The 2010 federal healthcare overhaul will add up to $527 billion to the national debt over the next 10 years, according to a new analysis by one of the two public trustees for Medicare.
The study by Charles Blahous, the Republican trustee for Medicare and Social Security appointed by President Barack Obama, challenges the so-called double counting that allowed supporters of the law to claim it will provide net reductions in federal healthcare spending and extended solvency for Medicare.
The study concluded that if the new tax revenue and reduced federal Medicare spending are allocated to extending the solvency of the Medicare Hospital Insurance Trust Fund, as the law requires, then much of the law's new spending will add between $346 billion and $527 billion within 10 years to the deficit. Blahous' calculations run counter to traditional federal scorekeeping that allowed the nonpartisan Congressional Budget Office to estimate that the law would cut deficits by $143 billion in its first 10 years and would extend the solvency of Medicare by 10 years.
“The combination of these two effects exceeds the cost-saving measures in the legislation,” according to the Blahous report. “This results in the worsening of federal deficits relative to previous law.”