Reality Check: Repeal of Obamacare Would Not Increase the Deficit

Kathryn Nix / January 06, 2011

As the new Congress settles in, the House of Representatives prepares to vote on January 12 on a measure to repeal Obamacare. Proponents of the health care law claim that repeal would increase the federal deficit and that a vote to kill Obamacare without offsetting the “cost” is hypocritical.

This couldn’t be more wrong. For starters, Obamacare will not reduce the deficit. Though the Congressional Budget Office (CBO) projected that the health law would create $124 billion in savings, the CBO is required to make unlikely assumptions and disregard budget gimmicks included in the legislation. Taking this into account causes the cost of Obamacare to skyrocket.

First, Obamacare does not include the “doc fix” to prevent an automatic cut to physicians’ reimbursement rates under Medicare. Earlier versions of reform included a fix, which made those proposals tip heavily into the red. Congress recently passed a one-year fix and will continue to prevent the cuts in the future, but it will still not solve the ongoing problem. Nevertheless, pretending it will not happen won’t reduce the deficit. (more…)