CBO: Obamacare to cost $1.76 Trillion over 10 years

Rhapsody1447 · Mar 16, 2012

Re: New CBO health law estimate shows much higher spending past first 10 years

Kandahar said:
The failings of that prediction have less to do with an overestimation of economic growth (although that was part of it), and more to do with not predicting what future Congresses would do. In January 2001 the CBO didn't include the deficit-exploding changes of the Bush tax cuts, 9/11, the Afghanistan War, the Iraq War, cleaning up Hurricane Katrina, annual Medicare doc fixes, economic stimuli, TARP, or plenty of other things. And I would argue that it was perfectly reasonable NOT to include those things, since the CBO had no idea that they were going to happen. The CBO's $5.6 trillion surplus projection was based solely on the policies that were already in place when they made that prediction in January 2001; $5.6 trillion would have been an overestimate anyway, but not nearly as much. It isn't fair to blame the CBO for not predicting the behavior of future Congresses.

The report also assumes an average annual real GDP growth rate of 3.1%. The next year we were in a recession. Regardless, that's the whole point. We have no way of projecting the potential policy changes, economic shocks, geopolitical events, natural catastrophes, and the million other exogenous factors that contribute to these projections. However, we can project future budgetary expenses much more accurately. You're free to look at my other post regarding Obama's budget revenue projections as well. Note the difference in spending vs. revenues deltas.

No, this is not correct. At the time the Affordable Care Act was passed, the CBO actually issued projections for the first ten years and the second ten years. Every year in the current projection (2012-2022) had an estimate at the time the law was passed...which were generally pretty similar to the current estimates. There wasn't any waiting involved to the discover the 10-year cost. The CBO just prefers to break its predictions up into 10-year chunks, but they predicted more years into the future than that.

If you have the report, please link it. As shown in my first post in this thread the March 2010 CBO report sent to Pelosi used 2010-2019 projections to estimate $940 billion in gross costs. I'm assuming that's the figure the President was referring to in his speech. If you have a different report, it would do nothing to dispute the underlying point. Either Obama is referring to only 6 years of actual costs or the projected cost doubled. Your last post seems to contradict your first.

Sparkles · Mar 16, 2012

Re: New CBO health law estimate shows much higher spending past first 10 years

Guys, the problem is real simple. The medicare offsets were based on several fundamentally flawed theories.

One: That people would get private insurance and thus not need Medicare. Problem is ruining the economy doesn't make people get private insurance no matter what the incentives or penalties are. Compounding that, is that more taxes hurt the private sector, which drives more people onto Medicare.

Two: That Obama's great Keynesian Stimulus would cause a massive boost in the economy (even though it has failed every time it was tried in the past). This plan undoubtedly failed by any reasonable measure, and thus the Medicare tax revenues are not there.

Three: Obama care mandated that states drastically increase medicare and medicaid spending, to covertly cost-shift Medicare onto the states. Instead States have been slashing medicare and medicaid, shifting the burden back on the Federal government.

Four: They have cut doctor payouts. Which had the unintended consequence of causing doctors to refuse Medicare patients. These patients are forced to go to hospitals to get care, because doctors will not see them. The resulting hospital stay is vastly more expensive than the doctor visit is.

Five: Preventative care is in theory going to reduce cost, when in reality, it increases cost.

Now these are just the top 5 reasons. There are more. But the point is, the government's claimed offsets are simply not effective. I predicted in 2009 when Obama care was passed, that it would cost at least double what they claimed, because of these flawed supposed offsets.

Rhapsody1447 · Mar 16, 2012

Re: New CBO health law estimate shows much higher spending past first 10 years

I just randomly came across this and the coincidence merited sharing. I realize it doesn't contribute a lot to the debate but it shares the inherent skepticism of CBO analysis:

Congress's Number Cruncher Comes Under Fire - WSJ.com

This is unrelated to health care but the full disclosure of the whistleblower:

Terminated CBO Whistleblower Shares Her Full Story With Zero Hedge, Exposes Deep Conflicts At "Impartial" Budget Office | ZeroHedge
http://www.zerohedge.com/sites/defa...imageroot/2012/02/Pham Response Mar7 2012.pdf

Sparkles · Mar 16, 2012

Re: New CBO health law estimate shows much higher spending past first 10 years

Rhapsody1447 said:
I just randomly came across this and the coincidence merited sharing. I realize it doesn't contribute a lot to the debate but it shares the inherent skepticism of CBO analysis:

Congress's Number Cruncher Comes Under Fire - WSJ.com

This is unrelated to health care but the full disclosure of the whistleblower:

Terminated CBO Whistleblower Shares Her Full Story With Zero Hedge, Exposes Deep Conflicts At "Impartial" Budget Office | ZeroHedge
http://www.zerohedge.com/sites/defa...imageroot/2012/02/Pham Response Mar7 2012.pdf

All future budget predictions rely on fundamental assumptions. This is true in our private lives as well. When you plan out your next vacation, you makes some fundamental assumptions. Like that your house won't burn down before vacation. That none of your family will get sick, or have some other emergency. That there will not be a hurricane at your vacation location. That you won't lose your job.

