Senate committee delays ObamaCare for CBO cost analysis

The Senate Finance Committee bowed to pressure from members and constituents alike in postponing a vote on the Baucus plan for overhauling the American health-care system.  Democrats had tried to push the bill out of committee before the Congressional Budget Office could review the proposal and project its costs, fearing that another harsh analysis could kill the Senate effort before it has a chance for a floor vote.  With its gimmicky excise tax on insurers offering “Cadillac plans” and the Chairman’s Mark fee, the chances of a positive analysis seems mighty slim:

Senators learned Monday that a committee vote on health-care reform will be pushed back to later this week, and perhaps into next week, as they await an estimate on how much the overhaul would cost.

But if the news of the delayed vote disappointed them, Democratic leaders in the Senate took heart from pro-reform statements from some high-profile Republicans, including former Senate majority leader Bill Frist and former health and human services secretary Tommy G. Thompson.

The Senate Finance Committee wrapped up work Friday on a reform bill, but committee Chairman Max Baucus (D-Mont.) promised his members that before voting they would have a “reasonable” amount of time to review the bill’s price tag, as assessed by the nonpartisan Congressional Budget Office. That report, committee aides said Monday, will arrive later than expected.

The panel’s vote is expected to be close, and passage could hinge on a handful of senators who have indicated that the CBO’s report may sway them.

The SFC had little choice but to wait for the scoring.  Barack Obama set the bar in his speech to the joint session last month in which he demanded a bill that would not add to the deficit.  Since the CBO has firmly insisted that the House versions of ObamaCare explode the deficit in the short and long terms, the pressure for a deficit-neutral approach has landed on the Senate, and the Baucus plan appears to be the Democrats’ last hope for it.

However, Baucus relies on some very unlikely funding for his plan, which the CBO will certainly view with a jaundiced eye.  The CBO has shown a willingness to use dynamic tax analysis to project future revenues from other proposals on health-care reform, which in this case would challenge most if not all of the expected $259 billion Baucus expects to get from his “Cadillac-plan” excise fee.  If that revenue stream disappears, then the Baucus plan will actually perform worse than the House bills, even without the public option, in regards to deficits.

The CBO will also want to look at the subsidies in the Baucus plan.  As I reported earlier today, the Joint Committee on Taxation projects that the refundables from health-care exchanges will exceed total tax liabilities on individuals in 72% of all returns.  That means that taxpayers will have to find $330 billion cash in giveaways.  Where does that money originate?  Who pays?  The CBO will want to answer those questions in order to score it against deficit expansion.

Small wonder some Democrats wanted to rush this out of committee without a CBO analysis.  However, a season of outrage from constituents has belatedly taught enough of the Beltway denizens that taxpayers don’t want to buy a pig in a poke.  We will see what happens when the CBO scoring hits, and I’d predict that it won’t be pretty for Democrats — and they know it too, or they wouldn’t have attempted to sell us that pig in a poke in the first place.

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