In actuality it doesn't really matter, the CBO develops its costs based on the parameters they are given, which in the case of Obamacare has skewed the costs to give an unrealistic perspective on its effect on the nation's economy. Or as computer software developers would call it, Garbage-in, Garbage-out.
Much of what we have been told by the President and his staff about the cost of his Obamacare program has been at the very least inaccurate, more likely, an outright lie. Here are some of his most egregious examples:
- A new entitlement can "save" money. That was the main thrust of a recent Washington Post op-ed by White House aides Peter Orszag and Nancy-Ann DeParle. The plan "more than meets the president's commitments that health-insurance reform not add a dime to the deficit," they write.
It's true that the Congressional Budget Office estimates that the Senate version of ObamaCare would reduce the deficit by $118 billion over 10 years. But even that number was concocted by budget gimmicks, such as using 10 years of new taxes to fund six years of benefits, as Wisconsin Republican Paul Ryan showed at the White House health summit. Mr. Orszag says this doesn't matter because CBO says the bill will save some $1 trillion in the second decade too.
In fact, CBO is careful to stress that it doesn't really know "because the uncertainties involved are simply too great" over such a long time period. CBO also says that the new entitlement will grow by 8% a year, even as Medicare and Medicaid grow by similar magnitudes and overall federal spending is already at 25% of GDP. If this new entitlement actually "saves" money, it will be the first in history.
- Insurance premiums will fall. Dan Pfeiffer, Mr. Obama's communications director, took to the White House blog to claim that the plan "will make insurance more affordable by providing the largest middle class tax cut for health care." So subsidies are really tax cuts?
Insurance subsidies are transfer payments in which government takes money out of the private economy and gives it to someone else. Subsidies thus put an even larger share of health-care spending in government hands. When you subsidize something, you get more of it, which means higher demand for insurance and health-care services. Combine this with new mandates that have raised costs in every state where they have been tried, and you will get higher premiums.
In Massachusetts—where Mitt Romney imposed the beta version of ObamaCare in 2006 in the nae of controlling costs—insurance carriers asked regulators this week to approve premium increases ranging from 8% to 32% for small businesses and individuals. That isn't far from the top 39% increase by Anthem Blue Cross in California that Mr. Obama claims his plan would prevent.
- The Cadillac tax. This is the 40% excise tax on high-cost insurance plans that the White House proposed because it lacked the political will to directly reduce the $250 billion annual tax subsidy for employer-based insurance. But then the White House scaled back even this effort, delaying its start until 2018 because of union opposition.
Not to worry, says Mr. Orszag, the tax would still create a "gradually increasing incentive to seek higher-quality and lower-cost health plans." In other words, some future Congress will impose the pain Democrats refuse to impose today.Never ever believe a politician who says "Trust Me"
Mr. Orszag also says these future politicians won't block the tax because this "would violate the statutory pay-go law just enacted." He's referring to the same "pay-go" rule that Congress has violated to the tune of $800 billion or so just in the last year.
- Pilot programs. Mr. Orszag and Ms. DeParle also boast about the bill's micro-initiatives and Medicare demonstration projects. They write that "even if we thought we had the answer for containing costs and improving quality today, that would quickly change as health care evolved."
It sounds reasonable. Yet they're forced into this vague hope because their other ideas have either been killed by Congress or because CBO says they won't save money.
About the "Hospital Value-Based Purchasing Program," CBO says it will cut spending by $0 over 10 years.
The "National Pilot Program on Payment Bundling"? Also $0.
- The Medicare commission. This is the real secret of Mr. Orszag's cost-control confidence, and Harvard economist David Cutler wrote in our pages this week that this "independent board" of sages will have the power to recommend spending cuts and create "a process for fast-tracking such recommendations through Congress." We'll believe that when we see it, given how Congress has long overruled specific Medicare spending cuts.
But let's say Congress does cede power to this unelected group of wise men. The commission will then function much like similar bodies do in Europe—controlling costs by denying coverage for new technologies or patients at the end of life, or by limiting spending on certain treatments and thus creating longer waits. Governor Deval Patrick has already announced the early stages of such a price-control regime in Massachusetts.
ObamaCare's real cost-control plan boils down to this: First subsidize coverage so much that costs explode, raise taxes as much as possible to pay for it, and when that isn't enough hand power to an unelected committee to limit treatment and control prices by government order. This is what Democrats are voting for.Below is a story from the UK Mail, read it carefully because this is the future of the US under Obamacare, Britain's rationing body rejected ten different pharmaceutical drugs used elsewhere in Europe. This move could lead to the premature death of 20 thousand cancer patients a year.
Up to 20,000 people have died needlessly early after being denied cancer drugs on the NHS, it was revealed yesterday.The rationing body NICE has failed to keep a promise to make more life-extending drugs available.
Treatments used widely in the U.S. and Europe have been rejected on grounds of cost-effectiveness, yet patients and their loved ones have seen the NHS waste astronomical sums.
Last week it emerged that £21billion - a fifth of the entire annual budget - was spent on failed schemes to tackle inequality.
NICE, the National Institute of health and Clinical Excellence, promised a year ago to make it easier for drugs for rarer cancers to be approved.
But since then four drugs which could have benefited 16,000 people have been turned down outright and a further six which could have helped 4,000 more have been provisionally rejected.
Just five drugs have been accepted - benefiting 8,500 people - says a damning report by the Rarer Cancers Forum. Drugs for rarer forms of cancer are often much more expensive than those for common tumours because pharmaceutical companies cannot make economies of scale.
NICE's promise to approve more drugs was in response to widespread anger over its rejection of sunitinib, also known as Sutent, for advanced kidney cancer - even though it had been proved to double the life expectancy of patients compared to standard treatments.
Andrew Wilson, chief executive of the Rarer Cancers Forum, said: 'Although progress has been made, there is still more to do.
'It is unacceptable that thousands of patients are still missing out on the treatment they need, and their doctors want to give them, because NICE has decided that their treatment does not meet some arbitrary criteria.
'The changes introduced by NICE should be benefiting more patients than they are. An urgent review of NICE's processes is needed.'
The RCF also says NICE works so slowly that it takes 21 months to decide on a drug, during which time many patients die. This is despite promises from NICE bosses to get the decision time down to six months by the end of this year.
Mike Hobday, head of campaigns at Macmillan Cancer Support, said: 'The system is failing people with rarer cancers. It's time for a more flexible approach.'
NICE's treatment of rarer cancer drugs contrasts sharply with its breast cancer drug herceptin, which has received far more funding following successful campaigns.
If a patient is refused a drug, they are allowed in many cases to appeal to their primary care trust.
But the RCF report uncovered a huge postcode lottery, with some trusts much more likely to back down on appeal. Of 62 PCTs, 11 approved all drugs and two approved none.
And while 26 per cent of English patients have their 'exceptional case' requests rejected, the figure in Scotland is just 11 per cent.
The RCF says appeals are so expensive in terms of staff time that it would be cheaper just to give everyone the drugs they want.
Its report also warns: 'PCTs are frequently using inappropriate processes to determine funding applications and a small minority of commissioners may be breaking the law by operating a blanket ban on the funding of treatments outside their licensed indication.'
In Bromley, for example, cancer treatments were less likely to be funded than cosmetic procedures. Another difference between PCTs is that some reimburse the cost of any private treatment but others do not.
Wow, easier to get cosmetic treatments than cancer treatments? At least Nancy Pelosi and the SCHMOTUS will be happy.
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