So yesterday the CBO announces that the cost of Repealing Health Care Reform would be $230 Billion over ten years - and to this newly minted Speaker Boehner proclaims that he's possess the powers of Professor X.
Well, I do not believe that repealing the job-killing health care law will increase the deficit," Boehner replied. "CBO is entitled to their opinion, but they're locked within constraints of the 1974 Budget Act."
...
"I don't think anybody in this town believes that repealing Obamacare is going to increase the deficit."
Oh, so he has the mutant power to know what everyone else believes, does he? Like wow. Time to take on Magneto and the Brotherhood of Evil now, I guess.
Besides Beohner's Jedi mind-reading tricks we've also had some sweet tweets from our new Budget Committee Chairmain - Paul Ryan.
@RepPaulRyan Setting the record straight on budget-busting health care law: http://bit.ly/...
Ryan was far more specific about what he feels that CBO is wrong with it's projection.
Claim: In his letter to Speaker Boehner, CBO director Elmendorf writes that the Democrats’ new health care law “would reduce budget deficits over the 2010-2019 period and in subsequent years; consequently, we expect that repealing that legislation would increase budget deficits.”
Response: The same budget gimmicks that allowed the Democrats to get a CBO score last spring saying that their massive entitlement expansion would somehow reduce the deficit are still in place today. Nothing has changed about the underlying legislation.
Claims of deficit reduction are still excluding the $115 billion needed to implement the law. The Democrats are still double-counting $521 billion from Social Security payroll taxes, CLASS Act premiums, and Medicare cuts. The score still doesn’t account for the costly “doc-fix” provision that Democrats stripped out of the bill and passed separately.
Ryan is correct to note that the change from $143 Billion in estimated savings from the original forecast only shifted to $230 Billion because this forecast is for a different period - from 2012 to 2021, instead of 2010-2019 - but that both estimates work off the same basic presumptions.
Ryan says that CBO presumptions were "all wrong", to which I say - that's because they actually read the bill unlike Republicans who apparently prefer reading World Net Daily to find out what the law says.
Let me take the last part of Ryan's argument first because if you think about for more than a nano-second - it's truly striking in it's rank ridiculousness. Ryan is criticizing the CBO estimate for not including the cost of the "doc fix" - Because the DOC FIX WASN'T INCLUDED IN THE LAW!
Follow me slowly here -- why exactly should the CBO include the cost of repealing something that's Not Going to be REPEALED by the theoretical implementation of HR2?
Once you've wrapped your mind around that astounding example of illogical sollipism there's also the fact that the CBO did address issues like this in their original report on the final Reconciliation Bill of 2010.
Key Considerations. Those longer-term calculations reflect an assumption that the provisions of the reconciliation proposal and H.R. 3590 are enacted and remain unchanged throughout the next two decades, which is often not the case for major legislation. For example, the sustainable growth rate mechanism governing Medicare’s payments to physicians has frequently been modified (either through legislation or administrative action) to avoid reductions in those payments, and legislation to do so again is currently under consideration by the Congress
They admit that the Doc Fix was in the process of being addressed in another bill - and they logically didn't include it because, that's a different BILL.
Ryan claims that the CBO didn't include "$115 Billion needed to implement the law" but reviewing the report I found this...
CBO expects that the cost to the Internal Revenue Service of
implementing the eligibility determination, documentation, and
verification processes for premium and cost sharing subsidies would
probably be between $5 billion and $10 billion over 10 years.
CBO expects that the costs to the Department of Health and Human
Services (especially the Centers for Medicare and Medicaid
Services) and the Office of Personnel Management of implementing
the changes in Medicare, Medicaid, and the Children’s Health
Insurance Program, as well as certain reforms to the private
insurance market, would probably be at least $5 billion to $10 billion
over 10 years. (The administrative costs of establishing and
operating the exchanges were included as direct spending in CBO’s
estimate for the legislation.)
