Independent healthcare cost analysis becomes political football

An independent cost analysis of the Senate's healthcare reform bill became ammunition for both parties on Friday, with Democrats defending the analysis and Republicans calling it "a roundhouse blow" to the bill.
 
Richard Foster, chief actuary for the Centers for Medicare and Medicare Services -- a division of the Department of Health and Human Services -- issued a report late Thursday in response to a request by GOP Sen. Mike Johanns (Neb.). The report studied the bill currently pending on the Senate floor, cobbled together by Majority Leader Harry Reid (D-Nev.) from two different bills.
 

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Foster found the bill "includes numerous provisions that would reduce Medicare costs," while raising a hospital payroll tax rate for wealthier patients. In all, Foster said the bill would extend the financial life of Medicare by nine years, from its current estimated bankruptcy date of 2017 to 2026. Foster also estimated a lower federal deficit: "The combination of lower... costs and higher tax revenues results in a lower Federal deficit based on budget accounting rules."
 
Republicans assailed the analysis, however, focusing on the increased spending of $234 billion from 2010 to 2019 that Foster noted, as well as various conclusions in his analysis that access to Medicare services could be jeopardized as the system grows to accomodate more Americans. Foster also found that the bill would reduce the number of uninsured Americans from 57 million to 24 million, which Republicans said still represents a failure.
 
"We had representations that the purpose of this health care reform was to decrease, to move down the healthcare costs. Now we find that this bill significantly increases the national healthcare expenditures," said Sen. Judd Gregg (R-N.H.). "It appears the Reid bill clearly fails that test and gets an 'F' on the issue of vetting the healthcare costs down and on the issue of insuring everyone."
 
GOP Leader Mitch McConnell (Ky.) and other senior Republicans also took to the Senate floor on Friday to tout Foster's analysis, and told reporters at a press conference that the analysis proved their points.
 
"We wanted to be revenue-neutral and we wanted to be sure that long-term, we were going to reduce healthcare inflation," said Sen. Chuck Grassley (Iowa), ranking Republican on the Senate Finance Committee. "Now, on a partisan bill, we're about to spend 2.5 trillion on a bill that does neither."

Johanns also called the analysis a "roundhouse blow to the Reid bill," while Sen. John McCain (R-Ariz.) said it "should put the dagger in the heart of the Reid bill."

White House spokeswoman Linda Douglass, who heads the Obama administration's healthcare publicity effort, issued a statement accusing the GOP of distorting Foster's analysis.

"How did reform's opponents manage to use this report to claim that costs will increase?" Douglass said. "They cherry-picked total expenditures at a singular, fixed point in time – ignoring the overall rate of cost growth, the impact on Medicare and America’s seniors, and the fact that millions of more Americans will be covered."