New study says costs rise under health bill

Published: Saturday, Nov. 14, 2009 4:13 p.m. MST
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WASHINGTON — Overall spending on health care would rise as a result of legislation approved a week ago by the House, and billions of dollars in projected savings contained in the measure will be difficult to maintain, according to a report by a top official at the agency that oversees Medicare.

The legislation would expand insurance coverage to an estimated 32 million people who now lack it, according to the report, creating a demand for services that "could be difficult to meet initially ... and could lead to price-increases, cost-shifting and/or changes in providers' willingness to treat patients with low-reimbursement health coverage."

The analysis was issued by Richard Foster, the chief actuary at the Centers for Medicare and Medicaid, which is part of the Health and Human Services Department. The study was conducted at the request of House Republicans, who quickly tried to turn it against the Obama administration.

Rep. John Boehner of Ohio, the House GOP leader, issued a statement saying the study "confirms that this bill violates President Obama's promise to 'bend the cost curve.' It's now beyond dispute that their bill will raise costs."

But Brendan Daly, a spokesman for House Speaker Nancy Pelosi, D-Calif., said the report "shows that our health reform bill will extend the life of the Medicare trust fund by five years, significantly longer than any proposal in recent years."

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The same report "estimates that our bill will cover 10 percent more of the population with less than a 1.3 percent increase in national health expenditures that illustrates a bending of the cost curve," he added.

Obama and congressional Democrats have said one of their goals with the legislation is to slow the growth of health care costs nationally.

With one exception, Republicans voted against the legislation when it cleared the House, and the GOP now is girding for a fight in the Senate, where debate on health care is expected to begin within days.

In the party's weekly radio and Internet address, Rep. Mark Kirk of Illinois accused House Democrats of missing opportunities to improve the legislation when they rejected Republican proposals to limit lawsuits and give states more flexibility to enact innovative changes.

Kirk, who is running for the Senate in next year's elections, said health care costs could be lowered by "reining in lawsuits" and allowing consumers to buy coverage from across state lines.

The report issued by Foster estimated that as a result of the legislation total health expenditures would be an estimated $289 billion higher in the coming decade than would otherwise be the case, slightly less than 1 percent.

Recent comments

Fix the system, then the lawsuits.

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