The big news this week on the health care front was the release of the Senate Finance Committee's initial draft of its health care legislation. The big interest in the budget world with this development is that it marked the first complete reform legislation with a score from CBO that shows deficit reduction, not only during the 10-year budget window but also in the years beyond.
While this is encouraging, there are a lot of caveats to keep in mind about where we are in the process. One is that the bill leaves out a quite expensive item--a fix to doctor payments under Medicare--that costs hundreds of billions. That "fix" is included in the House bill where it is not paid for. Another caveat is that the proposed Medicare Commission, an idea we at Concord support, is seemingly having more restrictions placed on it at every turn. Finally, the legislation still has a long way to go and just one amendment at some point could change the CBO scoring dramatically. Furthermore, the other bills the Finance Committee's have to be merged or conferenced with do not appear as fiscally responsible (especially in the out-years). All that said, it is good to see so much attention being given to the the costs of health care reform beyond the short-term budget window.
CBO director Elmendorf's blog is worth reading to learn about the main fiscal features of the bill. He also did an informative interview with Ezra Klein about how the CBO fits into the current legislative process.