CBO Says Public Health Care Proposal Wouldn’t Endanger Private Plans
July 28, 2009 – As federal lawmakers wrangle over proposed changes to how Americans obtain health care, the Congressional Budget Office recently said the creation of public health insurance exchanges would not drastically impact private health insurers in the United States.
In a July 26 letter to U.S. Rep. Dave Camp (R-Midland), the Congressional Budget Office estimated between 11 million and 12 million U.S. citizens would opt for a proposed public health insurance plan and not place private health insurers at risk of going out of business. The nonpartisan federal entity estimated some 6 million people opting for a public health care plan would receive health care benefits through the creation of public health insurance exchanges.
Camp sought clarification from the Congressional Budget Office after a private health research company earlier estimated at least 100 million U.S. citizens would opt for a public health care plan proposed by House Democrats. Discrepancies in the estimates result from the Congressional Budget Office estimating the proposed public health care plan would be about 10 percent less costly than current private health insurers’ plans while the Lewin Group based its estimate on the proposed plan costing about 20 percent less than private plans.
The Congressional Budget Office also bases its estimates on only workers at companies employing fewer than 50 being eligible for public plan participation while the Lewis Group’s estimates are based on all workers eventually being allowed to participate in the less costly health insurance exchanges.
Several federal lawmakers supporting the creation of a public insurance exchange cited the Congressional Budget Office estimates as proof a public insurance plan would not be overwhelmed by tens of millions of Americans signing up for coverage, but an independent public policy organization suggests the Congressional Budget Office’s numbers are optimistically low. If companies employing fewer than 50 people are allowed to opt into the proposed public health insurance exchanges, the nonpartisan Urban Institute estimates about 47 million Americans would choose the public plan.
Currently, more than 160 million workers and their family members obtain health care coverage through their employers. But without health care reform, the Urban Institute estimates more than 60 million Americans will have no health insurance coverage 10 years from now and the number of “non-elderly” persons using Medicaid would increase to more than 50 million. Currently, about 44 million Americans too young to qualify for Medicare instead use Medicaid to cover their health care needs.
While estimates of the potential impact of a public health insurance option are debated, the Senate Finance Committee is considering a plan that does away with a public health insurance component, according to a July 27 Associated Press report. Instead of creating a public health insurance option, the Senate panel is considering mandating private health insurers extend coverage to people with pre-existing medical conditions without increasing health insurance rates.
President Barack Obama initially demanded health care reform legislation be completed by August, but several federal lawmakers said the President’s deadline likely won’t be met to allow for more deliberation and hammer out a plan capable of garnering bipartisan support.
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