While there’s a lot in the Baucus bill to pick apart, for now here’s the Republican Policy Committee’s take on what’s notable about the CBO score:
Re: Preliminary Analysis of CBO Score
· The total cost of the revised bill is $829 billion over 10 years (compared to $738 billion for the original mark).
o The bill spends nearly $100 billion more without noticeable improvement in coverage.
· CBO says the net reduction in the federal deficit would be $81 billion over 10 years. The earlier version saved $49 billion over 10 years.
o Note that JCT reported yesterday that the bill would generate $29 billion in additional revenue because drug companies, health insurers and the makers of medical devices companies would not be able to deduct new fees from their corporate taxes.
· 25 million people would remain uninsured in 2019, which is unchanged from the earlier score. 29 million additional people would receive coverage under the bill, which means that 94 percent of the population (excluding unauthorized immigrants) would have coverage.
· The number of people enrolled in Medicaid increased by 3 million compared to the original bill, and 1 million fewer people would have employer-based coverage under the revised bill. All told, 3 million people would lose employer-based coverage under the bill.
o It is likely much of the increase in government coverage is a result of a Rockefeller amendment that took children in SCHIP out of private coverage and put them into Medicaid.
· Taxes on high cost plans total $201 billion; taxes on uninsured individuals raise $4 billion; and taxes on employers from the free rider penalty raise $23 billion.
o Note that the individual mandate penalty fell from $20 billion to $4 billion with no noticeable drop in coverage.
· The bill includes $461 billion in federal subsidies to help purchase coverage through the new exchange, and $345 billion in additional federal outlays for Medicaid and CHIP.
· Total Medicare and Medicaid cuts total $404 billion. This includes $133 billion in Medicare Advantage cuts.
· CBO also said that the bill would save money outside the 10-year window; “CBO expects that the proposal, if enacted, would reduce federal budget deficits over the ensuing decade relative to those projected under current law—with a total effect during that decade that is in a broad range between one-quarter percent and one-half percent of GDP.”
o Notably, CBO assumes that revenues from the tax on high-cost plans will increase by 10-15 percent in the decade after 2019. Additionally, other taxes are projected to grow at 10 percent per year toward the end of the budget window. This a significant rate of increase.
Summary of Significant Changes in Amended Chairman’s Mark
Additional covered through Medicaid/CHIP
Covered through exchanges
Cost of coverage specifications
Revenue raised through excise tax on high-value plans
Revenue raised from excise tax on individual mandate
Revenue raised through penalty payments on employers
Net cost of Coverage specifications
Medicare and Medicaid cuts
Cuts to Medicare Advantage
Cuts to Hospitals inpatient PPS
Sense of the Senate Regarding MedMal
Other provisions raising revenue
Net ten year impact on deficit
$49 billion improvement
$81 billion improvement
$81 billion improvement