Fix Health Care Policy

How Much More Can They Get Wrong? The New Obamacare Impact Calculator Answers

There’s been a lot of misinformation when it comes to the new health care law—but not in the way Obamacare supporters have been claiming. We heard early on in the health reform debate that a massive overhaul of the private health care sector would bend the health care cost downward.

But when that looked unlikely under the best scenarios, Obamacare proponents pivoted and said the American public would embrace this law. Even former President Bill Clinton recently admitted he was wrong in saying that Democrats would pick up additional support with Obamacare’s passage.

So how much more could the new health law impact Americans and the health sector if other forecasts, such as those from the Congressional Budget Office, turn out to be false? Heritage’s brand-new Obamacare Impact Calculator shows the real-time results of what these changes could mean to you, the federal budget and the US economy if the CBO is wrong. (more…)

Tags: Budget Gimmicks, Congressional Budget Office, health care costs, Obamacare Impact Calculator

Obamacare: The Real Price Tag is a Moving Target

Two new studies highlight the growing concern that the true cost for Obamacare is greater than originally anticipated. Last week, a new report from the Office of the Actuary at the Center for Medicare and Medicaid Services (CMS) revised its estimates—exposing yet again that the new law will mean more health care spending, not less. Plus, the Congressional Research Service released a report that suggests states will face higher costs as a result of Obamacare.

These studies are just two examples of how assumptions, even small ones, in forecast models of Obamacare result in large differences for the total cost of the new law. The CMS study, for example, assumes the scheduled physician payment cuts will continue as planned, resulting in significant savings that will help offset the massive expenses from Obamacare. However, history has shown that these cuts have never gone into effect and aren’t likely to do so in the future. As a matter of fact, the physician cuts for this year already were postponed. The CRS report focuses on the variation in estimates regarding the impact of the new law on the states. (more…)

Tags: Budget Gimmicks, CMS, congressional research service, ObamaCare, true health care costs

Don’t Be Fooled, House Health Care Bill Would Raise Long-Term Deficits

Contrary to several reports, the House Democratic health care bill (H.R. 3200) is not deficit-neutral, but would raise deficits to alarming new levels over the long term. It would do this by relying on several old warhorse budget gimmicks. According to the Congressional Budget Office (CBO), H.R. 3200 would increase the budget deficit by $239 billion over ten years – that’s right, increase. And that’s even before these gimmicks:

1st Gimmick – Fiddle with Implementation Dates: True, the bill runs surpluses initially. Why? Because the tax hikes proposed to pay for the new program would begin in 2011, but the spending would be not start until 2013. This same thing happened with the Medicare drug benefit debate – lawmakers simply delayed implementation by two years in order to reduce the ten-year cost. Of course, this gimmick did not reduce the program’s true cost once fully implemented. So claims of deficit neutrality are hollow.

2nd Gimmick – Ignores Long Term Costs: The President has repeatedly stated that he would not support health care without long-term savings. Yet this legislation – and others – fails to include any formal analysis of its long-term costs. Once the bill’s new healthcare spending is fully implemented, however, it would run expanding budget deficits that reach by $65 billion annually by 2019. Moreover, this initial CBO analysis significantly understates the long term cost. Extrapolating these trends, the bill could run budget deficits of approximately $800 billion total in its second decade, and even much more thereafter. Before lawmakers pass along huge new debts to America’s younger generations, they really ought to know how big they are going to be.

Deficit-neutral? I don’t think so.

Tags: Budget Gimmicks, deficit spending, health care