Expect Higher Deficits with Obamacare
In a conference call Monday December 14th with bloggers, the Peterson Foundation unveiled a new study by the Lewin group on the costs of the House & Senate healthcare bills.
The study, sends an ominous message: Under both House and Senate plans, federal healthcare costs will skyrocket. Deficit neutrality is achieved by hypothesizing reductions in Medicare and Medicaid spending. Those predictions however are not very credible. As Susan Tanaka of the Foundation delicately put it:
Maybe all these changes can end up being deficit neutral over the longer term, but it’s also possible, given the complexities of the health care system, that that’s not going to happen.
Politically, it’s much easier to increase benefits than it is to cut spending and to raise new revenues. There are certain pressures within the budget process that tend to drive us away from deficit neutrality. ... We do not see any measures within either bill that would help guarantee that those type of developments, should they occur, will be offset.