Tuesday, May 13, 2008

Universal Health Care for Free!

The Congressional Budget Office has scored the Healthy Americans Act as budget neutral. Politically speaking, this is a very exciting development and bound to get a lot of attention if publicized properly. No matter how much money we throw down the drain in the current system, it's very difficult to get Congress to invest in a policy with a large up front price tag no matter how much it saves in the long term. But who can turn down free universal coverage?

Unfortunately, this positive calculation comes partly because of a cap on government spending. After a certain year (2014 I believe) Federal spending will be capped at GDP growth. This cap may very well scare a number of groups that are concerned that a cap will lead to a decline in overall care or the particular disease or medical technique they advocate for. As I covered in a previous post that focuses mostly on a similar policy from the Committee for Economic Development, cost cutting should come from increased competition between insurance companies and preventative care. The Healthy Americans Act is similar enough to the Committee for Economic Development plan that the cap is probably unnecessary.

Still, I think this is an overall win for the Healthy Americans Act. From what I've seen Sen. Wyden is a savvy political player and probably knew what he was doing when he put in the cap on Federal expenditures. Without the cap, the CBO would not be able to issue an estimate so soon because of the complexities involved in seeing whether the incentives generated by the bill will create true cost cutting. This estimate generate a lot of publicity, and even if it gets people quibbling over details, at the very least they'll be talking about it as a new president enters the White House.