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CBO Sets $940 Billion Price Tag on Final Health Care Bill

By Alex Wayne and Edward Epstein, CQ Staff

House Democratic leaders touted their final health care overhaul package Thursday, as the Congressional Budget Office posted its preliminary official cost estimate and President Obama again delayed a planned trip to Asia.

Speaker Nancy Pelosi, D-Calif., said, "This is historical. He wants to be here for the history."

The House is expected to vote Sunday afternoon on the final package, with floor action to follow in the Senate as early as next week. Obama put off his trip until June to help in the final push.

Pelosi predicted the CBO analysis will ease the doubts of some wavering House Democrats and said, "We feel very strong about where we are, how we proceed."

But she and her leadership team are still trying to nail down the 216 votes among Democrats they will need to pass the bill.

Top Democratic aides and Pelosi have been saying that until the CBO report came out and the final language of a bill amending the Senate-passed health legislation (HR 3590) was ready, leaders couldn't really whip members for their votes. But now, Pelosi said, she will go all-out. "We're going to share these numbers more fully with our members," she said.

She said that Republicans and private health insurance companies who oppose the Democrats' bill are going to do everything they can before the House vote to keep Democrats from reaching 216 votes.

Pelosi wouldn't confirm that she plans to use a so-called self-executing rule to clear the Senate-passed health care bill (HR 3590) and pass the accompanying reconciliation bill (HR 4872).

Republicans, who used the self-executing rule dozens of times when they were in control of the House, are sharply attacking Democrats for possibly using the parliamentary device for such major legislation. They want an up or down vote on the Senate bill.

Making the Numbers Work
House Majority Leader Steny H. Hoyer, D-Md., called the legislation the largest deficit-reduction legislation since 1993. CBO, in a preliminary score posted late Thursday morning, reported that the bill would cost $940 billion over 10 years, but thanks to reductions in Medicare spending and tax increases, it would reduce the deficit by a net of $138 billion during that period and by $1.2 trillion in its second decade.

To achieve that huge second-decade deficit figure, Democrats propose indexing to inflation only, rather than inflation plus one percentage point, the threshold at which high-cost "Cadillac" health insurance plans would trigger an excise tax. That means the tax's scope would grow even faster than in the Senate bill, because health insurance premiums tend to rise faster than inflation.

The bill would create state-based exchanges, or marketplaces, where individuals without employer-provided insurance could buy health coverage. Federal subsidies would be available to help cover the cost for many purchasers.

In the first five years of the exchanges, they would provide more generous subsidies for people buying policies than the Senate bill proposed. But in 2019, they propose to suddenly reduce the rate of growth of the subsidies to something closer to that of the Senate bill.

House Republicans said Democrats were "spinning for partisan gain" and accused them of "double counting" Medicare savings.

The final measure, according to a Democratic source, would pare the annual growth in Medicare expenditures by 1.4 percentage points per year, while closing the "doughnut hole" gap in prescription drug coverage and extending the program's solvency by at least nine years. It also would extend health insurance coverage to about 32 million people who currently lack it, leading to coverage of an estimated 95 percent of Americans.

Senate Fight
Hoyer said he is confident, but not certain, the bill would survive parliamentary challenges in the Senate, where Democrats intend to pass it under fast-track budget reconciliation procedures. That would permit passage of the bill by a simple majority rather than the 60 votes otherwise needed to surmount a filibuster.

"I won't say that I have 110 percent confidence with every judgment being made," Hoyer said. "I have 110 percent confidence that we have tried to make sure we are in compliance with the requirements [of reconciliation] and the anticipated rulings" by the Senate's parliamentarian.

Senate Republicans are expected to lodge points of order against provisions they suspect may not meet the strict budgetary rules of the reconciliation process. If their challenges are upheld by the chair (advised by the parliamentarian), it would require 60 votes to waive the point of order.

Hoyer said he has sought assurances from Senate Majority Leader Harry Reid, D-Nev., that the reconciliation measure can pass the Senate without changes.

"Sen. Reid has assured us there will be representations made, sufficient for House members to rely on as fact, that if they pass something it won't be changed or not passed in the Senate," Hoyer said.

He dismissed Republican criticism of the "deeming" procedure Democrats plan to use in the House. Instead of voting directly on the Senate bill, which many House Democrats call deficient, the rule governing debate on the reconciliation bill may "deem" the Senate bill cleared once the rule is adopted and the reconciliation bill is passed.

Hoyer likened it to adopting a conference report, the traditional method of completing legislation. "When you vote for the rule, you will vote for the Senate bill," he said. "But I will say, however, that the Senate bill will not pass unless it is amended, as a conference report would do. What we are doing is a process which in fact carries out exactly what you would do in a conference report."

The only difference, he said, is that the Senate bill will be amended after it is passed, instead of before.

House Rules Chairwoman Louise M. Slaughter, D-N.Y., said her panel could meet early Saturday, March 20.

Hoyer announced the House would convene at 1 p.m. Sunday, but the vote on health care would not begin until after 2 p.m. in keeping with the leadership's promise that members would have a full 72 hours to review the text of the final bill. That text was posted shortly after 2 p.m. Thursday on the Rules Committee's web site.

Obama had been scheduled to begin a trip to Asia on March 21, after delaying it once already to help Democrats round up votes.

Hoyer indicated that he would prefer that the president stay in Washington that day. "I think the president's presence helps," he said, in response to a question. "But need it? The president's been talking to folks, he's been working it. Wherever the president is, he can talk to them on the phone."

Obama took the hint. Later that day, White House Press Secretary Robert Gibbs said the president was putting off his trip until June to focus on the health care fight.

First posted March 18, 2010 10:34 a.m.

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