PPACA cost estimates jump another $111 billion in Obama’s latest budget
What’s a few hundred billion when it’s tax payers’ money? My last blog entry highlighted the death of the Obama administration’s long-term care provision, the CLASS Act, which had been tasked with generating $80 billion for Obamacare, a naive pipe dream from the beginning. Now, buried deep within Obama’s newly released budget, is a line item for subsidized exchange care at $478 billion, up from last year’s budget estimate of $367 billion for the period 2014 – 2021.
House Ways and Means Chairman David Camp demanded an immediate explanation why this subsidy provision estimate has jumped by 30% in one year. At a congressional hearing last week, HHS Secretary Sebelius stated she was unaware of any changes.
The administration is now claiming that the changes are technical in nature and are tied to savings in Medicaid, and do not reflect increased assumptions in the number of Americans expected to seek subsidized care. Republicans are not buying the technical corrections argument and point out that the administrations projections differ from the revised CBO’s cost projections.
Camp, in a letter to Treasury Secretary Geithner, demanded a deeper explanation and noted that the increase ” cannot be explained by legislative changes or new economic assumptions”.
Since January, we have now seen close to a $200 billion revenue swing in the trillion-dollar Obamacare assumptions. Given that this administration used a procedural slight of hand called reconciliation to pass this bill, and that reconciliation can only be used in cases where it will result in a deficit reduction, where is the outrage? The cost assumptions will continue to mount, as exchanges are rolled out and states struggle to take over the financial burden.
I would still argue that there are several pieces of this legislation that were necessary and should have passed to protect all Americans, but the President’s position that this bill would pay for itself is laughable.
About the Author
Christopher Nadeau is a Principal at William Gallagher Associates (WGA) and head of the Employee Benefits Group. Mr. Nadeau counsels his department to develop and redesign employee benefits programs to match the corporate philosophy, long-term needs and objectives of their clients. He is also an industry leader on Healthcare reform and the cost impact and administrative burden on employers.