By  on February 9, 1994

WASHINGTON -- The Congressional Budget Office said Tuesday that President Clinton's health care reform package would cost retailers about $1,300 more per year per worker.

The President's plan also could influence employers to hire more workers who are dependents, under 18 years old, or full-time students, because employers would not have to pay their health care costs, the CBO said.

The retail community is aligned against the President's proposal for the reasons stated in the report: Universal coverage would cost employers who don't insure their entire work force too much money and cost part-timers their jobs.

In what is essentially a highly mixed to negative message, the CBO report, however, claimed that overall Clinton's health care reform will save U.S. business $90 billion over 10 years, compared with current plans.

Still, the President's plan could cause some firms to increase their use of employees who work less than 40 hours per month, because their insurance costs wouldn't have to be borne by employers, the report said.

The costs of Clinton's ambitious reform effort ultimately would result in lower wages for workers, higher prices for consumers and smaller earnings for shareholders on their investments, the CBO said.

The CBO report contained further bad news for the White House in that it said the President's plan would hike the federal deficit by $74 billion over the next six years, not cut it by $59 billion as the White House forecast. Also, the CBO said that Clinton's program would require more subsidies for employers than initially projected, and that more low-wage workers would qualify for the promised subsidies.

The CBO also said the money employers would be required to pay for their workers' health care premiums should be included in the federal budget. According to the report, employer payments in 1996 would be about $30 billion, while the total amount to be collected under the plan that year would be $56 billion. By 2004, employers would be contributing $352 billion yearly to the nation's health care budget, the CBO said.

The report was unveiled at a hearing before the House Ways and Means Committee.

Committee chairman Rep. Dan Rostenkowski (D., Ill.), said the report "would please almost no one. We certainly have our work cut out for us."

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