The government has to make assumptions, and every single assumption can be used as a political tool to attack opponents with.

This claim that the CBO is a front for Wall Street is contradicted in it's own findings.

alleges supervisors stifled opinions that contradicted economic fixes endorsed by some on Wall Street, including research from a Morgan Stanley economist who served as a CBO adviser.

Notice, the economist was from Morgan Stanley, and had research that opposed the economic fixes endorsed by Wall Street.

Notice also, the economic fixes were only endorsed by *SOME* on Wall Street.

If the CBO was a 'front for Wall Street' as this article claims, the economist from Morgan Stanley would never oppose the Wall Street consensus. And at least there would in fact be a Wall Street consensus.

The fact that only *SOME* people on Wall Street endorsed the economic fixes, is about as relevant as *SOME* doctors support Obamacare, and *SOME* high school teachers support the stimulus. Big deal, *SOME* of every group support various positions on various issues.

It's like saying 40% of all sick days are on Monday and Friday.

Thanks for posting your link. It was an nice read, but there's no real evidence for the claim.

jonny5 · Mar 16, 2012

xpiher said:
Congress care didn't reform the health care system, it simply transferred cost with a few good previsions. Real health care reform would start with the overhaul our abolishment of insurance companies.

In his example you aren't paying for it which was my point

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You are failing to make your point because you wont elaborate.

xpiher · Mar 16, 2012

jonny5 said:
You are failing to make your point because you wont elaborate.

That's because the only access to the net I have at this time is on my phone. Anyways, the basic premise is that health insurance unintentionally drives up prices because no onebegin huntswhile at the same time screwing people over by refusing to cover various treatments

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Sparkles · Mar 16, 2012

xpiher said:
That's because the only access to the net I have at this time is on my phone. Anyways, the basic premise is that health insurance unintentionally drives up prices because no onebegin huntswhile at the same time screwing people over by refusing to cover various treatments

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Which explains why insurance companies operating in states with lax regulations of insurance, have very low premiums, while states with very tight regulations on insurance, have very high premiums.

Now why would an insurance company not drive up prices in low regulation states?

Why would insurance companies drastically drive up prices in high regulation states?

Answer: In states with low regulations, many insurance companies can compete with each other over many varying policies. This competition drives down the price.

In state with very high regulations, where each policy is a cookie cutter from the government imposed regulation, there's no way to compete. Further, with every expensive service mandated to be covered, the price is pushed up higher and higher.

xpiher · Mar 16, 2012

I don't care about the price if insurance. I care about the cost of care

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Sparkles · Mar 16, 2012

xpiher said:
I don't care about the price if insurance. I care about the cost of care

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Insurance doesn't drive up the cost of care.

The cost of care is simply the result of having good care.

xpiher · Mar 16, 2012

Sparkles said:
Insurance doesn't drive up the cost of care.

The cost of care is simply the result of having good care.

Then you need to do some more research. Start with hmos

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Sparkles · Mar 16, 2012

xpiher said:
Then you need to do some more research. Start with hmos

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Yeah, HMOs that were created by....? The government created HMOs. Most people don't know that.

So here you cite a government created problem, and claim government is the solution? Err... no.

xpiher · Mar 16, 2012

Sparkles said:
Yeah, HMOs that were created by....? The government created HMOs. Most people don't know that.

So here you cite a government created problem, and claim government is the solution? Err... no.

Never said the gov was the answer for how to run the programs. Saying that a program can't kick you off when you get sick because the system is broken is a justfiable intervention. It will take government action to fix the system because of how broken the system is due to monopolies, slanted rules, the fact employers pay directly for health care and demand personal involvement, etc

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Sparkles · Mar 17, 2012

xpiher said:
Never said the gov was the answer for how to run the programs. Saying that a program can't kick you off when you get sick because the system is broken is a justfiable intervention. It will take government action to fix the system because of how broken the system is due to monopolies, slanted rules, the fact employers pay directly for health care and demand personal involvement, etc

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And every country that has plunged into a socialist 3rd world ruins, has always used the exact same justification for their own destruction. Only government can provide clean water, and for 50 years the majority of Indians didn't have access to clean water. Now they have a capitalist system in place, and clean water is being provided throughout the country, not completely, but a higher percentage than ever before.

