Coal in your stocking courtesy of the double-counting in the Reid bill:
CBO and the staff of the Joint Committee on Taxation (JCT) estimated that the PPACA, incorporating the manager’s amendment, would reduce Part A outlays by $245 billion and increase HI revenues by $113 billion during the 2010-2019 period. Those changes would increase the trust fund’s balances sufficiently to postpone exhaustion for several years.
However, the improvement in Medicare’s finances would not be matched by a corresponding improvement in the federal government’s overall finances. CBO and JCT estimated that the PPACA as amended would add more than $400 billion ($245 billion + $113 billion + interest) to the balance of the HI trust fund by 2019, while reducing federal budget deficits by a total of $132 billion by 2019.
The reductions in projected Part A outlays and increases in projected HI revenues would significantly raise balances in the HI trust fund and create the appearance that significant additional resources had been set aside to pay for future Medicare benefits. However, the additional savings by the government as a whole — which represent the true increase in the ability to pay for future Medicare benefits or other programs — would be a good deal smaller.
The key point is that the savings to the HI trust fund under the PPACA would be received by the government only once, so they cannot be set aside to pay for future Medicare spending and, at the same time, pay for current spending on other parts of the legislation or on other programs.
So people have begun to notice that the Reid bill double-counted revenues to make the erroneous claim that Medicare would be helped and the Federal budget deficit reduced, when only one of those things could be true. But by the time people noticed, the deal was done and everyone had left town.
At the end of the day, who cares? It’s less than a trillion dollars so it’s pretty much rounding error. And it’s small beer compared to some of the antics that have gone on over this past year. So Merry Christmas and let’s hope 2010 is an improvement.