Audio: Health On The Hill – Post-CBO Estimate on Reconciliation Package

Jackie Judd, Kaiser Family Foundation; Mary Agnes Carey, Kaiser Health News

With a new preliminary Congressional Budget Office released Thursday morning and language of the health care reconciliation package posted in the afternoon, House Democratic leaders continue their push to pass their health care overhaul legislation this weekend. CBO said the Democrats’ plan would reduce the deficit by $138 billion over the next decade and provide health coverage to about 31 million Americans.


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Full Transcript:

Jackie Judd: Good day, I’m Jackie Judd with a special update of Health on the Hill. The Congressional Budget Office has weighed in on the cost of the health overhaul bill that the House is poised to vote on in coming days. Here to bring us up to date is Mary Agnes Carey of Kaiser Health News, reporting to us from the Capitol. Mary Agnes, what are the numbers?

Mary Agnes Carey: The Congressional Budget Office says the new package would cost about $940 billion over the next decade. The preliminary estimate also says that it would reduce the deficit by $138 billion over the next decade, and $1.2 trillion over the next 10 years, and also that 32 million Americans would have coverage. So these are numbers that Speaker Nancy Pelosi and her Democratic team are very happy to point to because deficit reduction for them has been a big part of the health care debate.

JJ: And the deficit reduction number is slightly higher than it was for the House and Senate bills voted on late last year, but the spending number is a little higher too, right?

MAC: It is a little higher. The Senate number was about $870 billion range, but lets remember, as part of the reconciliation package they had to add some sweeteners: more subsidies to help people purchase health insurance coverage, to close this “doughnut hole” gap in the Medicare drug bill where folks are on their own for awhile until catastrophic coverage kicks in. And they wanted to add more money to help states pay for Medicaid expansion. Those things all cost money, and have raised the cost of the bill.

JJ: You bring up the point that through this CBO analysis we finally can take a look at what the Democrats want to bring to the floor. Until today, we didn’t know that, right?

MAC: Right. There had been a lot of proposals out there. Of course, the President put a proposal out about a month ago to make changes to bridge the gap, they’d been looking at them, talking to members, trying to figure out what will help in the House, what can pass all the reconciliation procedures in the Senate. Its been a very difficult and long path, and of course we haven’t seen the language yet, but this is what the package is trying to do. We’ve hit all those points, with something that can pass the House and pass the Senate, and amend things in the Senate bill that the House Democrats don’t like.

JJ: Now, one element that apparently has been dropped is the proposal that the President put out there a couple weeks ago to give the federal government essentially the power to review insurance premium rates.

MAC: Right. The problem with that is, under reconciliation, things have to affect revenue. It has to raise taxes, reduce revenues. The thought is that this idea of giving the federal government more power over insurance companies doesn’t fall within those parameters. Again, we haven’t seen the final language, but that regulatory board for insurers is not expected to be in that reconciliation package.

JJ: Okay, and just quickly, Mary Agnes, where does the deficit reduction piece of this come in?

MAC: It allows the Speaker, other Democrats, and the President to say that health reform will not bust the federal budget. It goes to fight those Republican accusations that this is a government takeover of health care and that it will drive up costs of health care, and it drives up what taxpayers are paying. This gives them ability to say no, the Congressional Budget Office – and again, this is a preliminary score from CBO – but that the Congressional Budget Office says this will reduce the deficit, not add to it. It’s a very powerful weapon in their arsenal as they try to pass the bill.

JJ: And they’re getting to deficit reduction by new fees and taxes?

MAC: Right. They’ve done some things like, for example, going back to the drug makers and asked for $10 billion more from the drug industry. They’re going to take more money away from the Medicare Advantage plans – these private insurance plans in Medicare – they’re going to ask them to pay more. They’re going to apply Medicare payroll taxes to unearned income. Things like dividends, capital gains – they haven’t had to pay payroll taxes on those – they’re going to have to do that. They’ll take steps like this to increase revenue in the package.

JJ: Lets move on now to a discussion of what’s next. The Democrats say they will post a bill, and then there will be a 72-hour window during which anyone who likes to can read it, and then there will be votes. When will that happen?

MAC: Speaker Pelosi just said in a news conference that later this afternoon the reconciliation package will be posted on the internet. That kicks off the 72-hour review period that she and other Democratic leaders have said the language will be available before the House takes a vote. So during that period of time they want lawmakers to look at it, and see the changes they’ve made, and think about it – especially the folks that voted against it before, if they’ll vote for it. The second thing that will happen is the House Rules Committee, which is a committee here that sets the parameters for floor debate, they will have a meeting, which I predict will be an extremely long meeting, where members will come and give testimony. Republicans will probably try to amend the package, I don’t think any amendments will be allowed to this, but they’ll set up the parameters for the floor debate, and we’re looking at a House vote possibly on Sunday. But a lot of this depends on where the votes are. I don’t think they’d move ahead on a floor debate unless they had the votes locked down. Speaker Pelosi at this news conference, along with other Democratic leaders, seemed very confident about where they are and where things are going. So we’ll see how it plays out in the next few days, but now it’s all about finding out, do you have that magic number of 216 votes to pass this bill?

JJ: And also this afternoon, the President – or the White House I should say – announced that the President’s trip to Asia has been pushed back until the summer, until June, instead of just pushing it back by a few days. What does that say about the expectation of when Congress will act one way or the other?

MAC: I think it means that time is of the essence. They want this bill voted on this weekend, and the President is going to stay in town to meet with members individually, to call them, to apply any pressure that he can to get this vote to turn out the way he wants, which is to have this bill pass.

JJ: Okay. Mary Agnes Carey of Kaiser Health News on Capitol Hill, thank you so much. I’m Jackie Judd, and this has been Health on the Hill.