The President’s Health Proposal: Further Jacking Up the Cost of Care

Kathryn Nix / February 24, 2010

In anticipation of the February 25^th health care summit with members of Congress, the President released his proposal for pricey, government-run health care.  The White House estimates the cost of the proposal to be $950 billion over a decade, decreasing the federal deficit.  However, health policy expert James Capretta, a former senior official of the Office of Management and Budget (OMB),  shows in a recent paper that this is not only inaccurate, but far from reality.  Capretta’s research shows that ten full years of implementation of the President’s proposal would cost closer to $2.5 trillion, with the strong likelihood of far exceeding this amount.  Here’s how:

• The President’s proposal ignores “doc fix” legislation, which would cost roughly $200 billion over ten years.  As Capretta notes, it is ironic that the President does not account for this provision, but includes several other Medicare provisions in his proposal.

• Non-coverage spending would add about $90 billion to the cost of the bill.

• Cost estimates for the President’s plan should apply to the ten year window from 2011 to 2020—not to 2019.  This would add approximately $200 billion more to the cost of the bill. (more…)