July 30, 2010
INCORRECT CLAIMS ON NEW HEALTH CARE SAVINGS
The Obama administration continues to insist the new health care reform will reduce the federal budget deficit by $100 billion over 10 years and 10 times that amount in the second decade of implementation. They cite the Congressional Budget Office's (CBO) cost estimate to back their claims. But that's not the whole story about ObamaCare's budgetary implications, says James Capretta, fellow at the Ethics and Public Policy Center in Washington, D.C.
For starters, the CBO is not the only game in town. In the executive branch, the chief actuary of Medicare is supposed to provide the official health care cost projections for the administration. His cost estimate for the new health law differs in important ways from the one provided by CBO and calls into question every major contention the administration has advanced about the bill:
* The president says the legislation will slow the increase in costs; the chief actuary of Medicare says it won't.
* The president says people will get to keep their job-based plans if they want to; the actuary says 14 million people will lose their employer coverage, many of whom would certainly rather keep it than switch to an untested program.
* The president says the new law will improve the budget outlook; don't bet on it, says the chief actuary.
In addition, it's not the chief actuary's assignment to provide estimates of non-Medicare-related tax provisions, so his cost projections for ObamaCare do not capture all the needed budget data to estimate the full impact on the budget deficit. Using the Joint Tax Committee's estimates for the tax provisions missing from the chief actuary's report, $50 billion of deficit reduction alleged in the CBO report is wiped out, says Capretta.
And that's before the other gimmicks, double counting, and hidden costs are exposed and removed from the accounting, too, says Capretta.
Source: James Capretta, "False Claims on ObamaCare Savings," Heartland Institute, July 2010.