Here’s the CBO Score for H/C Insura Bailout

Here is the Congressional Budget Office’s Score for the Health Care Insurance Bailout, which was just released now, Thursday morning, March 18, 2010.  (thank you, HuffPo)   It is a pdf.  Since it’s a government document, I’m going to post it here, sans the charts, and let you all have a look see instead of pointing you to a pundit.

http://big.assets.huffingtonpo…

and so it begins,

Honorable Nancy Pelosi Speaker U.S. House of Representatives Washington, DC 20515

Dear Madam Speaker:

March 18, 2010

The Congressional Budget Office (CBO) and the staff of the Joint Committee on Taxation (JCT) have completed a preliminary estimate of the direct spending and revenue effects of an amendment in the nature of a substitute to H.R. 4872, the Reconciliation Act of 2010; that amendment (hereafter called “the reconciliation proposal”) was made public on March 18, 2010. The estimate is presented in three ways:

full text continues

CONGRESSIONAL BUDGET OFFICE

Douglas W. Elmendorf, Director

U.S. Congress Washington, DC 20515

Honorable Nancy Pelosi, Speaker, U.S. House of Representatives Washington, DC 20515

Dear Madam Speaker:

March 18, 2010

The Congressional Budget Office (CBO) and the staff of the Joint Committee on Taxation (JCT) have completed a preliminary estimate of the direct spending and revenue effects of an amendment in the nature of a substitute to H.R. 4872, the Reconciliation Act of 2010; that amendment (hereafter called “the reconciliation proposal”) was made public on March 18, 2010. The estimate is presented in three ways:

• An estimate of the budgetary effects of the reconciliation proposal, in combination with the effects of H.R. 3590, the Patient Protection and Affordable Care Act (PPACA), as passed by the Senate;1

• An estimate of the incremental effects of the reconciliation proposal, over and above the effects of enacting H.R. 3590 by itself;

• An estimate of the budgetary impact of the reconciliation proposal under the assumption that H.R. 3590 is not enacted (that is, an estimate of the bill’s impact relative to current law as of today).

Although CBO completed a preliminary review of legislative language prior to its release, the agency has not thoroughly examined the reconciliation proposal to verify its consistency with the previous draft. This estimate is therefore preliminary, pending a review of the language of the reconciliation proposal, as well as further review and refinement of the budgetary projections.

The reconciliation proposal includes provisions related to health care and revenues, many of which would amend H.R. 3590. It also includes amendments to the Higher Education Act of 1965, which authorizes most federal programs involving postsecondary education.

H.R. 3590 is the House’s version of the Health Care Bill.  The Senate is using the same number for their version.

The HigherEducationAct of 1965 amendments concern the student loan program for college educations, which was added to this because sausage can never have too many ingredients.

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1An estimate by CBO and JCT of the direct spending and revenue effects of H.R. 3590 as passed by the Senate was provided in a letter to the Honorable Harry Reid on March 11, 2010. That estimate is available at www.cbo.gov (and JCT’s detailed table of revenue effects is available at www.jct.gov).

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Harry Reid has a letter saying what would happen if the Senate passed its own version, and did nothing else, and he’s had it since March 11, 2010. It’s online.

Here’s the important part, pg 2

Honorable Nancy Pelosi Page 2

CBO and JCT estimate that enacting both pieces of legislation-H.R. 3590 and the reconciliation proposal- would produce a net reduction in federal deficits of $138 billion over the 2010-2019 period as result of changes in direct spending and revenue (see the top panel of Table 1 and subtitle A of title II on Table 5). Approximately $85 billion of that reduction would be on-budget; other effects related to Social Security revenues and spending as well as spending by the U.S. Postal Service are classified as off-budget. CBO has not completed an estimate of the potential impact of the legislation on discretionary spending, which would be subject to future appropriation action.

CBO and JCT previously estimated that enacting H.R. 3590 by itself would yield a net reduction in federal deficits of $118 billion over the 2010-2019 period, of which about $65 billion would be on-budget. The incremental effect of enacting the reconciliation proposal-assuming that H.R. 3590 had already been enacted-would be the difference between the estimate of the combined effect and the previous estimate for the Senate- passed bill, H.R. 3590. That incremental effect is an estimated net reduction in federal deficits of $20 billion over the 2010-2019 period over and above the savings from enacting H.R. 3590 by itself; almost all of that reduction would be on-budget (see the bottom panel of Table 1 and subtitle A of title II on Table 5).2

The budgetary impact of the reconciliation proposal if H.R. 3590 is not also enacted would be different. Although estimates on that basis have been completed for most of the provisions of the reconciliation proposal, CBO does not yet have such an estimate for all of its provisions. By CBO’s estimate, the provisions that have been analyzed so far would reduce deficits by $82 billion over the 2010-2019 period (see Table 6).

