New healthcare bill won't hurt deficit. What about your wallet?
The CBO says the Senate Finance bill will create a $81 billion surplus over 10 years. But critics say its fees, taxes, and mandates will hit Americans’ pocketbooks hard.
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“When people have been laid off or are worried about getting laid off, the idea of new taxes on employers and individuals should concern all of us. I'd like to see Congress insure more Americans with less stress on the weakest economy, including family finances, in decades,” he added in a statement.
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The newly minted CBO score puts the Finance bill’s cost over the next decade at $829 billion. With cuts to Medicare and other federal programs, along with new fees and taxes, that nets an $81 billion reduction in the federal deficit.
By 2019, 94 percent of legal US residents will have insurance coverage, reducing the ranks of the uninsured by 29 million. That leaves 25 million still uninsured, including more than 8 million unauthorized immigrants, according to the CBO’s preliminary analysis.
That compares with a version by the Senate Health, Education, Labor, and Pensions Committee that scored $597 billion in the red. The last CBO score on a House plan projected that it would add $239 billion to the federal deficits from 2010-2019. All included some version of a public option.
“Those estimates are all subject to substantial uncertainty,” said CBO director Douglas Elmendorf, in an Oct. 7 letter to Sen. Max Baucus (D) of Montana, who chairs the Senate Finance panel.
Healthcare's hidden costs
But the bigger uncertainty, both fiscally and politically, is how these new mandates, fees, and charges will affect budgets outside the Beltway. It’s a tough debate for reform advocates to win, because many of the costs in the current healthcare system are hidden, including the cost of doing nothing.
“Workers don’t understand that employer-provided health plans are coming out of their wages. Employers get to deduct it and employees don’t have to pay taxes for it. But the tax subsidy means that somebody is paying for it and everybody’s income taxes are higher,” says James Horney, director of federal fiscal policy at the Center on Budget and Policy Priorities.
“That’s why fixing healthcare is so hard, because people don’t really understand what they’re paying now and what’s going to drive it up in the future,” he adds.
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