Improving access to health insurance: $1 trillion

[CG51]

The Congressional Budget Office offers preliminary estimates of 2 key provisions in a bill from Democrats on the Senate health committee. (http://money.cnn.com/2009/06/15/news/economy/health_care_reform/index.htm?postversion=2009061518)

NEW YORK (CNNMoney.com) -- Two key proposals to improve access to health insurance could reduce the ranks of the uninsured but cost $1 trillion over 10 years, according to preliminary estimates released Monday by the Congressional Budget Office.

The estimates are the first in a series over the next few months that will attempt to quantify the costs and benefits of various health reform options. President Obama, citing the huge part health care spending plays in the economy, has made passing reform this year a top priority.

The report by CBO, an independent agency that scores legislative proposals for lawmakers, focuses on proposals to create health insurance exchanges and subsidize the cost of insurance for some households.

The agency estimated that the exchange and subsidies could reduce the number of uninsured people by roughly 16 million by 2015. It is estimated there would otherwise be 51 million uninsured that year.

The CBO estimates are based on parts of a health reform bill from Democrats on the Senate's Health, Education, Labor and Pension Committee, chaired by Sen. Ted Kennedy, D-Mass.

The committee will start debating and amending that bill on Wednesday.
Under the bill, the federal government would give grants to states to set up insurance exchanges that consumers could use to comparison shop for health insurance. And it would offer subsidies of varying levels to help families with incomes up to 500% of poverty level (roughly $110,000) to pay for coverage.

The federal government would also subsidize small businesses that offer health benefits but have workers with low wages.

The CBO stressed that its estimates are preliminary for several reasons:


They only reflect analysis of one part of the health committee bill. So they aren't a comprehensive look at the potential costs and savings of all measures in that bill.
They do not reflect the likely interactions that will occur with other elements of comprehensive health reform that may be included -- such as an expansion of Medicaid or the creation of a public insurance plan, which is the most controversial (http://money.cnn.com/2009/06/09/news/economy/health_care_reform/index.htm?postversion=2009060916) issue in the health reform debate.
In addition, the CBO has not yet finished its analysis of all the bill's elements, such as a proposal to let parents cover their children as dependents until they're 27.

The health committee bill is hardly the last word on health reform. Other congressional committees have jurisdiction over other parts of health care reform.

One is the Senate Finance Committee, which will oversee the tax proposals (http://money.cnn.com/2009/06/13/news/economy/health_care_reform/index.htm?postversion=2009061513) intended to help pay for the overhaul of the health care system.

The finance panel's chairman, Sen. Max Baucus, D-Mont., is expected to release a draft of his health reform bill this week. http://i.cdn.turner.com/money/images/bug.gif (http://money.cnn.com/2009/06/15/news/economy/health_care_reform/index.htm?postversion=2009061518#TOP)

[2Sheds_Jackson]

Obama made a pledge to fix the healthcare system, so he's got to deliver. Where do we come up with $1 trillion? Do we raise taxes? Do we borrow it and make our kids repay it with interest (keeping in mind of course that they're already paying for all the bailouts and our social security bennies)? Do we put some kind of a cap on the healthcare industry?

[SonKev]

I dont think our dollar will live threw this one...

[Conman]

Sad thing is that I no longer convulse when a trillion is just spouted off like that. A trillion has replaced the billion as the new watershed mark as far as costs and spending.

Gone are the days when a deficit of a couple hundred billion was pretty bad. Now it will be a good day when the deficit has been reduced to around a trillion.

And that, I think, is the most damaging thing this economic crisis has brought to us.

[deagle]

well, at least its money invested in our own citizens.

[annihilation]

I dont think our dollar will live threw this one...


Or dollar has been taking a beating since 2001 and it will continue to do so.

[CG51]

well, at least its money invested in our own citizens.

You mean constituents?

[LaoSexMachine]

Better then pissing it away as 'foreign aid' I guess.

[brainplay]

Better then pissing it away as 'foreign aid' I guess.

Uh...that would of course mean that we would stop or even slow the amount of foreign aid already given out on a regular basis. That doesn't seem to be the case.

[Igor]

Boohoo. They're spending a hundred billion a year on the people instead of tax cuts for rich ****s. The military will cost 8 trillion over the next 10 years (800 billion a year) but nobody seems to care about that. Nobody's asking where that 8 trillion will come from. Because there is always money for war! Yes, you can never spend too much on ways to kill people! But spend even a single cent on the people, and you're instantly Stalin in disguise.

[brainplay]

Boohoo. They're spending a hundred billion a year on the people instead of tax cuts for rich ****s. The military will cost 8 trillion over the next 10 years (800 billion a year) but nobody seems to care about that. Nobody's asking where that 8 trillion will come from. Because there is always money for war! Yes, you can never spend too much on ways to kill people! But spend even a single cent on the people, and you're instantly Stalin in disguise.

Well first of all they're SPENDING a hundred billion a year on people. But they're removing the tax cuts from the rich and businesses who already pay the majority of the nations taxes. Unlike a tax break, this kind of spending isn't going to provide incentive to be productive nor will it grow the economy.

8 trillion over the next 10 years? You got a link to show how you came up with that number? Lets try something a bit more realistic.


