The following article is from the new report from Senator Tom Coburn, M.D. and Senator John Barrasso, M.D., titled "Grim Diagnosis : A check-up on the federal health law". (press release) Thus far, we have posted both the report and sections of the report. This article illustrates the true costs and reports from the CBO on what the press and the American people now call "Obamacare". President Obama and those in Congress who supported the passage of this law are to be held accountable for the laws impact..... Read on...
Related: Hundreds of thousands will lose their jobs
( see full report with footnotes and references to content here)
While proponents of the health care law argued it would reduce the deficit, in reality, the new law will blow a hole in the federal budget.
Fewer than two in 10 Americans believe the health law will reduce the deficit, while more than six in 10 believe the overhaul will increase it.
Americans have ample basis to doubt the massive, 2,700 pages of legislation will decrease the deficit. The authors of the overhaul purposefully ignored the looming problem of Medicare physician reimbursements that could have added more than $250 billion to the law’s price tag and erased claims of deficit reduction. More recently, the official Actuary of the Centers for Medicare and Medicaid Services concluded it is “implausible” to pretend Congress will not avert pending Medicare cuts – cuts that if reversed, would increase spending and could further inflate the deficit. As the Actuary noted, “current law would require physician fee reductions totaling an estimated 30 percent over the next 3 years—an implausible result.”
“True Costs” of Overhaul Much Larger
CBO usually evaluates the relative costs or savings under legislation within the specific timeframe of decade, or the immediate ten-year “budget window.” The new law takes advantage of CBO methodology and is designed to downplay the true cost of the legislation. While taxes under the overhaul have already begun, the major insurance market changes are not effective until 2014. By effectively frontloading the tax increases and punting the largest insurance changes and spending increases to future years, the design of the overhaul masks the true costs of the health law. The chart nearby outlines how the raw spending in the health overhaul climbs dramatically in years to come. Using official government numbers, the real cost of the overhaul – once fully implemented over the course of a decade – is revealed to cost taxpayers more than two and a half trillion dollars.
Deficit Warnings from Budget Experts
Unfortunately, the health overhaul may well increase deficits and costs to federal taxpayers in the very near future. Doug Holtz-Eakin, who formerly served as CBO Director recently analyzed the legislation. Holtz-Eakin concluded the overhaul is “built on a shaky foundation of omitted costs, premiums shifted from other entitlements, and politically dubious spending cuts and revenue increases.” Mr. Holtz-Eakin suggested “a more comprehensive and realistic projection suggests that the new reform law will raise the deficit by more than $500 billion during the first ten years and by nearly $1.5 trillion in the following decade.”
Even the nonpartisan CBO effectively put a big asterisk on their official price tag of the overhaul. In analyzing the law, CBO carefully highlighted a few “key considerations” for Congress, pointing out that future deficit reduction projected under the law depended on “a number of policies that might be difficult to sustain over a long period of time.” CBO warned that the “long-term budgetary impact could be quite different if key provisions of the legislation were ultimately changed or not fully implemented.” CBO also identified tens of billions of additional dollars that may be spent by the federal government as a result of new programs and mandates in the health overhaul.
When evaluating budgetary claims about this legislation, Americans should consider Congress’ poor record of exercising fiscal restraint. Since the passage of the federal health care overhaul, Congress has added more than $110 billion to the deficit by waiving mandatory PAY-GO rules that would otherwise require Congress to pay for new spending. In little more than six months, Congress has nearly surpassed the supposed savings the legislation proponents say it will provide over the coming decade.
Official estimates have already shown that health care spending will increase under the law. Deficits could climb dangerously as well. Just two hundred days since its enactment, the reality is that the federal health care overhaul is on track to send federal spending skyrocketing and cause already perilously-large deficits to grow even bigger.
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