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U.S. News and Commentary



Wednesday
Mar172010

CBO can’t gauge discretionary spending in HR 3590 because ‘sufficient guidance’ lacking

Rep. Mike Pence addresses the House. On Wednesday, he appeared on MSNBC to explain why the healthcare bill will fail at real healthcare reform.At present Democrats and President Barack Obama are pushing healthcare legislation under the pretense it will save Americans money and make insurance affordable to some of the uninsured. Republicans have criticized the Senate version of healthcare, HR 3590, the Patient Protection and Affordable Care Act, for its cost. Democrats have responded it will save money over time and that position has been echoed by sympathetic pundits and analysts across cyberspace and TV Land.

Fact is, no one really knows exactly what it will cost and a March 15 statement at the Congressional Budget Office explains why. Furthermore, most members of Congress do not know what is in the complicated bill because they haven’t seen it.

Acknowledging what amounts to startup costs for the Internal Revenue Service and the US Dept. of Health and Human Services, the CBO attempted to calculate estimates for “discretionary spending.” 

CBO acknowledged the full impact of discretionary spending in HR 3590 cannot be determined.[Screen Snip from CBO table]

Discretionary spending total eludes
CBO pointed out the following:

"Major costs for such activities subject to future appropriation would include:

• Costs to the Internal Revenue Service (IRS) of implementing the eligibility determination, documentation, and verification processes for premium and cost sharing credits. CBO expects that those costs would probably be between $5 billion and $10 billion over 10 years.

• Costs to the Department of Health and Human Services, especially the Centers for Medicare and Medicaid Services, and the Office of Personnel Management of implementing the changes in Medicare, Medicaid, and the Children’s Health Insurance Program, as well as certain reforms to the private insurance market. CBO expects that those costs would probably be at least $5 billion to $10 billion over 10 years. (The administrative costs of establishing and operating the exchanges were included as direct spending in CBO’s estimate for the legislation.)"

More than $50 billion needed, but cost of personal liberty in question
CBO addresses only the costs, but of added concern to civil libertarians is the unprecedented amount of power transferred by this bill to two federal agencies.

 CBO projects more than $50 billion in costs for the discretionary spending itemized in the table on the government website. That’s the spending that can be projected. None of that amount will be spent for healthcare, but for government infrastructure.

For instance, IRS will need an enforcement group to determine whether you're violating the law by not buying health insurance.

CBO admits there is no way to come up with a total for the discretionary spending:

“The table does not represent a complete estimate of all discretionary costs associated with PPACA, because it excludes the implicit costs to the IRS and HHS that are described above as well as explicit authorizations in PPACA for programs for which amounts of spending are not specified for any year. In particular, the legislation would authorize many additional new activities with a broad authorization of the appropriation of 'such sums as may be necessary.' CBO has not yet completed estimates of the amounts of such authorizations, and, in some cases, the legislation does not offer sufficient guidance to determine estimates of what the “necessary” amounts might be.”

Confusion surrounds Democrats on HR 3590 
Because of fraud, the government faces a critical challenge in managing the healthcare programs it has already assumed control of.  At present, Medicare loses $1 of every $7 the program administers—14 percent of total payouts.

The full text of HR 3590 has not been posted publicly, but Democrats and Obama aim to push it through despite the fact most members of Congress have not read the bill.

The Associated Press confirmed on Wednesday what The US Report has asserted for months. Premiums will rise for most American families opting for good coverage unless they qualify for federal assistance.

Polls have consistently shown the American people do not want the Democrat healthcare bill. On Wednesday Rep. Mike Pence (R-Ind.) summed up public sentiment about HR 3590 for MSNBC: "The American people do not want a government takeover of healthcare."(--by Kay B. Day/March 17, 2010)

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