Broken Health-Reform Promises?

Health reform will finally reduce the costs of health care.-- President Barack Obama, December 2009. 

"My proposal would bring down cost of healthcare for millions families, businesses, and federal government." --President Barack Obama, March 2010 

Can U.S. taxpayers afford the health reform bill, which the Congressional Budget Office estimates will cost $938 billion over 10 years?

I yield the floor to the Director of Business News at FOX Business, Ray Hennessey:

It is looking more likely that we cannot afford the massive health-care costs that are coming down the pike under last year's health-reform law. Including government and private money, health-care spending in 2020 will average $4.6 trillion, or $13,710 for every American, according to Medicare's Office of the Actuary.

That's $1 for every $5 in the economy. By comparison, U.S. health-care spending this year is projected to top $2.7 trillion, or about $8,650 per capita, roughly $1 of $6 in the economy. The government - that means us, the taxpayers - will foot half that bill. Health-care spending will jump by 8% in 2014, when the new law's coverage expansion kicks in.

Given that we can't pay our bills today, can we afford such big bills in the future? The massive health-care law that promised to cut costs and save our federal budget will do no such thing. Thats not opinion. Thats the assessment from the government itself.

The Centers for Medicare and Medicaid Services just gave a 10-year forecast of health spending in this country and reckons that health spending will grow by 5.8% over the next decade. Sans the law, spending growth would have been 5.7%. Granted, thats not a huge rise in costs that some opponents of the law predicted. But the administration and Congress insisted last year that only a massive overhaul of the health-care law would prevent costs from skyrocketing. As the numbers show, that was patently untrue."

So, what does the White House say about the new CMS report?

As for the CMS finding that average annual growth in national health spending is expected to be 0.1 percentage point higher even with health reform, the White House says: Simultaneously, by 2020, thirty million Americans are expected to gain health insurance coverage as a result of the Affordable Care Act.

However, where will those thirty million uninsured end up?

As weve reported to you, health reform will add an estimated 16 million new enrollees, mostly uninsured adults, into the Medicaid system by 2019, on top of the estimated 49 million already enrolled, according to a report based on information from the nation's governors that was issued by the House Committee on Energy and Commerce and Senate Finance Committee on May 3.

That means the number covered by Medicaid will grow by a third, the report said. Over the next ten years, the federal government will spend $4.6 trillion on Medicaid -- a substantial contributor to the growing $14 trillion national debt, says the report. At the state level, Medicaid spending now consumes nearly a quarter of state government budgets -- a significant driver of state budget crises.

At the same time, another 16 million people are expected to pour into the new, state-based health insurance exchanges. The government will provide subsidies for them up to 400% of the federal poverty level.

So that covers the roughly 32 million uninsured people.

Meanwhile, the U.S. faces a severe doctor shortage. The AAMC Center for Workforce Studies projects a shortage of 91,500 physicians by 2020.

However, the White House says the new CMS report doesnt tell the whole story. [The] Affordable Care Act creates changes to the health care system that typically dont show up on an accounting table. We know these new provisions will save money for the health care system, even if todays report doesnt credit these strategies with reducing costs.

The White House cites new private-public health partnerships on on preventative care, voluntary Accountable Care Organizations that seeks to coordinate care for an individual patient across care settings including doctors offices, hospitals, and long-term care facilities, hopefully creating as much as $960 million in Medicare savings over three years.