Late this afternoon the Congressional Budget Office released a partial estimate of the House’s version of the Obamacare plan. Keep in mind that this $1 Trillion plus cost:
do not represent a formal or complete cost estimate for the draft legislation. First, as noted above, these figures do not address the entire bill…our analysis does not incorporate the administrative costs to the federal government of implementing the specified policies nor all of the proposal’s likely effects on spending for other federal programs; we expect to include those effects in the near future
CBO and the staff of the Joint Committee on Taxation (JCT) worked together to produce a preliminary analysis of the major provisions related to health insurance coverage that are contained in draft legislation called the America’s Affordable Health Choices Act, which was released today by several House committees. Among other things, those provisions would establish a mandate for most legal residents to obtain insurance, significantly expand eligibility for Medicaid, and set up insurance “exchanges” through which certain individuals and families could receive federal subsidies to substantially reduce the cost of purchasing that coverage. The analysis issued today does not take into account other parts of the proposal that would raise taxes or reduce other spending (particularly in Medicare) in an effort to offset the federal costs of the coverage provisions.
The tables included in the report summarize our preliminary assessment of the coverage provisions’ budgetary effects and their likely impact on rates and sources of insurance coverage for the nonelderly population. According to that assessment, enacting those provisions by themselves would result in a net increase in federal budget deficits of $1,042 billion over the 2010–2019 period. By 2019, CBO and the JCT staff estimate, the number of nonelderly people who are uninsured would be reduced by about 37 million, leaving about 17 million nonelderly residents uninsured (nearly half of whom would be unauthorized immigrants).
The figures released today do not represent a formal or complete cost estimate for the draft legislation. First, as noted above, these figures do not address the entire bill. Second, the analysis was based on specifications that were provided by staff of the three committees and that differ in important ways from the “discussion draft” version of legislative language that was released in June. The specifications that we analyzed are supposed to be reflected in the draft language released by the committees today, but we have not yet been able to analyze that language to determine whether it conforms to those specifications. Third, our analysis does not incorporate the administrative costs to the federal government of implementing the specified policies nor all of the proposal’s likely effects on spending for other federal programs; we expect to include those effects in the near future, and we do not expect that they will have a sizable impact on our estimates. Finally, the budgetary information reflects many of the major cash flows that would affect the federal budget as a result of implementing the specified policies, and it provides our preliminary assessment of the proposal’s net effects on the federal budget deficit. Some additional cash flows would appear in the budget—either as outlays and offsetting receipts or outlays and revenues—but would net to zero and thus would not affect the deficit.
The estimate also does not include cost offsets, new taxes, unveiled today in the House Ways and Means Committee run by tax cheat, Charlie Rangel.
Democrats on Tuesday unveiled their proposal for a sweeping health care bill that would require all Americans to buy affordable insurance. The cost of the proposed legislation would be paid for by taxes on wealthy Americans.
The House Ways and Means Committee announced it would vote on the proposal beginning on Thursday. The panel is one of three that must act before the bill can go to the full House, probably later in the month.
The bill would impose a 5.4 percent federal surtax on couples earning more than $1 million annually and a 1.5 percent tax on couples earning between $500,000 and $1 million. Households earning more than $350,000 would get hit with a 1 percent tax.
House Democrats want to require individuals and employers to get health insurance — or pay a penalty. For individuals, the penalty would be 2.5 percent of income — but it could go no higher than the average cost of health insurance.
The penalty for employers would be much higher — 8 percent of a worker’s wages — with an exemption for small businesses. Business groups are strongly opposing an employer requirement.
Just exactly what our sinking economy needs, more taxes.