CBO scores on health bills raise questions

Sep 25 2009

Various news outlets are examining the Congressional Budget Office's analysis of the cost of health bills.

"Senate Democrats are trumpeting their claim that the Senate Finance Committee's emerging bill to overhaul health care appears to reduce federal deficits over the next 10 years — but that projection is uncertain at best," McClatchy reports. The cost estimate comes from the CBO "with enough qualifiers to raise a lot of doubts." Estimates are always "subject to the usual variables — changes in consumer behavior, economic conditions, and new laws — but this time, there's another: The committee, which began debating and revising the plan this week, is working off a conceptual framework, not an actual bill. Even when the panel takes a final vote ... there likely will be no legislative language — making it much harder for CBO to deliver a realistic cost estimate." The Senate Finance Committee does not work from drafts of actual bills, the way most committees do, which "adds another layer of uncertainty to an already murky process" (Lightman, 9/24).

Bloomberg: "[T]he more sweeping the proposal, the more likely its estimates will miss the mark because on such legislation the agency has the least amount of data, CBO Director Doug Elmendorf said. 'When Congress is considering incremental changes to policies, and especially incremental changes that are similar to ones that have been made before, then there's a history that we and other analysts can consult,' Elmendorf, 47, said in an interview. With 'more dramatic or novel changes in policy, there's no previous experience to refer to.' As the nonpartisan agency reviews plans to carry out the most extensive overhaul of the medical-care system in more than four decades, 'the range of uncertainty around our estimates of health-reform proposals is very large,' he said" (Faler, 9/24).