Senate Healthcare Bill Finally Gets CBO Score: $849 Billion

November 19, 2009 9:39 a.m. EST

Washington, D.C. (AHN) - With a score from the Congressional Budget Office, Senate Democrats late Wednesday unveiled a healthcare bill that they hope to introduce on the floor for debate this week. Republicans oppose the new taxes in the measure and they are expected to block it.

The Patient Protection and Affordable Care Act costs $849 billion over 10 years, and will reduce the deficit by $130 billion over the next decade. It will provide insurance to 94 percent of the nation, extending coverage to 31 million more Americans.

According to the CBO, costs are offset partly by $149 billion in revenues from an excise tax on high-premium insurance plans, the controversial provision dubbed the "Cadillac" tax, and $100 billion in net savings from other sources.

The legislation is the merging of the $829 billion health proposal approved by the Finance Committee that has non-profit insurance cooperatives instead of a public option, and the $600 billion measure from the Health Committee that has a strong government insurance option.

A public option is a government-run, voluntary program that would compete with private insurance by offering cheaper coverage. Democrats support it because they believe it would help make the costs of overhauling the nation's healthcare system and expanding coverage to the 47 million uninsured, more affordable. Republicans say it would raise unemployment, harm small businesses, would not reduce costs nor provide insurers with fair competition.

Unlike the final bill in the House, the Senate bill has public option that will allow states to opt out of a federal program.

And while the House bill has a tax on the top 0.3 percent taxpayers or couples earning more than $1 million, Reid's measure has a 40 percent tax on insurers for "Cadillac" insurance plans, or those costing more than $8,500 for individuals and $23,000 for families. The tax previously had a lower cap -- $8,000 and $21,000 -- and the change was made amid strong opposition from Democrats and unions who said the cost would be passed on to consumers.

Moreover, in contrast to the $894 billion House proposal, the Senate bill creates an independent commission that will provide Congress with recommendations on how to reduce growing costs of Medicare, which will be insolvent by 2017.

"The Democrats start with a 2,000-page bill, with a government takeover, with more than $1 trillion in spending, with new taxes, higher premiums and Medicare cuts," Sen. Lamar Alexander (R-TN), the chairman of the Senate GOP Conference said in a floor speech on Wednesday.

"We don't believe they can spend that much more money without increasing the debt-in other words, this is all going in the wrong direction," he added. "Republicans believe we ought to be reducing costs step by step, and step number one should be small business health plans."

But Senate Majority Leader Harry Reid (D-NV) said in a press conference the same day, "As we expected, these defenders of the status quo to misrepresent reform efforts. Special interest groups who benefit from the status quo are determined to keep things the way they are."

"Senate Republicans are lining up against the health care needs of the American people to protect insurance companies," Reid added. "They're opposed to even having a debate in the Senate, robbing the American people of a historic opportunity... If we keep down the road we're on now, American healthcare costs will continue to grow.... insurance companies will continue to deny coverage for pre-existing disabilities, for whatever your gender might be, or because you're getting older."

President Barack Obama issued a statement while in Asia hailing the release of the legislation as a milestone.

"From day one, our goal has been to enact legislation that offers stability and security to those who have insurance and affordable coverage to those who don't, and that lowers costs for families, businesses and governments across the country," he said. "Majority Leader Reid, Chairmen Baucus and Dodd, and countless Senators have worked tirelessly to craft legislation that meets those principles."

The Senate is expected to hold a vote late this week on whether to proceed to debate on the legislation.

Reid will need 60 votes to begin debate on the measure, a challenging task since Democrats have a 60-vote majority that includes centrist Democrats known to buck party line such as Sen. Ben Nelson (D-NE), and two independents who caucus with them, Sen. Joe Lieberman (I-CT) and Sen. Bernard Sanders (I-VT).

Nelson said on Wednesday that he "will need adequate time-over several days" to review the final bill as well as the CBO score. He also warned that his vote on a motion to proceed should not be considered support for the proposal.

"Some who define it as a vote in favor of the Reid bill are misinformed, or are intentionally trying to mislead people," he said. "Some who define it as supporting or opposing President Obama and his agenda do so because they either want him to succeed or fail. That's more of the old Washington political gamesmanship people are fed up with."

He added, "If you don't like the bill, then why would you block your own opportunity to amend it?"

Lieberman, on the other hand, has repeatedly warned he would vote against any bill that includes a public option.

"Making taxpayers assume the financial burden for an expansive new government entitlement program will make it harder for us to save Medicare," he said in an op-ed early this month." A new public option will likely increase premiums for the 170 million Americans who already have private insurance."

Reid earlier this month admitted for the first time that Democratic efforts to overhaul healthcare may continue to next year. Congress holds a week-long recess for Thanksgiving.

"We're not going to be bound by any timelines," he said in a press conference. "We're going to do this legislation as expeditiously as we can and as fairly as we can."