Tuesday, February 23, 2010

CBO Scuttebutt

One of the things that will be interesting to see with the President's new health care proposal (this is supposed to be a compromise between the Senate and House bills) is how the CBO treats it. At first blush it appears that the revenue and subsidy changes are modest and should only inflate the bill's 10 year budget number slightly. However, in the president's proposal the government would obtain the authority to reject rate hikes by insurers. This coupled with all of the other changes in the bill would in effect reduce insurers to public utilities. It is conceivable that the CBO would decide that premiums paid should thus be recorded on budget thus massively inflating the budget number.

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