So basically - Ryan is Lying when he says CBO didn't include the cost of implementing the Bill. They did. He doesn't specify say so, but if you surmise that his "$115 Billion" comes from is the cost of implementing the State-Based High Risk Pools between now and 2014 as well as the Exchanges after that point (Even though CBO specifically said this was included), the problem that remains is any costs that CBO hasn't noted here are costs to the STATES and shouldn't be included in the Federal Deficit!!!. It's the Congressional Budget Office, not the States Budget Office.
The other assumption one could make, because as I said Ryan doesn't specify where this magic money is being spent, is that's he's just plain wrong because Table 4 of the CBO report happens to include $5 Billion for the Costs Federal Subsidies for High-Risk Pools and Exchange Subsidies. Oops!
Even when reading the speakers report on how much "Obamacare Kills Jobs and creates a $701 Billion Deficit" it's still not clear where this "$115 Billion" comes from.
$115 billion in new government spending required to implement the health care law is not factored into CBO’s initial estimate. On May 11, CBO notified Congress that additional discretionary spending would be required to implement the government takeover of health care. This includes roughly $9 billion for both the Internal Revenue Service (IRS) and the Department of Health and Human Services
(HHS).l i
This claims simultaneously that the CBO did not include an estimate for IRS costs - when they actually did include these costs as between $5 and $10 Billion - and that those costs are both $9 Billion and $115 Billion at the same time. (My best guess is that they're trying to say that for six years stretching from 2013-2019, both IRS and HHS will have increased costs of $9 Billion per year, which comes to $108 Billion total, but that still doesn't match their claim of $115 Billion in costs and flies directly in the face of CBO which specifically said that IRS, HHS & OPR combined overhead would be $10-$20 Billion Total for the entire Ten Years!)
Every time you dig into it - their numbers don't work out.
Ryan claims that CBO Double-Counts the benefits of Medicare Savings in the plan - yet I can only find it once - on Table 2 (Page 18) at $455 Billion in Savings over 10 Years. Yet again, this appears to be another LIE, but the Speakers report may shed some light on it.
$398 billion is claimed in Medicare Hospital Insurance Fund savings. CBO has previously noted that “to describe the full amount of HI trust fund savings as both improving the government’s ability to pay future Medicare benefits and financing new spending outside of Medicare would essentially double-count a large share of those savings and thus overstate the improvement in the government’s fiscal
position.”
Ok, I don't see a reference to $398 Billion in savings to the "Medicare Hospital Insurance Fund" (Also Known as Medicare Part-A) in the March 20, 2010 CBO Report at all - so that looks like yet another lie. The report notes a Medicare Fee-for-Service Rate (which includes Parts-A and B) reduction of $193 Billion and a Medicare Advantage (Part C) reduction of $139 Billion. So basically the Republcans are saying CBO claimed $398 Billion in savings for Part-A ALONE but CBO actually say Part A, B, & C savings all together only comes up $332 Billion which still doesn't add up to $398 Billion.
And on top of all that Medicare Trustee Report Says This...
The Medicare Hospital Insurance (HI) Trust Fund is projected to remain solvent until 2029, 12 years longer than reported in 2009 thanks to the Patient Protection and Affordable Care Act, as amended by the Health Care and Education Reconciliation Act of 2010, according to the Medicare Board of Trustees 2010 annual report, which was released today. In addition, the HI long-range actuarial deficit has been reduced to 0.66 percent of taxable payroll, or one-sixth of its projected amount before enactment of the Affordable Care Act. Although HI costs are estimated to continue to exceed trust fund income for the next few years, as they have since 2008, the savings under the new health reform act are expected to result in fund surpluses during 2014-22.
So according to the Trustees Report, the same report that in 1994 sent the Gingrich Congress into a desperate flat-spin tizzy to force a Balanced the Budget by 2002 and consequently Shutdown the Government - TWICE, Medicare - as of now - is headed for a Surplus in 2014 as shown by this chart.
