July 27th, 2009
06:31 PM ET
13 years ago

New CBO study: Public health care option won't dominate system

WASHINGTON (CNN) - House Democrats on Monday hailed a new report by the non-partisan Congressional Budget Office that they said proves Republicans are misinforming the public about the effects of health care reform.

House Speaker Nancy Pelosi and other party leaders said at a news conference the report shows that a government-funded public option for health insurance would increase the number of people getting employer-provided coverage. Most Republicans contend a government option would wipe out private competitors.

"We've heard that the reform would represent a government takeover of health care," House Majority Leader Steny Hoyer of Maryland said of Republican claims. "In point of fact, exactly the opposite is true."

Pelosi repeated her insistence that the chamber would pass a bill that contains the public option, but she softened on the timing, saying it would happen when appropriate. Previously, Pelosi had pushed for a House vote on the measure before the chamber goes on August recess at the end of this week.

"I said I wanted a bill to pass before the recess. I've also said members need the time they need to not only get the bill written and also to review it," Pelosi noted, adding that House members need to see what direction the Senate is heading on its proposals.

"We're on schedule to either do it now or do it whenever," the California legislator said.

Two House committees have passed the bill drafted by Democrats, but a third - the Energy and Commerce Committee - has been delayed by cost concerns raised by fiscally conservative Democrats known as the Blue Dogs.

Pelosi said Monday the Energy and Commerce Committee would proceed with its debate on the bill, and a committee spokeswoman told CNN the panel would begin its work this week.

Asked about a specific day, the spokeswoman would say only that Committee Chairman Rep. Henry Waxman of California is "optimistic" that the panel could complete its work on the measure before the August break begins Friday.

Waxman and Blue Dog Democrats agreed last week on creating an independent panel of health care experts to review the Medicare reimbursement system with an eye toward cutting costs. The Congressional Budget Office, however, said that provision is unlikely to bring significant savings.

A separate budget office report made public Monday found that a health care reform bill that includes a public option sought by Democrats would result in 3 million more people enrolled in employer-sponsored coverage by 2016, compared with what would happen under current laws. The report, responding to questions from Rep. Dave Camp, R-Michigan, was not a final review, the office said.

Pelosi seized on its findings, declaring: "The CBO has ... disputed claims made by the Republicans about what our legislation will do."

Hoyer said the Republican claim that a public option would reduce health insurance choices also is wrong, according to the budget office analysis.

"Republicans are making ridiculous claims, frankly, about reform because they know that the status quo cannot be defended," Hoyer said.

However, a leading House Republican, Rep. Eric Cantor of Virginia, told CNN on Monday that a government-funded health insurance program would have a competitive advantage over private insurers.

"I don't think anybody believes that you can have the government compete with the private sector," Cantor said. "There just can't be an even playing field."

The House bill includes Democratic proposals for a public option, mandates for people to be insured and for employers to provide coverage, and an end to lack of coverage due to a pre-existing condition.

Republicans oppose a government-funded option and any requirement for employers to provide coverage. They also call for limits on medical malpractice lawsuits, which Democrats don't favor, along with a number of provisions contained in the Democratic bills, including increased efficiency in Medicare and Medicaid and a focus on preventive health programs.

On the Senate side, a key member of health care negotiations in the Finance Committee says his party lacks the votes to pass a bill through Congress on its own.

Sen. Kent Conrad of North Dakota said on the ABC program "This Week" on Sunday it was "not possible, and perhaps not desirable" for Democrats to push through a bill without Republican support.

Conrad is one of a handful of Senate Finance Committee members - Democrats and Republicans - negotiating a compromise bill that would be the first bipartisan health care proposal.

The Finance Committee version lacks a public insurance option included in a Democratic version already passed by the Senate Health, Education, Labor and Pensions Committee. That committee's measure is similar to the House bill.

Conrad has proposed an alternative to the public option that calls for health insurance cooperatives that could arrange collective coverage for members. He said such non-profit cooperatives would provide competition for private insurers while avoiding the Republican concern of government-funded programs monopolizing the health insurance market.

"There is an alternative that puts forth the best of both sides," Conrad said.

Republican Sen. Jim DeMint of South Carolina indicated such a compromise could appeal to his party.

"We can have a plan in a few weeks if the goal is not a government takeover," DeMint said on "This Week."

The U.S. Chamber of Commerce on Monday released a letter to Senate Finance Committee leaders Max Baucus, D-Montana, and Charles Grassley, R-Iowa, urging them to complete their bipartisan proposal before the August recess. The chamber, considered politically conservative, said the country needs a bipartisan alternative to the House bill and its government-funded private option, which the chamber opposes.

Back in the House, the Blue Dog Democrats have enough votes on the Energy and Commerce panel to prevent the bill from moving forward.

The Congressional Budget Office previously predicted the House bill would cost more than $1 trillion over 10 years, and end up increasing the federal deficit by $239 billion in that period. Supporters of the bill contend the office's analysis failed to factor in all spending cuts, such as reduced costs due to planned preventive care programs.

Once each chamber passes a bill, a conference committee will merge the two measures into a single proposal that would have to win approval from both houses before going to Obama. The president wants a bill on his desk this year to take advantage of the momentum of his new administration and avoid the thornier political climate of mid-term congressional elections in 2010.

–CNN's Dana Bash and Ted Barrett contributed to this story

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