CBO: Senate legislation costs “more than $1 trillion,” would add $645 billion to deficit
A day after President Barack Obama delivered his address to Congress promising a deficit neutral bill, the Congressional Budget Office is out with a preliminary score on health care legisation being considered by the Senate Committee on Health, Education, Labor, and Pensions (HELP) that doesn’t help Democrats:
Our preliminary assessment was that the provisions of the legislation pertaining to insurance coverage would increase federal deficits by $645 billion over the 2010–2019 period—so such a Medicaid expansion would probably bring the total federal cost to more than $1 trillion. Adding a Medicaid expansion to the legislation would also yield a substantially larger reduction in the number of people who are uninsured, because about half of the people projected to be uninsured under current law would have income below 150 percent of the FPL.
The CBO also points out that the fines employers would have to pay if they don’t offer health coverage “would generally pass that cost on to their workers, primarily in the form of lower wages—just as firms that contribute toward health insurance today pay lower wages than they otherwise would, keeping their total compensation costs about the same.”
While the amount spent by Americans as a percentage of GDP is often cited by proponents of ObamaCare, the CBO notes that a “public option” would “could cause national spending on health care to increase by between 2 percent and 5 percent.”