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CBO Report Could Be Turning Point

The path of President Obama’s health care reform thus far has been very bumpy and full of sharp, unexpected turns. But this week, the path may have gotten a bit smoother and a bit clearer.

First, the non-partisan Congressional Budget Office yesterday ruled that the Senate health care plan–commonly referred to as the Baucus plan, named for Montana Sen. Max Baucus–with its 10-year estimated price tag of $829 billion does, in fact, meet Obama’s “budget-neutral” promise. Here’s the CBO report’s language and specific figures in terms of costs and revenue offsets:

[E]nacting the Chairman’s mark, as amended, would result in a net reduction in federal budget deficits of $81 billion over the 2010–2019 period (see Table 1). The estimate includes a projected net cost of $518 billion over 10 years for the proposed expansions in insurance coverage. That net cost itself reflects a gross total of $829 billion in credits and subsidies provided through the exchanges, increased net outlays for Medicaid and the Children’s Health Insurance Program (CHIP), and tax credits for small employers; those costs are partly offset by $201 billion in revenues from the excise tax on high-premium insurance plans and $110 billion in net savings from other sources. The net cost of the coverage expansions would be more than offset by the combination of other spending changes that CBO estimates would save $404 billion over the 10 years and other provisions that JCT and CBO estimate would increase federal revenues by $196 billion over the same period.

Then, earlier today, Senate Majority Leader Harry Reid announced that the Senate Finance Committee will vote Tuesday on the Baucus Bill. On the other side of the aisle, Speaker Nancy Pelosi has sent three House bill versions to the CBO seeking similar budgeting assessments.

The CBO scoring is important rhetorically. It provides political cover for those who want to support the bill but do not want to expand deficits or explain to voters why they are voting for “bigger government.” Carrie Budoff Brown of the Politico writes today:

[T]he analysis was as good as the White House or Senate Majority Leader Harry Reid (D-Nev.) could have wanted. The Baucus bill came in under budget, covers 94 percent of American citizens, reduces the deficit by $81 billion after 10 years and continues to rack up savings in the second 10 years.

The estimate removes a major hurdle toward a vote in the committee, because senators ­— in particular, Sen. Olympia Snowe of Maine, who could be the only Republican senator to support the legislation — said they needed to see the cost breakdown before taking up the bill.

Meanwhile, two more good pieces of news for Obama. First, a new Quinnipiac poll shows voters moving toward him and away from congressional Republicans on the health care issue. Second, and perhaps relatedly, the latest AP-GfK poll shows Obama jumping from +1 net approval a month ago (50 percent approving, 49 percent disapproving) to +17 (56 percent approving, 39 percent disapproving) now. As for his specific ratings on health care, he’s net-plus again (but narrowly, 48 percent to 47 percent), after being down 10 points a month ago.

The Administration is not home yet. But to continue an already bad metaphor, this may be remembered as the week Obama turned the corner.