Table II.E1.—Estimated Operations of the HI Trust Fund
under Intermediate Assumptions, Calendar Years 2009-2019
[Dollar amounts in billions] |
Calendar year |
Total income |
Total expenditures |
Change in fund |
Fund at year end |
Ratio of assets to
expenditures |
2009 |
225.4 |
242.5 |
-17.1 |
304.2 |
132 |
2010 |
217.6 |
249.3 |
-31.7 |
272.5 |
122 |
2011 |
241.5 |
259.3 |
-17.8 |
254.7 |
105 |
2012 |
254.4 |
271.2 |
-16.8 |
237.9 |
94 |
2013 |
277.0 |
282.5 |
-5.5 |
232.4 |
84 |
2014 |
297.2 |
296.0 |
1.2 |
233.6 |
79 |
2015 |
315.9 |
305.0 |
10.8 |
244.4 |
77 |
2016 |
336.6 |
321.2 |
15.4 |
259.8 |
76 |
2017 |
357.2 |
338.2 |
19.0 |
278.8 |
77 |
2018 |
377.9 |
357.9 |
20.0 |
298.8 |
78 |
2019 |
397.9 |
379.7 |
18.2 |
317.0 |
79 |
More from the Trustees
The Affordable Care Act has introduced important changes to the
Medicare program that are designed to reduce costs, increase
revenues, expand the scope of benefits, and encourage the
development of new systems of health care delivery that will improve
health outcomes and cost efficiency.
Also, getting back to Ryan again, as a result of the Tax Deal that Obama made with Congressional Republicans last month, Social Security Payroll taxes were REDUCED by 2% so it's no longer a benefit to the deficit, it's now a negative.
Now while Ryan has a field day trying to rip the CBO a brand new orifice with his latest batch of tweets he seemed proud as punch to accept it's conclusions when it review HIS socalled "Roadmap for America".
The Roadmap is my attempt to offer America a choice, an alternative to Progressivism’s dreary path to welfare statism. It shows, using CBO analysis, that it is not too late for America to choose a path true to its founding ideas. We can still be that exceptional nation.
So when the CBO says something that Republicans like Beohner and Ryan dogmatically choose not to believe they say the Congress Official Non-Partisan Budget Umpire is "Entitled to their Opinion", but when they want to bolster the clout of their own ideas they TOUT the fact that it's been analyzed by the CBO?
Hypocrit Much, Mr Ryan?
Of course, while he crows about his plan being CBO scored he ignores what the CBO actually said about his plan.
On Social Security Ryan's plan would both cut benefits and RAISE payroll taxes.
Traditional retirement benefits would be reduced below those scheduled under current law for many workers who are age 55 or younger in 2011.
The Roadmap would also eliminate the income and payroll tax exclusions for
employment-based health insurance. As a result, more earnings would become taxable for Social Security purposes, thus boosting future benefit payments, and payroll tax revenues credited to the Social Security trust funds would increase.
On Medicare the eligibility age would be raised, and the system converted into vouches program which would slash it's effectiveness.
The age of eligibility for Medicare would increase incrementally from 65 (for people born before 1956), as it is under current law, to 69 years and 6 months for people born in 2022 and later. Starting in 2021, new enrollees would no longer receive coverage through the current program but, instead, would be given a voucher with which to purchase private health insurance.
Welcome to the wonderful world of Health Stamps.
And on the Budget?
The Roadmap, in the form that CBO analyzed, would result in less federal spending for Medicare and Medicaid as well as lower tax revenues than projected under CBO’s alternative fiscal scenario (see Table 1). On balance, those changes would reduce federal budget deficits and the federal debt.
So the Ryan plan would cut the deficit, which as a point in fact is already going down, but it would do so by punishing the poor, the sick and the old at a time when 74% of the Public supports raises taxes on the Rich to Balance the Budget.
So much for the "Will of the People"
Contrast that result with both the CBO and the Medicare Trustee Reports which say that "Obamacare" will reduce the deficit, increase the number of people covered and improve quality.
But there is another source that both Boehner and Ryan have depended on, a report from he Independant Centers for Medicare and Medicaid which the Heritage Foundation Characterized this way.