So here we are with the same justification. Only government can fix health care. Really? You realize that health care is already the 3rd most highly regulated sector in the US?

Remember how Airlines were highly regulated prior to the 1970s? What happened after deregulation? Cheaper airfare, and more access to air travel to more people, than ever before. Now commuter jets are filled, instead of running half empty with government subsidies. (except in political pork districts which still get subsidized air travel).

Funny how deregulation didn't ruin the airline industry. Funny how the lack of regulation doesn't ruin 99% of the products in our stores.

Yet in this case, in an industry already highly regulated, we have huge problems. And yet your claim is, only more regulation and intervention can fix those problems.

Well I disagree. I think the regulation we have are the direct cause of our problems. More regulation has never fixed anything, will only make things worse.

Look at India. They have a massive socialized care system, and it's junk. But then they have these private pay-for-service hospitals, that people all over the world are flying there to get to. Why? What are they doing differently that is draw people all over the world?

They don't have government control. Same in Singapore. Dozens of government run hospital, and only the private non-government-controlled hospitals are attracting people from all over the world.

I would dare you to give one district in one state, complete exemption from all government regulations. No medicare, no medicaid, no rules, no regulations. And lets see what happens. I would bet you anything, the price of care at those hospitals and clinics would drop like a rock. They would have more services, and lower costs, in a matter of months.

jonny5 · Mar 17, 2012

xpiher said:
That's because the only access to the net I have at this time is on my phone. Anyways, the basic premise is that health insurance unintentionally drives up prices because no onebegin huntswhile at the same time screwing people over by refusing to cover various treatments

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So how does that keep me from paying for others healthcare? The govt takes money from me in taxes, and then spends it on medicaid. That is direct transfer of wealth.

UtahBill · Mar 17, 2012

Re: New CBO health law estimate shows much higher spending past first 10 years

Rhapsody1447 said:
That's the point. That's why conservatives only care about the gross cost estimates. They recognize that revenue projections in 2021, and consequently "deficit savings", are completely unreliable. Frankly the fact that the CBO predicts it will "save" an extra $48 billion over the next 10 years is irrelevant in comparison to the projection it will cost an extra $822 billion.

too bad conservatives didn't properly estimate the cost of the last IRAQ war and give congress a chance to fund it in advance....by taxing gasoline and diesel....

UtahBill · Mar 17, 2012

Sparkles said:
And every country that has plunged into a socialist 3rd world ruins, has always used the exact same justification for their own destruction. .

elaborate? what country has plunged into 3rd world ruins due to socialism or social programs?
For under $100 per month per family, Canadians have adequate health care. Are they 3rd world? How about the many countries in Europe that provide health care and other social needs?

ksu_aviator · Mar 17, 2012

Hare said:
900 billion off? No wonder no one wants to give more money to this administration, their math seems a little fuzzy.

I wonder how far off they are on the unemployment numbers?

JasonI · Mar 17, 2012

CBO | Another Comment on CBO

Another Comment on CBO’s Estimates for the Insurance Coverage Provisions of the Affordable Care Act

March 16, 2012
CBO released two reports this week related to the analysis of the Affordable Care Act (ACA) conducted by CBO and the staff of the Joint Committee on Taxation (JCT). One report presented updated estimates for the insurance coverage provisions of the ACA, and the other responded to questions we’ve received regarding the effects of the ACA on employment-based health insurance.
Some of the commentary on those reports has suggested that CBO and JCT have changed their estimates of the effects of the ACA to a significant degree. That’s not our perspective.
Assessing the impact of broad changes in the nation’s health insurance system, like those in the ACA, requires assumptions and projections about a wide array of technical, behavioral, and economic factors. CBO and JCT, in consultation with outside experts, have devoted a great deal of care and effort to analyzing health care legislation in the past few years—but our estimates are still very uncertain. We will continue to update our estimates regarding health insurance coverage as new information becomes available about the implementation of the ACA, underlying trends in the health care and health financing systems, and the probable responses to the legislation by businesses, families, and others. In addition, we are continually trying to improve our modeling techniques and estimating procedures.
It is certainly possible that—at some point—new legislation, new information, and new models or estimating procedures will lead us to make significant changes to our estimates of the effects of the ACA. So far, however, that has occurred for only one significant provision of the ACA—the CLASS long-term care insurance program, which the Administration has concluded it cannot implement. (For more information on that topic, see this letter.)
For the provisions of the Affordable Care Act related to health insurance coverage, CBO and JCT’s latest estimates are quite similar to the estimates we released when the legislation was being considered in March 2010. The following figure shows CBO and JCT’s projections of the effects of the ACA on the number of people who will be uninsured or will receive insurance coverage through employer-sponsored insurance (ESI), insurance exchanges, or Medicaid or the Children’s Health Insurance Program (CHIP). Although the latest projections extend the original ones by three years (corresponding to the shift in the regular 10-year projection period since the ACA was first being developed), the projections for each given year have changed little, on net, since March 2010.

xpiher · Mar 17, 2012

Sparkles said:
And every country that has plunged into a socialist 3rd world ruins, has always used the exact same justification for their own destruction. Only government can provide clean water, and for 50 years the majority of Indians didn't have access to clean water. Now they have a capitalist system in place, and clean water is being provided throughout the country, not completely, but a higher percentage than ever before.

