Claims that the health reform law relies on budgetary gimmicks to reduce deficits are false.
Claim: The law uses a gimmick to make it appear fiscally responsible: its biggest spending increases don’t take effect for four years, so CBO’s cost estimate for the first decade (2010-2019) includes ten years of revenue increases but only six years of significant spending. The unstated implication of this charge is that in subsequent decades, when ten years of revenue increases are accompanied by ten years of spending increases, the law will greatly increase deficits.
Fact: There is no gimmick here, and this charge is groundless. CBO estimates that the law will reduce deficits not only over the 2010-2019 decade, but in the second decade and subsequent decades. In fact, the law will reduce deficits by more in subsequent decades than in the first decade, because its most important cost-saving measures are phased in and produce larger savings over time.
Claim: CBO’s cost estimate double-counts the Medicare savings and additional Social Security payroll tax collections that the law will generate, because these savings and revenues could not both help pay for health reform and improve Medicare’s and Social Security’s finances.
Fact: This, too, is a canard. In estimating the law’s impact on the deficit, CBO counted the Medicare savings and Social Security revenues only once. The financial status of the Medicare or Social Security trust funds is a different matter, distinct from CBO’s estimate of the impact of the legislation on the budget deficit. The skilled CBO experts did not double count, as anyone familiar with budget estimates knows.
Claim: CBO’s cost estimate is misleading because it doesn’t include $115 billion in additional discretionary spending that Congress must provide to implement health reform.
Fact: The health reform law contains authorizations for a variety of grant and other programs, and CBO has estimated that if future Congresses chose to fully fund these authorizations — which Congress is under no requirement to do — the total expenditures involved would amount to $115 billion over ten years. But the large bulk of this amount is neither required nor necessary to implement the health reform law, and much of it doesn’t even reflect new expenditures. As CBO has stated, more than $86 billion is “for activities that were already being carried out under prior law or that were previously authorized.” CBO has noted that the law’s actual implementation costs — that is, the cost that federal agencies will incur to administer the law — will be roughly $10-20 billion over the first decade.
Claim: CBO’s cost estimate inappropriately includes savings from the new CLASS long-term care insurance program.
Fact: Congressional leaders deliberately crafted the health reform bill so that it would be fully paid for without relying on savings from CLASS Act premiums. The CBO estimate clearly shows that if one excludes the net revenues of $70 billion from CLASS Act premiums, health reform still reduces the deficit by $73 billion over the first ten years.
Claim: CBO’s cost estimate for health reform is misleading because it doesn’t include the cost of the “doctor fix,” or fixing the sustainable growth rate (SGR) payment formula for physicians.
Fact: The cost of fixing the SGR formula is entirely unrelated to health reform, as can easily be proved — all of the cost of fixing the SGR formula would remain if health reform were repealed. None of that cost can be attributed to health reform.
There's much more there, and it's worth the full read.
There's a lot to critcize in the PPACA; I've never said it was perfect. But it's simply false to claim that it's not paid for or that it will increase the deficit. When the congressional GOP claims that "it's money we don't have," that's false: the Democrats found the money and the bill is paid for, unlike the republican-authored, deficit-financed Medicare Part D. Even if you permit a rhetorical sleight of hand, interpreting Cantor as meaning the health care reform bill was too expensive, that begs the question of why the GOP so vitriolically opposed the medicare "cuts" and other cost-saving proposals such as the public option as "death panels." It's either incoherent or hypocritical to simultaneously criticize the reform as both too expensive as well as too draconian in cutting costs (or restraining the growth in future costs).