Obamacare will bend the cost curve up, causeing an additional $289 billion in expenditure
Millions will lose their existing private coverage
18 million Americans will either face jail time or be forced to pay a new tax they will receive no benefit from.
8.5 million seniours who currently get such services as coordinated care for chronic conditions, routine eye and hearing examinations, and preventive-care services would lose their existing private coverage.
More than half the people who gain health insurance will receive it through the welfare program Medicaid.
Hospitals currently serving Medicare patients might be forced to stop doing so, thus making it much more difficult for seniors to get health care.
Supply constraints will mean that the 21 million people who are gaining health insurance through Medicaid are going to have a very tough time finding a doctor who will treat them.
Yet, Surprise surprise - the actual CMS Report says nothing of the kind.
By 2019, the mandates, along with the Medicaid expansion would reduce the number of uninsured from an estimated 57 Million - to 23 Million.
Another 10 Million people would gain insurance through the newly created Exchange. Finally, we estimate the number of persons with employer-based insurance would increase by 2.9 Million.
CMS estimated that the total Cost of the Bill (which actually was the House Version of the Bill which was voted out in November of 2009 and Included The PUBLIC OPTION, not the final Bill that passed both the house and Senate) was $406 Billion over 10 years, including $900 Billion in outlays and over $571 Billion in Medicare Savings. They also estimated that the Costs for Plans Offered through the Public Option would be 5% lower than private plans, but that their premiums would be 4% Higher because of the "anti-selection by enrollees" - so that gives you an insight as to how their thinking seems to work.
There are a lot of differences between the CBO and CMS report but the most obvious thing that jumps out to me is their differing assumptions on the amount of subsidies and affordability credits available via the Exchange. CBO estimates that these credits will cost just $107 Billion over the course of 10 years, where the CMS assumes it would cost as much as $591 Billion - a difference that is as great as their final -$148 Billion to +$400 Billion contrasting estimates on the impact to the deficit. (As Jamie Henneman might say - "Well, there's your problem") Exactly who is more correct is debatable at this point since it all depends on how many people choose to join the Exchange (CBO estimates 24 Million in Exchange by 2019, where CMS estimates only 10 Million), how many of them will need and qualify for subsidies and which direction the health insurance cost curve bends. It's fair to say either of their estimates could be correct, and they both could be wrong - but we won't really know until 2019. Still all of these reports say that the cost of Medicare and healthcare in general will be reduced. The CMS report simply doesn't agree the savings will be as great as either CBO or the Medicare Trustees, but it doesn't argue that there won't be savings.
For Fiscal Years 2010 through 2019, we estimate a relatively small reduction in non-Medicare Federal health care expenditures of $2.1 billion, all of which is associated with the comparative effectiveness research provision.
I'm not an Actuarial, but it seems to me one way to resolve this conflict is to look at the base assumptions and do some straight forward math to see if they pan out. If CMS is correct then about 10 Million people will join the exchanges while the basic cost of health care will stay about the same or go down slightly. Right now the median cost of individual market health care is about $7,000, so 10 Million times $7,000 gets you $70 Billion per year. If your counting from the time the Exchanges start in 2014 to 2019, that's 5 times $70 Billion for a result of $350 Billion.
This means you can get $350 Billion only if ALL 10 Million people join the exchange in the FIRST YEAR (2014) and all of them need an almost 100% subsidy for the next five years. Even with all that it's still just barely over 60% of the $591 Billion the CMS claims subsidies are going to cost. As a result I'm thinking CBO's $104 Billion Estimate might be a tad more accurate even if they do base it on a guess of 24 Million people in the Exchanges.
(Ed. Re-checking the CMS Tables, my back of a napkin calculations aren't that far different from their results. They assume 6 years of subsidies starting 2013 starting at $49 Billion, ramping up to $70 for FY2014-2015, and slowly rising from $80 Billion to $100 Billion by 2019. I don't see how 10 Million people cost $100 Billion unless each and every one of the require subsidies in the range of $10,000 per year!!)
