Posted by
Defend America on Thursday, November 19, 2009 4:04:19 PM
In a letter to Rep. Paul Ryan, the CBO explains that Reid is wrong about his deficits claim:
Dear Congressman:
This letter responds to questions you have asked about Medicare’s payments to
physicians and the budgetary effects of H.R. 3961, the Medicare Physicians Payment
Reform Act of 2009, as introduced on October 29, 2009. In particular, you inquired about
the budgetary impact of a new regulation specifying how payments to physicians should
be determined under current law and about the total budgetary impact of enacting both
H.R. 3961 and H.R. 3962, the Affordable Health Care for America Act.
...
The Budgetary Impact of Enacting Both H.R. 3961 and H.R. 3962
Under current law, including the new rule, Medicare’s payment rates for physicians’
services will be reduced by about 21 percent in January 2010, and CBO estimates those
payment rates will be reduced by about 2 percent annually for several subsequent years.
H.R. 3961 would increase those payment rates by 1.2 percent in 2010 and restructure the
SGR beginning in 2011. Those changes would result in significantly higher payment
rates for physicians than those that would result under current law. CBO estimates that
enacting H.R. 3961, by itself, would cost $210 billion over the 2010–2019 period.2
H.R. 3962, the Affordable Health Care for America Act, would establish a mandate for
most legal residents of the United States to obtain health insurance, set up insurance
“exchanges” through which certain individuals could receive federal subsidies toward the
purchase of such insurance, and make numerous other changes in the health insurance
system, in federal health care programs, and in the federal tax code. CBO and the staff of
the Joint Committee on Taxation estimate that enacting H.R. 3962, by itself, would
reduce federal budget deficits by $109 billion over the 2010–2019 period through its
effects on direct spending and revenues.3
CBO estimates that enacting both H.R. 3961 and H.R. 3962 would add $89 billion to
budget deficits over the 2010–2019 period. That amount is about $12 billion less than the
sum of the effects of enacting the bills separately. The $12 billion difference results from
two types of interactions. The higher payment rates for physicians’ services under
H.R. 3961 would increase the net cost of provisions in H.R. 3962 by about $3 billion.
However, that difference would be more than offset by the effect of a change under
H.R. 3962 in how payment rates for Medicare Advantage plans are set. That change
would reduce the effect of the changes made by H.R. 3961 to Medicare’s payments for
physicians’ services in the fee-for-service sector on payment rates for Medicare
Advantage plans. As a result, the estimated increase in payments to Medicare Advantage
plans would be $15 billion smaller if both bills were enacted than under H.R. 3961 alone.
http://www.house.gov/budget_republicans/press/2007/pr20091119cboscore.pdf