The total economic impact of the wars in Iraq and Afghanistan is estimated at $1.6 trillion by 2009, a congressional committee said in a report released Tuesday.http://www.cnn.com/2007/POLITICS/11/13/hidden.war.costs/

Christ, we spend that much in a single year on health care in the US.

[Igor]

Actually, i was wrong on the 8 trillion, it's "only" 5.13 trillion over the next 10 years. I get this figure from the annual military budget, which is 513 billion, as you can see here:

http://www.nationmaster.com/country/us-united-states/mil-military


And about the rich and businesses paying most of the taxes: Well of course they do, they have most of the money. When the top 10% of the population own more than 50% of all the wealth, they obviously pay 50% of all the taxes. Does this mean they're taxed too highly? No, it simply means they're greedy and control a disproportionate amount of resources. And who says health spending doesn't improve the economy? First, it creates jobs.

More jobs = more consumption and more money spent. More consumption means more demand. More demand means the economy grows. Then there are the indirect benefits of a healthier workforce, who take less sick days and are more productive due to their increased health, which means a better economy. And a tax cut in the middle of a DEPRESSION is suicide. Not only would a tax cut increase the deficit even more, it won't stimulate the economy as much as direct spending. The problem in a depression is that nobody's buying anything, forcing companies to fire people. This means those people who get fired will buy even less to save money, and the ones who still have their jobs will also cut down on their spending as a sort of insurance in case they too get fired. This means less profits for companies, which forces them to fire even more people. And so the cycle continues.


The only way to break the cycle is to restore confidence. Instill a confidence in the future, and in the economy so that people will start spending again. Basically, you have to make people not be afraid of losing their jobs so they won't have to cut back on their spending to create a "safety net" in case they do get fired. And you have to give economic aid to the ones who did lose their jobs so they can keep their consumption up, which will restore confidence in the business owners that people are once again buying their products, so they can start hiring people again. Tax cuts accomplish none of these. They just give money to the people who already have it, when you should be giving it to the ones who don't, since they'll consume the most, and thus stimulate the economy the most.

[brainplay]

Actually, i was wrong on the 8 trillion, it's "only" 5.13 trillion over the next 10 years. I get this figure from the annual military budget, which is 513 billion, as you can see here:

http://www.nationmaster.com/country/us-united-states/mil-military


And about the rich and businesses paying most of the taxes: Well of course they do, they have most of the money. When the top 10% of the population own more than 50% of all the wealth, they obviously pay 50% of all the taxes. Does this mean they're taxed too highly? No, it simply means they're greedy and control a disproportionate amount of resources. And who says health spending doesn't improve the economy? First, it creates jobs.

More jobs = more consumption and more money spent. More consumption means more demand. More demand means the economy grows. Then there are the indirect benefits of a healthier workforce, who take less sick days and are more productive due to their increased health, which means a better economy. And a tax cut in the middle of a DEPRESSION is suicide. Not only would a tax cut increase the deficit even more, it won't stimulate the economy as much as direct spending. The problem in a depression is that nobody's buying anything, forcing companies to fire people. This means those people who get fired will buy even less to save money, and the ones who still have their jobs will also cut down on their spending as a sort of insurance in case they too get fired. This means less profits for companies, which forces them to fire even more people. And so the cycle continues.


The only way to break the cycle is to restore confidence. Instill a confidence in the future, and in the economy so that people will start spending again. Basically, you have to make people not be afraid of losing their jobs so they won't have to cut back on their spending to create a "safety net" in case they do get fired. And you have to give economic aid to the ones who did lose their jobs so they can keep their consumption up, which will restore confidence in the business owners that people are once again buying their products, so they can start hiring people again. Tax cuts accomplish none of these. They just give money to the people who already have it, when you should be giving it to the ones who don't, since they'll consume the most, and thus stimulate the economy the most.


The 513 billion is the budget plus liquid assets. Meaning total worth of all tank, jets, aircraft carriers, rifles, etc minus depreciation each year if we sold it off at a garage sale (wonder how much an Aegis frigate would go for after depreciation?).

Second, health care subsidizing does not create jobs nor does it make people healthier by default. The UK workforce never showed huge gains when the NHS went into effect. And there is nothing to show that it will be any different in the US. At best it can sustain current jobs but as long as the health care industry has to live under current tort laws its still going to be expensive. Heck, insuring hospitals against malpractice would bring down prices like a lead weight.

Second, where do you get off calling this a depression? Do you see any soup lines? Farmers burning crops because they can't sell or 30% unemployment?

Third, tax revenue is not the economy. Taxes are a removal of wealth/money from the economy into the government in exchange for services. Taxing businesses (because using "the rich" is a cheap class warfare shot) removes more wealth/money causing a greater burden they have to shoulder. Since labor is the greatest overhead in a business...guess which is the first to go when profits start dropping? That happens whether you're in a recession or in an economic boom.

And finally
Does this mean they're taxed too highly? No, it simply means they're greedy and control a disproportionate amount of resources.Wut? Greedy? Disproportionate? Maybe we should spread the wealth a bit? You know, to those that really never earned it? To those in an obsolete low skill labor pool who refuse to re-educate or even become educated in the first place? To those who when making a mistake costs the company $0.50 or increases profits by $1.25per hour as opposed to the billiionaires who when making a mistake can cost millions of dollars and hundreds of jobs or increase profit in the millions and expand a workforce?

This isn't college dude. Welcome to the real world.