Also CBO in it's estimates also includes excise taxes on high-premium plans ($32 Billion), reinsurance and risk assessment collections ($106 Billion) that the CMS report doesn't include because it's focus is only on the outlays and savings associated primarily with Medicare and Medicaid not Taxes that will be collected and also the fact that it's based on an earlier House version of the Bill, not the final version that passed and was signed by the President.
However you parse the disagreement here between CBO and CMS (or the Medicare Trustee's Report) it's clear that NONE OF THEM support frankly ridiculous claims coming from Republicans and the Heritage Foundation over Health Care. None. Zero. Zilch.
The only thing left in the Republican arsenal is the view that requiring business with more than 50 employees to provide their employees Health Care will force those business to refuse to hire people even though those companies will receive tax breaks of up to $5000 per employee for doing so, and small companies (less than 25 employees) receive a 35% tax credit for health insurance costs. Large Employer like McDonalds have balked at the requirement to provide insurance for their employees arguing that they would instead have to not hire or drop coverage - in response the Obama Administration has offered them a waiver from the requirement because alternatives such as the Exchange are not yet available.
While these companies cry and whine about being required to provide decent health care for their employees in 4 years - Cities such as San Francisco who already have an employer mandate have found it isn't much of a problem.
But according to the new report co-authored by Dube, 61% of San Francisco restaurants are very or somewhat supportive of the mandate. This may be because restaurants in the city have found a way to pay for their increased benefit costs without absorbing the expense: many have added a 3% to 4% health care surcharge to customers' bills. In addition, at the same time that the mandate was passed, a de facto public option was implemented. Employers that opt not to provide coverage must pay $1.23 to $1.85 per hour per worker to help fund the public plan. This public option, which only covers care from some doctors and facilities in the city of San Francisco, has proven popular with employers, with 21% using it for workers. Already the San Francisco public option has enrolled a majority of the city's previously uninsured residents, more than 50,000 people. And according to a survey conducted by the nonpartisan, nonprofit Kaiser Family Foundation, 94% of those participating in the program are satisfied with the results.
Rather than "killing jobs" most employers will simply pass these fairly modest costs on to customers, especially if it appears that it may have an impact on their bottom line, and since this impact will be on all companies at the same time there won't be any competitive advantages granted to companies who cut or forego healthcare the way there is now for employers like Walmart.
Just like Death Panels, Birtherism, 16th Amendment Deniers who think the Federal Government doesn't have the authority to collect Income Taxes (a Tea Bagger argument I recently encountered on Twitter) which would make the Mandate Tax Penalty "Unconstitutional", or the claim that Obama spent $200 Million in his trip to India these assertions that "Obamacare Kills Jobs" are simply made-up bullcrap nutbag LIES.
All of them.
Today the House Republicans will force a vote on their Healhcare Repeal - which would reverse every provision of the PPACA and Reconcilition Act - without a Single Hearing, without a Debate and without any Amendments and Increasing the Deficit going Directly Against Everyone of their own Pledge for "Openness" in this Congress (Against which the President has just announced a Veto Threat - In Writing). And it only took one day for them to show what they really care about - continuing to let Americans die in order to support the corporate bottom line.
Vyan
Final Update For those who are night-owls and didn't catch onto this diary until late night after the rescue. Today the Center for American Progress has confirmed what many of us all expected - During a single year, 2010 under Obama more jobs were created than during George W. Bush's Entire 8 Year Presidency
This morning, the Labor Department released its employment data for December, showing that the U.S. economy ended the year by adding 113,000 private sector jobs, knocking the unemployment rate down sharply from 9.8 percent to 9.4 percent — its lowest rate since July 2009. The “surprising drop — which was far better than the modest step-down economists had forecast — was the steepest one-month fall since 1998.” October and November’s jobs numbers were also revised upward by almost 80,000 each.
Indeed, from February 2001, Bush’s first full month in office, through January 2009, his last, the economy added just 1 million jobs. By contrast, in 2010 alone, the economy added at least 1.1 million jobs.