The Senate healthcare reform legislation would save Medicare's trust fund from insolvency, but increase gross federal debt over the next 10 years, according to a
new analysis by the Congressional Budget Office.
Gross federal debt reflects debt held by the public and debt issued to government accounts.
Responding to a request by Sen. Jeff Sessions (R-Ala.), ranking member of the Senate Judiciary Committee, the CBO estimates the Patient Protection and Affordable Care Act would reduce public debt by more than $132 billion by the end of 2019. At the same time, however, the bill would rack up government debt by increasing the balance in Medicare's Hospital Insurance Trust Fund by more than $358 billion during this time period to pay for future Medicare benefits.
Given changes in the financial flows of the trust fund, the CBO estimates the fund would experience a positive balance of about $170 billion at the end of fiscal 2019,
$50 billion more than what the CBO previously estimated several months ago. The trust fund is currently scheduled to expire by 2017, according to the CBO's March 2009 forecast.
With few alternatives remaining to approve comprehensive health reform, the option for the House to approve the Senate bill may still be on the table. House Speaker Nancy Pelosi (D-Calif.) last week said her chamber would not have the votes to pass the Senate bill, although it could always be amended later through “corrective” legislation.
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