So here we are with the same justification. Only government can fix health care. Really? You realize that health care is already the 3rd most highly regulated sector in the US?

Remember how Airlines were highly regulated prior to the 1970s? What happened after deregulation? Cheaper airfare, and more access to air travel to more people, than ever before. Now commuter jets are filled, instead of running half empty with government subsidies. (except in political pork districts which still get subsidized air travel).

Funny how deregulation didn't ruin the airline industry. Funny how the lack of regulation doesn't ruin 99% of the products in our stores.

Yet in this case, in an industry already highly regulated, we have huge problems. And yet your claim is, only more regulation and intervention can fix those problems.

Well I disagree. I think the regulation we have are the direct cause of our problems. More regulation has never fixed anything, will only make things worse.

Look at India. They have a massive socialized care system, and it's junk. But then they have these private pay-for-service hospitals, that people all over the world are flying there to get to. Why? What are they doing differently that is draw people all over the world?

They don't have government control. Same in Singapore. Dozens of government run hospital, and only the private non-government-controlled hospitals are attracting people from all over the world.

I would dare you to give one district in one state, complete exemption from all government regulations. No medicare, no medicaid, no rules, no regulations. And lets see what happens. I would bet you anything, the price of care at those hospitals and clinics would drop like a rock. They would have more services, and lower costs, in a matter of months.

Hoes many times gas the air line industry been bailed out since then? Also, part of the reason why the gov gas to get involved is because of hoe involved they already are by repealing laws and passing others (allowing insurance to be did across state lines for instance). I for one think one of the good things to come out of Congress care is the removal life term caps. This forces the insurance company to honor its contact by not kicking people of the rolls once they get sick, thus screwing them for life.

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OpportunityCost · Mar 17, 2012

UtahBill said:
elaborate? what country has plunged into 3rd world ruins due to socialism or social programs?
For under $100 per month per family, Canadians have adequate health care. Are they 3rd world? How about the many countries in Europe that provide health care and other social needs?

Greece? C'mon make the questions harder.

UtahBill · Mar 17, 2012

OpportunityCost said:
Greece? C'mon make the questions harder.

For a very long time the primary national pastime in Greece has been tax evasion....
Some of the rich claimed incomes less than they paid their pool cleaning service.
It wasn't socialism that caused them to fail, it was selfishness and greed and plain old lack of patriotism.
and Greece is hardly 3rd world, altho a good part of the reason the rich can evade taxes is that Greece hasn't modernized its tax collection system. It is too easy to avoid paying taxes....

UtahBill · Mar 17, 2012

It takes more than having the word "socialist" in their names to make a country socialist, since a lot of them are really communist or dictatorships....
Try the following for successful socialism...that are not 3rd world or dictatorships or communist...
Canada
France
Sweden
United Kingdom

jonny5 · Mar 18, 2012

UtahBill said:
It takes more than having the word "socialist" in their names to make a country socialist, since a lot of them are really communist or dictatorships....
Try the following for successful socialism...that are not 3rd world or dictatorships or communist...
Canada
France
Sweden
United Kingdom

All of those have capitalist economies.

UtahBill · Mar 18, 2012

jonny5 said:
All of those have capitalist economies.

and socialistic programs, just like the USA....but more socialistic than we are.....
all "first" world countries have social programs, socialism is used to different dgrees, that is the only difference...

UtahBill · Mar 18, 2012

Universal Health Care in Other Countries

a good read...

CBO: Obamacare to cost $1.76 Trillion over 10 years

Rhapsody1447

Skeptical Optimist

Sparkles

Rhapsody1447

Skeptical Optimist

Sparkles

jonny5

xpiher

Well-known member

Sparkles

xpiher

Well-known member

Sparkles

xpiher

Well-known member

Sparkles

xpiher

Well-known member

Sparkles

jonny5

UtahBill

UtahBill

ksu_aviator

Democrats are the fascists

JasonI

xpiher

Well-known member

OpportunityCost

UtahBill

UtahBill

jonny5

UtahBill

UtahBill