Health Care and Taxes and Spending, Oh My!


Earlier today I noted that the Congressional Budget Office's rough score of the House's health care repeal bill projected that repealing the PPACA would increase the deficit. Given that the CBO had previously scored the health care overhaul as reducing the deficit, that's not surprising. This afternoon, the CBO provided a bit more information on the proposal's total revenue and spending effects to go with its score:

We have been asked to provide the revenue and direct spending components of that total. Extrapolating the estimated budgetary effects of the original health care legislation and accounting for the effects of subsequent legislation, CBO anticipates that enacting H.R. 2 would probably yield, for the 2012-2021 period, a reduction in revenues in the neighborhood of $770 billion and a reduction in outlays in the vicinity of $540 billion, plus or minus the effects of forthcoming technical and economic changes to CBO's and JCT's projections. [bold added]

Republicans asked for these figures, and they are currently sending them around to the media. But in a way, this update isn't terribly revealing. Tabling the law's budget gimmickry for a moment, it's straightforward addition and subtraction: If you get rid of a lot of spending but get rid of even more revenue—otherwise known as taxes—you'll end up making the deficit larger. At the same time, it does effectively highlight the fiscal foundation on which the health care overhaul was built: A big spending increase, and a giant chunk of added tax revenue.


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  1. shouldn’t we only count 6 years of the lost revenue vs. 10 years of the lower spending?

    1. No, it’s the other way around. That $230 billion, if it every really came to be, would be totally wiped out by an addition four years of bennies being paid out.

  2. A golden opportunity for the budget cutters, here. Take the Dems at their word, that we also need to cut an additional $230BB over 10 years to make the books balance.

    OK, if you insist. . . .

  3. You know what Suderman, you’re really starting to piss me off with this alt-text thing.

  4. In fact, under new health care reform your health insurance company will no longer be allowed to cancel your policy if you get sick, we should be doing this already! search online “Wise Health Insurance” it is a good place to find insurance if you have illness like me.

    1. In fact, under new health care reform your health insurance company will no longer be allowed to cancel your policy if you get sick, we should be doing this already!

      Its already a breach of contract for a health insurance company to cancel a policy as long as you are current on your payments, regardless of whether you “get sick”.

      Now, if you were already sick when you signed up, and lied about it . . . .

    2. I’ve heard all the anecdotal horror stories about evil insurance companies refusing to cover those with pre-existing conditions or simply weaseling out of paying benefits.

      Let’s assume it’s all true. It still wouldn’t justify passing a sweeping Federal law like PPACA. Such problems could be addressed with specific legislation at the state level.

  5. They just rolled the dice on a tax cut only fiscal policy. Who knows, maybe it won’t come up craps on the job front, this time, like it has in the past?

    I would choose a policy that has worked to create employment in the past, myself, but that may be because I’m a radical extremist.

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  6. You guys think it’s bad now? Wait to see what happens if Obama’s new health care plan kicks in. Taxes will sky-rocket, and what you can and can’t do in terms of health care will be put into the hands of big bureaucrats. Americans should be able to have choices and exercise our freedom, especially when it comes to medical care. Tell your Congressmen and women, as well as senators, that the new Obamacare must be repealed.

    Go to http://www.theRepealPledge.com to learn more.

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