Fix Health Care Policy

The True Cost of the House Health Bill: $1.5 Trillion

Nancy Pelosi has unveiled the new health care bill in the House after merging together three different versions of legislation. To appease moderate Blue Dog Democrats and to meet President Obama’s oft-stated promise that reform wouldn’t cost more than $900 billion in the first ten years, Speaker Pelosi sought to reduce the $1.5 trillion total cost of the bill. Newsflash: she failed.

The Congressional Budget Office released its preliminary score of the bill and while some in the media have been reporting its net cost of $894 billion, the total cost of health reform legislation is more like $1.5 trillion. So, Speaker Pelosi is essentially right back where she started—with a huge (two) thousand page plan that carries a hefty price tag.

Donald Marron, former acting director of the Congressional Budget Office, calculates that through a variety of provisions there is about $217 billion in additional spending the House bill. The additional spending in the House bill brings the total cost of the House bill to $1.273 trillion, or almost $1.3 trillion in a ten year budget window.

And let’s not forget the infamous “doc fix” which prevent cuts in Medicare payments to physicians that would otherwise automatically take effect under the “sustainable growth rate formula” (SGR). Despite the Senate’s unsuccessful attempt to pass a permanent fix without paying for it, the House legislation also attempts to pull out the same $245 billion dollar plus provision from the legislative package to create the illusion that the price tag of the legislation is lower than it really is. The American people saw this budget gimmick before when it was tried in the Senate, who do the House leaders think they are fooling?

The House bill costs more than the President’s $900 billion dollar promise and its costs are in excess of $1 trillion. All told, the cost of “reform” legislation is still more than $1.5 trillion.

Tags: Medicaid, Nancy Pelosi, Obama Health Care Plan, Obama's failed stimulus