Healthcare reform would not only rein in government spending but also bolster the economy in the long run, the Obama administration argued Monday.
Council of Economic Advisers (CEA) Chairwoman Christina Romer said that the health bills before Congress would mean a long-term reduction in both public and private spending on healthcare, meaning an overall boost for the U.S. economy.
"Our bottom line is that the bills as they're coming through will slow the growth rate of spending, both public and private," Romer said in a conference call promoting a new CEA report, which says that the bills in Congress could slow the rate of healthcare spending by one percent per year "over an extended horizon."
The bill's effects on both employment and unemployment, "at first approximation, should be zero," Romer said, adding that the new rules in the bill would free up individuals' and business' resources to reinvest in the economy.
"That means that GDP can be higher," she said. "We think that by 2030, properly measured GDP would be 4 percent higher than it would have been."
Romer added that such economic growth could translate to as much as a $7,000 increase in median family income over time.
Update, 11:16 a.m.: House Minority Leader John Boehner (R-Ohio) responds:
Instead of putting out more phony reports, the White House should acknowledge what independent experts have found: The Democrats’ health care bill will increase costs. The American people don’t want a government takeover of health care, yet Democrats refuse to listen to their concerns about how their bill would increase costs, raise taxes, add to our skyrocketing debt, and put bureaucrats in charge of decisions that should be made by patients and doctors. That’s why we need to start over on a common-sense plan that lowers costs and expands access at a price tag our nation can afford.
Senate Republican aides also pointed to a litany of reports from the Congressional Budget Office, Center for Medicare & Medicaid Services (CMS) and other experts arguing that health reform legislation would only do the opposite of what Romer claims.