled. The Congressional Budget Office has swept away the major arguments that opponents of reform have been trying to make. The bill before the Senate would cut the deficit, not increase it, and would stabilize or reduce health care premiums for most people, not raise them. The proposal contains serious cost-control measures that can be built on over time. Passing health care reform is thus not only morally necessary, but also fiscally responsible.

These are certainly the numbers that have gotten the most play in the press. But looking a little closer, I'm not sure CBO confirms any of this.

On deficit neutrality, the CBO has warned strongly on repeated occasions that there's a long history of Medicare reimbursement cuts not coming to pass, and that the bill's score would change substantially if that were to happen once again (which many believe is likely). The CBO has also explicitly stated that if you include the legislative fix to the last round of failed reimbursement cuts—as House Democrats did in their original bill—the total effect on the deficit is decidedly not neutral.

And while it's true that the CBO expects premiums for those who receive insurance through their employers to stay roughly flat, the CBO also expects premiums in the individual market—the market that this bill was primarily intended to reform—to jump significantly. Any premium reductions in that market would come through taxpayer-funded subsidies, not through reform's magical shrinking effect on premiums.

Moreover, the CBO simply hasn't said that the bill's cost-control measures are likely to pay off. If anything, it's said the opposite. Over the summer, CBO chief Doug Elmendorf said he believed the reform bills he was seeing at the time would bend the cost curve in the wrong direction. Since then, the CBO has taken the official position that it can't evaluate one way or another. But given that 1) the major components of the bills are largely the same now as they were this summer and 2) Medicare's actuary has stated that reform is likely to increase costs, I think it's more than reasonable to be skeptical of any claims that the bill will reduce medical spending.

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  1. “The core issues of this debate have been settled”

    The science is settled.

    1. Exactly. Sounds just like the global warming debate, doesn’t it?

      1. The slovenliness of our language makes it easier to have foolish thoughts.

        – George Orwell

  2. The CBO has never been proven to be accurate in estimating the cost of ANY entitlement program that has ever been enacted in this nation’s history.

    They massively underestimated the cost of Medicare.

    1. Link? CBO didn’t exist when medicare was created, so I find this pretty hard to believe.

    2. Are you as stupid as you appear. Seems I remember a post you made about the moon walk was filmed in a studio and President Bush was spotted wiring the trade center. You should go to work as a cub reporter under the tutelage of MSNBC”s keith Oberman.

  3. Let’s grant that rainbows do come out of unicorn’s asses and pretend for a moment that the medicare cuts will happen. That means that fewer doctors will take medicare and give less service when they do. That means we are forcibly rationing care. We are reducing care for the old and the sick and using the assets to fund a bureaucracy and cover “the uninsured” whoever they are.

    In the end, all liberal healthcare reforms come down to that basic proposition; kill the old and the sick to use the resources elswhere.

    1. California has ended subsidies for mammograms for poor women between 40-50 years of age, and will also freeze enrollments in a breast-cancer screening program for its Medicaid recipients.

      The eligibility age for state-subsidized breast cancer screening has been raised from 40 to 50 by the California Health and Human Services Agency, which will also temporarily stop enrollment in the breast cancer screening program.

      Advocates for low-income women, whose health care the department helps pay for, say the cuts put a two-tier system in place that is based on money rather than medical standards.

      The cuts will greatly harm the clinic’s mammogram program, said Natasha Riley, manager of Vista Community Clinic’s Breast Health Outreach and Education Program.

      The clinic and others like it in San Diego County provide reduced-cost care, mostly to low-income people, with money from the state and some private donations.

      “More than 50 percent of the women we give breast exams and mammograms to are in their 40s,” Riley said. “The majority of our current breast cancer survivors are women in their 40s.”


  4. That’s Progressive, John. Liberals actually do care about the old and the sick. They’re just OK with taking your money to pay for it. In fact, it’s arguable they prefer everyone be old and sick because then we’re all equal.

  5. What the CBO says is academic at best. Even if this “reform” is as magical as they claim, there is nothing to stop the government from changing the law in the future. To deal with some new “crisis”, of course.

  6. Wait. I thought the only reason it was deficient neutral was because they spun the medicaid reimbursement freeze into its own bill.

    So the CBO can say that this bill is neutral, but the only reason it’s close to passing is because congress with paying off the docs with another bill.

    Or did I miss something?

  7. Assumptions matter.

    If I assume I can sell my Porsche for $250k, I can easily justify tearing down my shop and building a nicer one.

  8. The cuts will greatly harm the clinic’s mammogram program, said Natasha Riley, manager of Vista Community Clinic’s Breast Health Outreach and Education Program.

    If the government was going to stop subsidizing my snake oil factory, I’d be shouting “Woooooooolf!” too.

    1. You equate a clinic providing mammograms to the poor with a snake oil factory? Please explain that to the rest of the class.

  9. If you listen to “some” people, there are studies which show mammograms for younger women are ineffective, or possibly even do more harm than good, by subjecting some women to unnecessary surgery (not to mention mental anguish).

    Anybody whose business plan is based on getting the government to subsidize their provision of unneeded services is selling snake oil.

  10. I haven’t seen much coverage of the healthcare bill debate in the news this last week, or even here at H&R. However, that which I have seen deals mostly with disputes over cost and the “public option” – almost no discussion of the mandate that everyone be required to buy health insurance. Apparently even the bill’s Republican opposition can get on board with taxing people for the simple fact of being alive – no concern or disagreement about that. In other words, healthcare “reform” will be passed and Americans will get screwed – the only argument seems to be over which party and special interests get the benefits of that screwing.

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