5 Spending Bill 'Pay Fors' That Could Affect Your World

Analysts at the Congressional Budget Office have cast their vote on H.R. 5376 — the 2,135-page Build Back Better social spending bill.

CBO analysts predicted Thursday that H.R. 5376 will increase federal spending about $1.6 trillion over the 10-year period from 2022 through 2031, and increase federal revenue by $1.3 trillion over that period.

The U.S. government spends about $4.2 trillion per year. H.R. 5376 could increase spending by an average of 2.2% per year and revenue by an average of 3% per year.

The pay-fors come on top of bill provisions that could reduce federal spending by, for example, letting Medicare program managers negotiate lower prices with prescription drug manufacturers.

Pay-For Memories

H.R. 5376 passed Friday by a narrow, 220-213 vote in the House. All Republicans who participated voted against the bill, and all Democrats but one voted for it. Rep. Jared Golden, D-Maine, was the only Democrat who crossed party lines to vote against it.

The prospects of the bill in the Senate are unclear. Even if the bill fails, lawmakers could remember the CBO’s pay-for revenue estimates when looking for ideas about how to pay for future efforts to expand federal programs or cut federal taxes.

Some of the provisions that would have a big effect on insurers that write life insurance, annuities or health insurance would target the finances of affluent clients.

Other pay-fors would raise the taxes of all companies and affect insurers indirectly. Insurers account for more than 10% of U.S. gross domestic product, and it seems likely that insurers could be on the hook for more than 10% of the revenue coming from general corporate tax increases.