CBO says health bill increases deficits under Rep. Ryan's assumptions

The Congressional Budget Office (CBO) said the healthcare bill would add billions to the country's debt if lawmakers ignore the bill's cost constraints, as Rep. Paul Ryan (R-Wis.) expects them to do.

Under the scenario painted by Ryan, CBO said the healthcare bill's $138 billion in savings over 10 years would disappear because the government would: extend the current Medicare doctor payment rate instead of allowing it to expire; allow health insurance subsidies to grow at a sustained rate; and fail to implement a tax on high-cost health plans and an independent Medicare advisory board, two measures aimed at constraining federal health costs.

The CBO made those estimates, released Friday, at the request of Ryan.

Ryan and Republicans argue that such a pessimistic scenario will become a reality because it's the politically easier course.

They note that House Democratic leaders plan to extend the current level of doctor payments in legislation separate from the healthcare reform bill instead of allowing the payments to fall by 21 percent in April, as they're scheduled to. Democrats pushing for the so-called "doc fix" noted Republicans also enacted an extension of the higher payment level last decade without paying for them.

The Medicare physician payment rate extension, which costs $208 billion over 10 years, would be enough by itself to wipe out the deficit reduction.

The CBO said that if Ryan's other assumptions become reality, the deficit would increase by $260 billion over 10 years and likely by a greater amount in the bill's second decade -- a level equal to 0.25 percent of gross domestic product.

The CBO estimated Thursday the healthcare bill and a reconciliation package of fixes to it would result in savings equivalent to a half-percent of gross domestic product in the legislation's second decade. In nominal dollars, that number would likely exceed $1 trillion if the economy continued to grow at a steady pace.