Details on the budgetary effects of the health and revenue provisions of the reconciliation proposal, along with its effects combined with H.R. 3590, are provided in Tables 1, 2, and 3:

• Table 1 summarizes the effect on the deficit of the health and revenue provisions of the reconciliation proposal combined with H.R. 3590; it also shows the net incremental effect of those provisions of the reconciliation proposal over and above the impact of enacting H.R. 3590 by itself.

• For the two pieces of legislation combined, Table 2 provides estimates of the changes in the number of nonelderly people in the United States who would have health insurance and presents the primary budgetary effects of the provisions related to health insurance coverage.

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2 The reconciliation proposal would require the Secretary of the Treasury to transfer amounts from the on-budget general fund to the off-budget Social Security trust funds to offset any reduction in the balances of those trust funds that would result from other provisions of the proposal. As a result, the off-budget changes estimated for that proposal represent only its effect on outlays of the Postal Service.

Reconciliation:

should save $138 billion

about 85 billion is on budget, other parts indirectly, or off budget

previous estimate, pre- reconciliation proposal,  of saving $118 billion

about $65 billion was on budget,  the rest indirectly, or off budget

But it is a preliminary estimate.

Honorable Nancy Pelosi Page 3

• For the two pieces of legislation combined, Table 3 displays detailed estimates of the costs or savings from the health provisions that are not related to health insurance coverage (primarily involving the Medicare program) and from certain of the revenue provisions that are not related to insurance coverage. The table does not include the effect on revenues of title IX, a set of tax provisions whose impact is reported separately by JCT.

Tables 4 and 5 show the incremental budgetary effects of the reconciliation proposal (except for title IX), over and above the effects of enacting H.R. 3590 by itself:

• Table 4 presents the incremental effects of the health and revenue provisions of the reconciliation proposal—that is, the difference between the effects of the two pieces of legislation combined and the effects of H.R. 3590 by itself (as shown in CBO’s March 11 letter to Senator Reid).

• Table 5 summarizes the incremental effects of the health, revenue, and education provisions of the reconciliation proposal, also assuming that H.R. 3590 has been enacted. (The impact of the health and revenue provisions is shown in more detail in Table 4.)

Table 6 shows the estimated effect of enacting the reconciliation proposal relative to current law—that is, assuming that H.R. 3590 is not enacted. That table does not include some effects that have not yet been estimated.

Effects of the Legislation Beyond the First 10 Years

Although CBO does not generally provide cost estimates beyond the 10-year budget projection period, certain Congressional rules require some information about the budgetary impact of legislation in subsequent decades, and many Members have requested CBO’s analyses of the long-term budgetary impact of broad changes in the nation’s health care and health insurance systems.

Therefore, CBO has developed a rough outlook for the decade following the 2010-2019 period by grouping the elements of the legislation into broad categories and (together with the staff of the Joint Committee on Taxation) assessing the rate at which the budgetary impact of each of those broad categories is likely to increase over time.

Our analysis indicates that H.R. 3590, as passed by the Senate, 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 gross domestic product (GDP).3 The imprecision of that calculation reflects the even greater degree of uncertainty that attends to it, compared with CBO’s 10-year budget estimates.

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3 For a more extensive explanation of that analysis, see Congressional Budget Office, letter to the Honorable Harry Reid regarding the longer-term effects of the manager’s amendment to the Patient Protection and Affordable Care Act (December 20, 2009).

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in other words, we’re only human here at the CBO, and we’re not going to blow smoke up your bums past the 10 year initial estimate of financial impact, other than to say,  Tally Ho !  Lookin’ Good !

Honorable Nancy Pelosi Page 4

Using that same analytic approach, the combined effect of enacting H.R. 3590 and the reconciliation bill would also be to 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 around one-half percent of GDP. The incremental effect of enacting the reconciliation bill (over and above the effect of enacting H.R. 3590 by itself) would thus be to further reduce federal budget deficits in that decade, with a total effect that is in a broad range between zero and one-quarter percent of GDP.

Relative to H.R. 3590, the reconciliation proposal would make a number of changes that would affect its longer-term impact on the budget. In particular, it would increase the subsidies offered in the new insurance exchanges and would reduce the impact of an excise tax on health insurance plans with premiums above certain thresholds. An important component of the longer-term analysis is that, beginning in 2019, the reconciliation proposal would change the annual indexing provisions so that the premium subsidies offered through the exchanges would grow more slowly; over time, the spending on exchange subsidies would therefore fall back toward the level under H.R. 3590 by itself. Another key component of the longer-term analysis is that, beginning in 2020, the reconciliation proposal would index the thresholds for the high-premium excise tax to the rate of general inflation rather than to inflation plus one percentage point.

