Nationwide Health Spending to Rise Slightly Under ObamaCare


Another day, another government report showing that the new health care law will increase total U.S. health spending over the next decade. This one, a mid-year update to the February report released by the Centers for Medicare and Medicaid Services, found that the rise will probably only be, as 50 Cent might say, just a lil' bit—about 0.2 percent compared with the projected increase if the law had not passed. The White House seems fairly pleased with the report, saying that it shows that the health care overhaul will expand insurance coverage and reduce the average cost of insurance per insured individual. Well, sure. If you increase spending somewhat but spread it across a larger population, then the average goes down. But averages don't tell you which parts of that population are likely to shoulder the bulk of the cost burden, and there's no indication of what the actual distribution will look like.

And, it's worth noting, the 0.2 percent spike estimate is rather hopeful. That projection relies on at least one rather dubious assumption—that Congress will actually allow a schedule 23 percent reduction in Medicare doctor payments this December. But there's virtually no reason to believe those cuts will occur; the law calling for those cuts has been in place for over a decade, and every year since 2003, Congress has overridden the law—and frequently in favor of payment hikes.