Score One for Senate Finance

This afternoon, the Congressional Budget Office (CBO) released its estimate of the budgetary and coverage effects of the Senate Finance Committee health reform legislation. The bottom line is that this mark demonstrates that we can expand coverage and improve quality while being fiscally responsible. It does not add one dime to the deficit over the next 10 years and, according to CBO, reduces deficits significantly thereafter.

 

Specifically, over the next 10 years, CBO reports that the Senate Finance bill would reduce deficits by $81 billion — and, after that, the fiscal news gets even better. CBO projects that the bill would reduce deficits in the second decade by one-quarter to one-half of a percent of GDP. To put that in context: this is equivalent to deficit reduction of between $450 and $900 billion over the coming decade. 

 

These figures, furthermore, largely exclude the impact of "game-changing" measures that can move health care toward a higher-quality, lower-cost future and bend the cost curve in the long-run. As experts ranging from the Institute of Medicine to the Brookings Institution to CBO itself have recognized, these game-changing measures — such as an expansion of bundled payments for medical providers, support for accountable care organizations, and creation of a Medicare Commission — hold substantial promise for transforming our health care system into one that delivers higher-quality care, not just more care.

 

Putting the green eyeshades aside, this bill also will help millions more Americans gain health insurance coverage. In fact, the share of legal residents who are uninsured would be reduced by almost two-thirds— 29 million Americans would gain coverage by the end of the decade. And for those with health insurance, it would provide stability and security and protect them from some of the insurance industry’s worst practices — like denying coverage because of a pre-existing condition, or dropping or watering down coverage when you get sick and need it most.
 

There remains work to be done. Congress still has to merge various versions of reform legislation into one final bill. But there is much overlap among those bills — and a growing consensus in this country that we can no longer wait for reform (Bob Dole, for one, just endorsed it). We are already far closer to health insurance reform than ever before, and today’s CBO analysis is yet another important step along the way.