CBO: Public Health Care Option Cheaper & Better Than Expected


Previously, the Congressional Budget Office released an analysis supposedly examining the Democratic health care reform proposal.  Their conclusions found the proposal would cost nearly $1 trillion and still leave millions of Americans uncovered.

But, as it turns out, the CBO’s analysis was flawed–it was based not on what the Democrats were proposing but on old, outdated information.  Conservatives, of course, jumped all over the CBO’s flawed analysis as proof that health care reform with a public option was untenable.

Well, the CBO just released an updated analysis–based on the plan Democrats are actually proposing–and guess what they found:

The plan carries a 10-year price tag of slightly over $600 billion, and would lead toward an estimated 97 percent of all Americans having coverage, according to the Congressional Budget Office, Sens. Edward M. Kennedy and Chris Dodd said in a letter to other members of the Senate Health, Education, Labor and Pensions Committee. The AP obtained a copy.


The letter indicated the cost and coverage improvements resulted from two changes. The first calls for a government-run health insurance option to compete with private coverage plans, an option that has drawn intense opposition from Republicans.


Additionally, the revised proposal calls for a $750 annual fee on employers for each full-time worker not offered coverage through their job. The fee would be set at $375 for part-time workers. Companies with fewer than 25 employees would be exempt. The fee was forecast to generate $52 billion over 10 years, money the government would use to help provide subsidies to those who cannot afford insurance.

The same provision is also estimated to greatly reduce the number of workers whose employers would drop coverage, thus addressing a major concern noted by CBO when it reviewed the earlier proposals.


In their letter, Kennedy and Dodd said the Congressional Budget Office “has carefully reviewed our complete bill, and we are pleased to report that CBO has scored it at $611.4 billion over 10 years, with the new coverage provisions scored at $597 billion. …The completed bill virtually eliminates the dropping of currently covered employees from employer-sponsored health plans.

[Emphasis mine]

The crux of Republican opposition to health care reform are that it would cost huge amounts of money and it would (allegedly) drive private insurance out of business by causing a large amount of employers to dump their employees onto the public option.

But this new CBO analysis shows that both of those talking points are untrue.  The GOP now has no solid ground upon which to oppose health care reform beyond simple, craven, conservative obstruction.

In fact, the cost of health care reform is so low that we can already pay for it out of the funds allotted in Obama’s budget:

President Barack Obama’s first budget will seek $634 billion over 10 years as a down payment on health care reform, a senior administration official said Wednesday.

Down payment? The Democratic health care reform proposal is so good that the down payment is going to be the only payment.

Of course, Republicans will still obstruct the plan.  But with 60 Democrats in the Senate, the GOP will no longer be able to stand in the way of sensible, necessary health care reform.