CBO Health-Care Score Assumes Congress Sticks to Its Promises, Which Probably Won't Happen, Says CBO

The House released its health-care reform bill yesterday morning, and by afternoon, the Congressional Budget Office had released a score. The big headline estimate is that the bill would result in a net reduction of the federal deficit by $104 billion by 2019, and that the bill would continue to slightly reduce the deficit over the following decade. But as always, the real story is the passage at the end of the CBO's summary:

Those longer-term projections assume that the provisions of H.R. 3962 are enacted and remain unchanged throughout the next two decades, which is often not the case for major legislation. For example, the "sustainable growth rate" mechanism governing Medicare's payments to physicians has frequently been modified to avoid reductions in those payments, and legislation to do so again is currently under consideration in the Congress. The bill would put into effect (or leave in effect) a number of procedures that might be difficult to maintain over a long period of time. It would leave in place the 21 percent reduction in the payment rates for physicians currently scheduled for 2010. At the same time, the bill includes a number of provisions that would constrain payment rates for other providers of Medicare services. In particular, increases in payment rates for many providers would be held below the rate of inflation (in expectation of ongoing productivity improvements in the delivery of health care).

This is about as strong a warning as I can imagine coming from the extremely reserved and cautious CBO, and it essentially amounts to the office saying (once again) that the only way this bill might prove deficit neutral is if it's followed to the letter—and that's unlikely to happen.

The American Spectator's Phil Klein has more analysis here.