Pelosi's Strong Public Option Reduces Deficit

Public Option is Cost Effective, Reduces Deficit

A preliminary analysis from CBO may have sealed the deal. Speaker Nancy Pelosi is preparing to move ahead with a "robust" public option--one that reimburses hospitals and providers at Medicare rates, plus five percent--in the House's health care bill. She is briefing her caucus about the plan's savings tonight, and, pending the approval of a sufficient majority of members, will adopt the measure as part of the complete reform package.

A preliminary estimate from the Congressional Budget Office projects that the House Democrats' health care plan that includes a public option would cost $871 billion over 10 years, according to two Democratic sources. CBO also found that the Democrats' bill reduces the deficit in the first 10 years. analysis finds the reconstituted House proposal to be deficit neutral, and require less than $900 billion in new spending, over ten years.

The bill remains nominally more expensive than the Senate Finance Committee proposal, but would cover 96 percent of all Americans, providing greater bang for each federal dollar spent. And, aides note, the bill that comes to the floor of the Senate will be a hybrid of the Finance and more expensive HELP Committee bills, so the price is expected to rise.

The move is sure to make progressives ecstatic, and puts Senate leaders, who have been unable to reach any decisions about their preferences for a public option in their own bill, in an uncomfortable position. Senior Democratic aides told CNN that House Democratic leaders are likely to put this version of the public option favored by liberal Democrats in the final bill they are drafting. While no final decision has been made, on Tuesday night Speaker Pelosi made the case to House Democrats that this approach saves the most money and would put the House in a better negotiating position when it comes time to negotiate a final health care bill with the Senate.

sources: CNN, TPM











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