A few days ago, Democrats in Congress were praising the healthcare reform bill as a deficit-reducting necessity. This was based on a preliminary report from the Congressional Budget Office (CBO). There are always a few things to keep in mind when evaluating a CBO report. The CBO is politically neutral--they are neither Democrat nor Republican, but their estimates are based on the figures and parameters that they are given. If they are told that the government is going to collect $100 in taxes and spend $80, they will see a $20 savings in a bill. Again, their figures are based totally on what they are told.
Earlier this year, the heathcare reform bill included something known as the 'Doc fix'. This has to do with adjusting the amount of money Medicare pays to doctors for the services they provide. The 'Doc fix' was taken out of the healthcare reform bill in order to make it appear that the bill would be cost-cutting measure. The only problem is that the 'Doc fix' is needed to insure that doctors will continue taking Medicare patients and will continue treating current Medicare patients. The 'Doc fix' will be (if it hasn't already) passed under separate cover.
Yesterday, Yahoo News posted an Associated Press story which confirmed the obvious. The 'Doc fix' or Medicare fix (as it is called in the article) would cause the healthcare reform bill to be $59 billion in the red.
The thing to remember when estimating the cost of the current healthcare reform legislation is that the increased taxes start immediately; most of the benefits do not start until about four years into the program. Therefore, in order to appear to be a cost-saving bill, you have to compare six years of expenses with four years of taxes. What happens when you have to compare ten years of spending with ten years of taxes? The bill becomes an expense, no a cost-saver.
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