CBO Initial Estimates of Health Reform
The cost of health care reform is hugely important. But even more important, legislatively speaking, is the CBO’s estimates of cost, since that’s what binds legislators. Jon Cohn reports on their preliminary work:
The good news for reformers is the CBO’s determination that expanding health-insurance coverage would cost a lot less than many outside experts had predicted. Instead of a politically daunting $1.5 trillion, the CBO figures the price tag will be closer to $1 trillion, at least under certain parameters. But the reason for the lower estimate is a bit unsettling. Even with a requirement that everybody obtain insurance–a so-called individual mandate–the CBO assumes a that between a quarter and a third of the uninsured still wouldn’t have coverage. That would leave the country short of universal coverage, the goal Obama and his allies have repeatedly cited.
Also:
The same sources who provided these numbers say that CBO is also tipping its hand about a few other things–like whether information technology, data on the effectiveness of treatments, and other delivery reforms can save money and whether the money people pay for insurance should count as a tax. But, in those cases, the deliberative process isn’t as far along. Instead, CBO officials and staff are consulting widely–with congressional staff, outside experts, etc.–about how to make assessments as fairly and accurately as possible.
Reformers are going to be pushing for forward-leaning estimates of the savings available through delivery reform. The CBO has traditionally been hesitant on that score, but I don’t believe they’ve ever looked at the issue in such an intensive and detailed way. I’ll just note that I think it was a shame that so much high dudgeon was expended on catigating Barack Obama’s mandateless primary-era plan for failing to achieve universal coverage when it turns out that a mandateful plan doesn’t achieve it either.
20 Responses to “CBO Initial Estimates of Health Reform”
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May 16th, 2009 at 5:45 pm
I thought that fixing healthcare would be, on net, cost efficient. Is there any way to capture that by expanding the scope of the CBO’s review (including projecting out a couple years)? If all the savings gained by replacing large private expenditures with smaller public expenditures, is there some way to show that in concrete numbers?
May 16th, 2009 at 5:54 pm
Given Obama’s recent flip flops, that whole primary looks pretty damn pointless all around.
May 16th, 2009 at 5:54 pm
What’s the basis for the determination that “the CBO assumes a that between a quarter and a third of the uninsured still wouldn’t have coverage”? Seems to me that in places where an individual mandate has been established – Massachusetts for example saw 85% of the uninsured get coverage – the number of residual uninsured is well below that.
May 16th, 2009 at 5:54 pm
A mandateless plan would have more people uninsured and lets not be confused. Obama used his lack of a mandate to accuse Hillary of trying to force people to buy insurance they couldn’t afford. The problem with leaving out a mandate is that more people wouldn’t have health insurance and that in principle its not good to ban preexisting conditions if people can go without coverage until they get sick.
May 16th, 2009 at 7:17 pm
I’m with Southpaw. Isn’t the whole point of health care reform to reduce costs?
May 16th, 2009 at 7:27 pm
No, the point of health care reform is to A. get people access to health case, and B. get people healthy, and C. reduce costs. It’s there, but it’s not the “whole” point.
May 16th, 2009 at 7:48 pm
No, the point of health care reform is to raise taxes on the middle class while institutionalizing and expanding health care rationing and outright denial of care.
May 16th, 2009 at 8:04 pm
At 150 million taxpayers, doesn’t that come to about $7,000 down payment per taxpayer? What private insurance company requires $7,000 initial payment?
I thought public health care reform was going to be competitive?
May 16th, 2009 at 8:31 pm
Steven Atttewell makes sure to cover his bases before forcing us all into his vision, since the results of the Massachusetts experiment, with its exploding deficits, shows us that UHC doesn’t come anywhere close to controlling costs. Nope, you’re stuck with plain-old moralistic arguments to people who disagree with you.
May 16th, 2009 at 8:41 pm
25 to 33% of the uninsured remaining without coverage? That’s 12.5 to 17 million people.
Senator Chuck Grassley and Gail Wilensky want nonprofit community hospitals to lose their tax exemption. Guess who will shoulder the burden of the 15 or so million without coverage?
Meanwhile Rick Scott’s Citizens for Patients Rights holds on to its tax exempt status.
Health care deform is coming.
May 16th, 2009 at 10:15 pm
No, the point of health care reform is to raise taxes on the middle class while institutionalizing and expanding health care rationing and outright denial of care.
