Those 'Health Care Gimmicks' Are Still Out There
Today, the Peter G. Peterson Foundation released a Lewin Group analysis of the current House health care reform bill (America’s Affordable Health Choices Act of 2009). Unlike CBO, Lewin's analysis looks at a 20-year period. And while they find the bill to be nearly deficit neutral in the first decade, they expect it to increase the deficit by over $1 trillion between 2019 and 2029.
They also find economy-wide health care spending would increase by $2 trillion over the next two decades, while the number of uninsured would drop by nearly 30 million people.
|Change in Total Federal Spending||530||1,877||2,407|
|Change in Total Federal Revenue||491||868||1,359|
|Change Impact on Federal Deficit||39||1,010||1,048|
A bill can be structured to appear deficit-neutral in the first ten years while leading to large budget deficits thereafter...[A] ‘final year test’ would deter the use of phase-in gimmicks since the phase-in of any costs would have to be accompanied by an increase in the size of offsets...The final year test is not sufficient, however, to prevent new health care spending from exceeding offsets beyond the ten-year period...Even if costs are aligned with offsets in the tenth year, they could easily diverge beyond this period.