CBO Director: Potential Health Law Savings Not Enough To Reduce Long-Term Deficits
Congressional Budget Office findings that for the first time take into consideration "the new health care law, heralded by President Obama and Democrats for reducing deficits in the long run" were presented today before the president's bipartisan fiscal commission. Among the CBO conclusions is that savings that result from the overhaul "aren't enough to turn deficits around." It also questions whether Congress will stick to the tough aspects of the law that would brighten the fiscal picture." In testimony before the fiscal commission, Congressional Budget Office Director Douglas Elmendorf pointed out that savings expected from the new health care law won't be large enough to reduce deficits in the long-term, USA Today's The Oval reports. Elmendorf told the commission "that health care costs remain the primary problem. The health care law passed earlier this year, he said, 'made a dent in the problem but did not substantially diminish that challenge'" (Wolf, 6/30).
Reuters: "Federal healthcare spending and the Social Security retirement program will gobble up a greater portion of the budget and push the national debt up sharply unless lawmakers act, the non-partisan Congressional Budget Office said" (Smith, 6/30).
CNNMoney.com: "If all the health law measures are implemented, we end up with slightly lower federal health spending by the end of the 2020s," Elmendorf said. "Specifically, Elmendorf noted that spending on major mandatory health care programs such as Medicare is on track to double by 2035, up to 10% of GDP from 5% today. That increase is the equivalent of $700 billion this year in additional spending, Elmendorf said. ... The only way to bring the federal budget into better balance would be to sharply reduce U.S. spending, drastically increase taxes to rates never before seen in the United States or some less dramatic combination of the two, Elmendorf said. The challenges are great, and the longer policymakers wait to stabilize the debt, the harder their task, Elmendorf said" (Sahadi, 6/30).This is part of the KHN Morning Briefing, a summary of health policy coverage from major news organizations. Sign up for an email subscription.