Is Health Care Reform Really Deficit Neutral?

Not if you include the cost of the "doc fix"—the permanent change to Medicare reimbursement rates for doctors—that the House yanked out of their reform package so that its bad fiscal news wouldn't show up in their allegedly deficit neutral health care bill. Here's the CBO, responding to a request from Congressman Paul Ryan, on what happens when you look at the total effects of both the doc fix and the reform bill in the House:

CBO estimates that enacting H.R. 3961 [the "doc fix"], by itself, would cost $210 billion over the 2010–2019 period. CBO and the staff of the Joint Committee on Taxation have separately estimated that enacting H.R. 3962 [the health care bill] would reduce federal budget deficits by $109 billion over that same period.

CBO estimates that enacting both bills would add $89 billion to budget deficits over the 2010–2019 period, somewhat less than the sum of the effects of enacting the bills separately because of interactions between their provisions. The agency estimates that the two bills together would increase the budget deficit in 2019 by $23 billion relative to current law, an increment that would grow in subsequent years.

Now, those numbers are reasonably small in comparison to the overall bill. But it's that last phrase—"an increment that would grow in subsequent years"—that is what's most important here. Not only would passing these two bills in combination (as House Democrats originally intended when they included them in a single bill) raise the deficit, it would produce lasting, expanding effects. The total result of reforms to our health care system, by the CBO's estimation, not only wouldn't be deficit neutral, but would actually create a new, long-term problem that's expected to get bigger over time.  

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    CBO estimates that enacting both bills would add $89 billion to budget deficits.

    Try multiplying that number by 10.

    If you're feeling optimistic.

  • ||

    I ask my little sister why she loves being lied to so much. She never has an answer.

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    The goose is cooked, and we approach financial zero hour. Take a look at MULT, TOTASL, RSBKCRNS, BOPI, and realize that taken together, they are roadsigns that we entering the zone where each new dollar of debt does not contribute to GDP.

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  • Gilbert||

    Better than ruffies!

  • ||

    This is quite valid criticism. I think the CBO tried to underestimate the effects of Medicare cost cutting provisions in the House bill, but even considering the "doc fix" they just passed, it's doubtful that many of fixes would stick even if they were implemented. It's funny how legislators biggest fear is a bunch of angry 65 y/o seniors.

  • OMG||

    Damn it ... we're missing the whole point. Arguing whether the doctor's fix is in or out concedes the idea that the estimate has any validity. What about social security, medicare, medicaid or almost all other government programs where the true numbers wound up being orders of magnitude greater than the estimate? But this time its different, right?

    It's like arguing about whether the moon is made out of green cheese or swiss - ITS NOT MADE OUT OF CHEESE

  • ||

    "Deficit nuetral" is really meaningless. Opponents of this monstrosity play into their hands by arguing about this point. You have to raise taxes by $800B+ in order for it to be "deficit-nuetral". Who cares if it's deficit nuetral after increasing taxes so much? The tax increases alone will crush the economy and the spending will of course be wasted. If it requires massive taxes, it's not nuetral.

  • J sub D||

    Is Health Care Reform Really Deficit Neutral?

    No.

    That light rail project will cost more than estimated to build, more than claimed to operate and have fewer riders than projected too.

  • ||

    You are obviously a Detroit-based tool of the auto industry.

    ;P

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    Hell yes. Buy a Ford (no bankruptcy, no bailout) and tell the government to screw itself.

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    No. Next question?

    ps- fuck you, "English only" squirrel.

  • ||

    Hell yes. Buy a Ford (no bankruptcy, no bailout)

    I won't buy a Ford (even though they weren't bailed out) for the same reason I won't buy Cuban cigars. Just as buying a Cuban cigar puts money into the hands of a maleficent force (Castro), buying a Ford puts money into the hands of a maleficent force (the UAW).

  • JPP||

    Only pols can consider a trillion dollar spending bill deficit neutral. As an individual, if my finances are in the red, all spending is suspect.

    http://other-road.blogspot.com.....rt_09.html

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