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CBO Says Healthcare Bill is NOT Budget Neutral

The Affordable Health Choices Act (Act) has been hotly contested by many Republicans, some Democrats, and now, is being put in place by Congressional Budget Office (CBO). The CBO is the final authority when it comes to the cost of legislation and it announced that the Act is not “budget neutral” like President Obama and many Congressmen allege.

According to the CBO, the Act will add roughly $240 billion to the federal deficit. To pay for the Act, the CBO states that there would be a roughly $583 billion increase in federal revenues and a $245 billion in savings by reforming the Medicare and Medicaid physician payment formula. This new healthcare plan is to provide healthcare coverage for 97% of Americans.

According to Peter Orszag–the Director of the Office of Management and Budget–and Kathleen Sebelius–the Health and Human Services Secretary–the legislation is incomplete, thus CBO’s projection is inaccurate. Orszag explained this past weekend that the “new policy…is budget neutral over the first decade.” He continued to defend the Act by stating that the CBO projection included the current Medicare payment rates for physicians. Orszag continues to explain that “everyone anticipates that even absent healthcare reform, that would be taken care of. If you take that off the table, in terms of new policy, the House bill is deficit neutral.” The supporters of the bill avidly maintain that the bill is incomplete and that the inconsistencies and holes that are being discovered will be finalized prior to passing the bill into law. Additionally, the fact that the bill could yield a $6 billion surplus over the next ten years would offset spending, making the Act budget neutral.

For more information, please call Abby Pendleton, Esq., Robert Iwrey, Esq., Adrienne Dresevic, Esq., Carey F. Kalmowitz, Esq. or Jessica L. Gustafson, Esq. at (248) 996-8510 or visit The HLP website.

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