CBO has not extrapolated estimates further into the future because the uncertainties surrounding them are magnified even more. However, in view of the projected net savings during the decade following the 10-year budget window, CBO anticipates that the reconciliation proposal would probably continue to reduce budget deficits relative to those under current law in subsequent decades, assuming that all of its provisions would continue to be fully implemented.

Congressional rules governing the consideration of reconciliation bills also require an assessment of their budgetary impact separately by title. The effects of the reconciliation proposal over the 2010-2019 period are shown in Table 5, assuming that H.R. 3590 is also enacted). CBO’s analysis of the longer-term effects, by title, is as follows:

• Most of the changes to H.R. 3590 that have significant budgetary effects would be made by title I of the reconciliation proposal, so the conclusions about the longer- term impact for the proposal as a whole-that it would reduce deficits, relative to H.R. 3590-also apply to that title.

• The changes regarding health care contained in title II have a smaller budgetary impact than those in title I, and would by themselves increase budget deficits somewhat. That title also contains the proposal’s education provisions, which CBO estimates would reduce future deficits. In CBO’s estimation, the savings generated by the education provisions would continue to outweigh the costs ….  (this sentence continued on page 5)

ah, the ol’ Deficit Reduction bugaroo~  or, I thought this was going to reduce it, what happened~

Remember the Gross Domestic Product (GDP) is NOT the same thing as the US Federal Budget ! See wiki-   It is a measure of everything the country produces inside its borders, consumer, investment, govt spending, exports minus imports.

So when they say it could reduce the deficit by zero 0  to a quarter percent .0025 of the Gross Domestic Product, they mean it could be saving a quarter of one percent of 15 trillion dollars or more.  

This country currently spends about 16% of our Gross Domestic Product on health care costs now,  http://en.wikipedia.org/wiki/H…

so this CBO report says they think  it might save money and reduce the deficit slightly, but mainly it slows down medical costs skyrocketing past other inflation on a yearly basis.

Expect LOTS of Republican blowback messaging stupidity on this part.  Remember, even if you don’t like the bill, the Republicans deliberately lie about what does what, and if you want better legislation now or in the future, you have to get your ideas out there FIRST instead of just reacting to what the Republicans are making up, because they dominate the MSM narrative.

This country has almost always been in debt. I’m not defending it, it is just the way it is. We owe.  If I say the percentage of Gross Debt as a percentage of the Gross Domestic Product is 86.1 % this year, that sounds horrible. And it’s not good, but:

The percentage of Gross Debt as a percentage of the Gross Domestic Product (GDP) was  •••• 57% or $5.7 Trillion under George W Bush in 2001, and went up to 70.2% or $9.9 Trillion under Bush by 2008.   Yet under Clinton, who preceded GW Bush, the Gross Debt as a % of GrDomProd dropped about 2%  by the year 2000,  to 58%, but was still in the mid $5.6 Trillion range.   http://en.wikipedia.org/wiki/U…  

But in the year 1950, the Gross Debt was 94% of the Gross Domestic Product ! Post World War II, why didn’t we just roll over and give up ?

The massive drug and insurance companies would prefer we take a submissive posture and react to the PR firms the Republicans use to spin crap.

translation last sentence of this page of the CBO report page 4

We think letting students stay on their parent’s insurance, and not loan sharking college students,  might have a positive overall impact on the economy, but for the Love of FSM don’t tell anyone we admitted that here at CBO

Honorable Nancy Pelosi Page 5

…..   related to health care stemming from title II, so that the title as a whole would continue to reduce the budget deficit in future years.

CBO has not yet completed an assessment of the impact for the longer term of enacting the reconciliation proposal by itself.

I hope this analysis is helpful for the Congress’s deliberations. If you have any questions, please contact me or CBO staff. The primary staff contacts for this analysis are Philip Ellis and Holly Harvey.

Enclosures

cc: Honorable John A. Boehner Republican Leader

Honorable John M. Spratt Jr. Chairman Committee on the Budget

Honorable Paul Ryan Ranking Member

Honorable Harry Reid Senate Majority Leader

Honorable Mitch McConnell Senate Republican Leader

Honorable Kent Conrad Chairman Senate Committee on the Budget

Honorable Judd Gregg Ranking Member

There’s also a chart below this if you download the pdf.

See, now you can say you read it.  That wasn’t so bad, was it.

And you can say Kent Conrad is full of styrofoam when he thinks he’s going to fool people that we get rid of the Gross Domestic Debt with this.

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update  Well, what do you know ?  Seems that Kent Conrad, D, Chair of the Senate Budget Commitee, had a little North Dakota Kickback in that Reconciliation bill for doing those student loans with the Bank of ND, which is a state owned bank.  per FDL

http://fdlaction.firedoglake.c…

It never fails.  A twitter post is claiming that Conrad’s staff called to take it out.