Paying for Obamacare: Kicking the Can Down the Road to Future Generations

Kathryn Nix / June 04, 2010

Health care reform was supposed to lower health care spending while expanding access for the uninsured.  Instead, though Obamacare will cost taxpayers trillions, it will do little to address the rising cost of care.  The government overhaul will not only have large and immediate negative effects for Americans of every ilk, but will have severe implications for future generations, amassing more federal debt to kick down the road to tomorrow’s taxpayers.  In a recent paper, Heritage expert James Capretta lays out the several ways in which Obamacare will add to, rather than reduce, federal deficits:

• Omission of the “Doc Fix”: “The Obama Administration and leaders in Congress chose to use all of the tax hikes and spending cuts they could find to create another new entitlement instead of paying for a fix for Medicare physician fees.”  According to Capretta, the cost of the doc fix will fall between $250 and $400 billion over a decade.
• Double-Counted CLASS Act Savings: The CLASS Act creates a long-term insurance program where enrollees must pay premiums for five years prior to receiving benefits.  Writes Capretta, “premiums paid by enrollees build a small surplus—about $70 billion over 10 years according to CBO—which the health law’s proponents claim as deficit reduction. But these premiums will be needed in short order to pay actual claims.” (more…)