CBO Releases New Numbers on ObamaCare

The Congressional Budget Office released its updated scoring of the costs and benefits of the PPACA (ObamaCare).  (Via NPR.)  Writes Jeffrey H. Anderson,

The latest CBO scoring of Obamacare, in the wake of the Supreme Court’s 5-4 decision upholding the overhaul’s individual mandate as an allowable (although seemingly unprecedented) tax on inactivity, shows that President Obama’s centerpiece legislation would cost about $2 trillion over its real first decade (2014 through 2023). The CBO also says that — despite its colossal cost and its unprecedented expansion of power and control over Americans’ lives — Obamacare would, as of a decade from now, leave 30 million people uninsured.

The CBO may only base its score on the next ten years of costs and income.  Back in 2010, the cost for ten years of ObamaCare was scored from 2010 to 2020.  Benefits begin to accrue in 2014, although the government began allocating money to it in 2010.  This “ten years of income, six years of expenses” set-up enabled the government to claim that ObamaCare was cost-neutral (or even cost-cutting).  However, when the CBO scored the PPACA from 2012 to 2022, it used eight years of expenses and ten years of income, which changes the net costs.

(Continued below the fold)

Moreover, the PPACA does little to address the underlying reasons that people lack health insurance.   People who lack health insurance can be grouped into several categories: young adults, those who go without insurance for only a few months at a time, adults who can afford insurance but choose to not purchase it, and illegal immigrants. (See here for a comprehensive breakdown of each group.) Only about 8-10 million Americans need health insurance (i.e. are ill) but cannot afford it.

ObamaCare is not designed to target these groups; in fact, it does the opposite.  Young adults, the recently unemployed, and small business owners generally only need (and want) inexpensive, high-deductible plans that are a safeguard against bankruptcy.  They may neither need, want, nor be able to afford premium insurance plans. Likewise, ObamaCare does little to reign in the costs from non-citizens.  In Massachusetts, illegal aliens have cost the Commonwealth $93 million per year.

Any health care reform that is not targeted to the needs of those who are currently uninsured will not increase insurance rates.  By the CBO’s own estimates, ObamaCare will cost $2 trillion over ten years and will insure an additional 20 million people.  Basic math tells us that the PPACA is not an “affordable care” system.

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Filed under Economics, ObamaCare

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