Another set of cooked books

New York Post
November 20, 2009

SENATE Majority Leader Harry Reid is touting the Senate’s latest health-care bill as costing $849 billion over 10 years. But this uses the same accounting trick as past versions: 99 percent of the costs don’t kick in until the fifth year of that “10-year” period. The true 10-year costs are well over twice what Reid’s advertising: $1.8 trillion.

The Democrats cite the bills’ projected costs from 2010-19. Yet, as the Congressional Budget Office reports, the bill would cost just $9 billion total from 2010 through 2013 — versus $147 billion in 2016 alone. In the first 40 percent of what the Democrats are calling the bill’s “first 10 years,” only 1 percent of its costs would yet have hit.

As the CBO analysis indicates, the bill’s real 10-year costs would start in 2014. And in its true first decade (2014 to 2023), the CBO projects the bill’s costs to be $1.8 trillion — double the price Reid is advertising.

And that’s even though the CBO optimistically assumes the government-run “public option” wouldn’t cost a cent.

Over this same 10-year span, the bill would hike taxes and fines by $892 billion — more than the alleged price of the bill.

Just as problematic are the bill’s effects on entitlement spending and deficits. Medicare is already teetering on the edge of insolvency. This year’s Medicare Trustees Report (signed by Health and Human Services Secretary Kathleen Sebelius) warns that the Medicare Hospital Trust Fund — the main funding channel for the largest part of Medicare — will become insolvent in 2017.

Worse, nearly four people are now paying into Medicare for every beneficiary. But with the baby boomers’ retirement fast approaching, that number will drop over the next 20 years to about 2½. Fewer and fewer people will be paying higher and higher costs.

Yet, as the CBO notes, in its real first decade, the bill would siphon $802 billion from Medicare to spend elsewhere. With its financial outlook already beyond bleak, Medicare is the last place to look to for “free” money.

Among the $802 billion that Reid would divert from Medicare is $431 billion in cuts in doctors’ pay (far more than the misleading figure for 2010-19). The bill says it would cut payments to doctors for services to Medicare patients by 23 percent in 2011 — and never raise them back up, ever.

The rest of the article is here.

Comments are closed.