After a while, you start to see the patterns. You can’t ensure 31 million people for free. According to CBO, under the Reid bill in 2019 the Federal costs for providing subsidies for such insurance is 83 billion dollars in premium and cost sharing subsidies, 24 million dollars in reinsurance and risk adjustment payments, and 87 billion dollars in expanded Medicaid payments. (I like the 2019 snapshot for evaluation because the ramp and different time frames for taxes make the 10 year totals very deceptive.) So, in the 2019 snapshot you get about 194 billion dollars in outlays. For comparison sake, a ten year operating window you have about $2 trillion dollars in new outlays.
For the 2019 snapshot CBO notes offset of 47 billion dollars in reductions in Medicare annual updates to FFS Payment rates, 22 billion dollars in reductions in Medicare Advantage, 10 billion dollars in reductions payments to certain types of hospitals and 21 billion dollars of other Medicare savings. There are also new taxes. Of course savings to Medicare should have gone to Medicare. Medicare is going broke. Why do you take “savings” and use them for a different entitlement. Some costs were in the House bill but simply taken off as a budget trick. This trick is prominently mentioned by CBO:
“For example, the sustainable growth rate (SGR) 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 in the Congress.” CBO is referring to what the House was originally provide as $247 billion in new spending over ten years to address these payments.
CBO certainly does not try to hide its skepticism over the cuts to Medicare spending per beneficiary. They are not really authorized to explicitly say this is a sham. They simply note that Medicare spending per beneficiary would increase substantially less than what history has provided. They know this is unsustainable. The Medicare actuaries, in evaluating the House bill were even more explicit in to pointing to this sham.
Because of the bill’s severe cuts to Medicare, “providers for whom Medicare constitutes a substantive portion of their business could find it difficult to remain profitable and might end their participation in the program (possibly jeopardizing access to care for beneficiaries).”
Because Medicare cuts would likely have to be reduced to avoid jeopardizing access to care for seniors, the provisions “will likely result in significantly smaller actual savings” than assumed. Beyond the Medicare cuts, the other provisions designed to reduce the rate of growth in health care costs would have “a relatively small savings impact.”
Because of the increased demand for health care, “supply constraints might interfere with providing the services desired by the additional 34 million insured persons.” The result could be “some of this demand being unsatisfied,” meaning that people would not have access to care. Additionally, providers would negotiate for higher rates, meaning that health care costs and premiums would increase.
Again these statements of the Medicare actuaries are about the House bill, but it seems like the same issues that are in the Senate bills.
What that means is the obvious — the trillions in new spending are real. The purported savings to offset the new spending are not. Same sham. Apparently, Congressional leaders do not believe Americans are particularly astute about material like this. And public reporting has been fairly weak in explaining the point.