New report gives mixed review of Senate bill's provisions

The Senate's plan to expand health coverage to 34 million more Americans would raise costs slightly, government economic experts said in a new report.

Over time, cost-cutting measures could start to reduce the annual increases in healthcare spending, offering the possibility of substantial savings in the long run. At the same time, however, some of the Senate's Medicare savings could be unrealistic and cause lawmakers to roll them back, according to Medicare's top number-crunchers.

The study found that health spending, which accounts for about one-sixth of the economy, would increase by less that 1% over the coming decade even with so many more people receiving coverage.

HHS Secretary Kathleen Sebelius said the report shows the Senate bill would slow the rate of healthcare costs, strengthen Medicare and provide millions more people with insurance coverage.

House and Senate versions of the overhaul would require nearly all Americans to get coverage and provide subsidies for many who can't afford the cost, but they differ on the details. Among the remaining sticking points are whom to tax, how many people to cover, how to restrict taxpayer funding for abortion and whether illegal immigrants should be allowed to use their own money to buy coverage in new insurance markets.

Obama had several meetings with Democratic lawmakers at the White House this week to help resolve those differences. In one instance, he signaled to House Democratic leaders that they must drop their opposition to taxing high-end insurance plans to pay to extend coverage to millions of uninsured people. The tax, which is in the Senate bill, is largely opposed by House Democrats and organized labor.

The new report cited this tax on "Cadillac" health plans, as well as reductions in annual increases to Medicare providers, as having potential to hold down costs. But the authors were skeptical that Congress could stand the political fallout, noting that the Medicare cuts "may be unrealistic."

At the same time, the proposed 40% excise tax on high-cost health plans would hit more and more people over time, virtually guaranteeing lawmakers would feel pressure to ease the tax.

Republican lawmakers, saying the bills cost too much and impose too much government control, are near unanimous in opposing the legislation.

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