Don’t be an idiot. Do you think for a second that this is the point? Rather than a potential negative side effect? Did you think that this was a joke? It fails as a joke because it isn’t the least bit funny. Not in poor taste not funny, but just not even evident that it was meant to be a joke. Health care reform will probably make a lot of people who are happy with their own health care worse off. They will pay more. They might get worse coverage. So. Right now the situation is worse. The united states spends a huge amount of money on health outcomes that are largely inferior than other nations. The big reason for this is that you can spend a lot of money to keep a rich man treading water and die at 80 instead of 78 but it takes comparatively little money to have a poor man not die at 58 and instead live to 74.
May 16th, 2009 at 10:34 pm
You have to forgive JT, he isn’t up to an adult discussion of the issues. If he were he would recognize that the middle class is already wildly overtaxed for their health care – it’s just that he approves of insurance companies with massive profits and thinks that converting those over-payments into a cost-effective government system is a bad idea. Mostly because it means there are no insurance company blood-suckers getting fat off denial of care.
Which brings us to his nonsensical “nightmare scenario” which looks exactly like what we already have – unaccountable drones with no medical experience denying care to sick people – even when the result is death. Again, he just approves of who is making money off of letting people die.
Discussion with such idiots is impossible.
May 17th, 2009 at 12:39 am
I wasn’t trolling up above. If we expect this healthcare program to save taxpayers money over time, then we ought to spell out how in concrete figures starting with the CBO’s numbers. It’s really the best way to sell the program. $1 trillion being less than $1.5 trillion is less of a persuasive argument.
May 17th, 2009 at 12:56 am
A ‘mandateful plan’ could achieve full coverage if it provided affordable coverage. This one is going to turn out to be unaffordable for a lot of folks, because it’s gambling on largely unproven means to contain costs.
Canadian-style Medicare for all is ‘mandateful’ in that everyone is required to pay enough taxes to support it, but it would control costs, provide coverage for everyone, be affordable because if your income is low [or zero], your taxes are low [or zero].
May 17th, 2009 at 2:12 am
Nope, you’re stuck with plain-old moralistic arguments to people who disagree with you.
Well, if you don’t mind being called on your immorality, that’s fine by us. In the meantime, keep trying to suck your own cock.
May 17th, 2009 at 2:19 am
I finally figured it out. Wanheema Lubiano?
May 17th, 2009 at 2:22 am
Does anyone have numbers for the historical relationship of the forecast cost of new government programs vs. the actual cost (a decade or so later)?
Even simple things, like buildings, often come in at 3x forecasts. I’ve read (but have no cites) that forecast costs for Medicare and other social service legislation have often been too low by 10x.
May 17th, 2009 at 8:11 am
I know you’re not trolling, southpaw. You’re making a good case that our PR should be based on figures that show the total expenditure on healthcare (public and private) — not just on the federal portion of the tab. The federal portion is likely to increase, but that doesn’t mean overall costs will actually increase. (Since, e.g., we’re all picking up the tab for the uninsured in the form of higher hospital bills.)
I doubt the CBO will produce that kind of systemic accounting. It would be nice to see it produced by some relatively objective outside group.
May 17th, 2009 at 10:40 am
Texas has a law requiring drivers to car liability coverage on their vehicle. 20% of people in my town have no coverage. They get a very expensive ticket if caught, but statistics show many take the risk.
While I don’t expect the same rate with mandated health insurance due to government subsidies, it show a legal mandate along won’t solve the problem.
President Obama never talked about covering people in the U.S. illegally. Two studies, one by Rand and another by CIS, grossly overestimated the impact of illegals on America’s uninsured. Both the problem remains unaddressed by the Obama plan. That would account for some of the 25 to 33%.
I found this while looking for the % illegal statistic:
A recent study estimated that a one percent increase in the unemployment rate in 2008 would result in 1.1 million
more people without health insurance.
It’s from Kaiser Family Foundation.
http://www.kff.org/uninsured/7451.cfm
May 17th, 2009 at 1:51 pm
Billare – putting words in my mouth is not conductive to a good discussion of the issue. You’ll note that I did not endorse the Massachusetts plan at any point, let alone using “plain-old moralistic arguments.” The only mention of the Massachusetts plan I made was to question the CBO’s assessment about the residual uninsured. Next time address me, not a strawman.
JT – unless you haven’t been paying attention, “institutionalizing and expanding health care rationing and outright denial of care” is happening already, and it’s the insurance industry who’s doing it.