Orszag: Healthcare law doesn’t include more spending than previously reported

The new healthcare law doesn’t include more spending and less deficit reduction than previously reported, an Obama administration official said Wednesday. 

Instead, a letter released by the Congressional Budget Office on Tuesday “simply updates” the calculation of the size of discretionary authorizations included in the legislation, Office of Management and Budget Director Peter Orszag said today in his blog. 

Opponents of the healthcare law have touted the updated estimate as a we-told-you-so increase of $115 billion in spending, which Orszag said is wrong to conclude. He reiterated that the law will reduce deficits by more than $100 billion this decade and more than $1 trillion in the following 10 years, writing that it’s the “largest deficit reduction package enacted in over a decade according to CBO.”

He outlined why the conclusions have been drawn that the CBO letter reflects more spending. 

Authorizations aren’t spending and are only “expressions of what Congress would like to spend money on, not what it will spend money on,” Orszag said. Authorizations are “subject to future appropriation actions, which could result in greater or smaller costs than the sums authorized by the legislation,” CBO said in the letter.

President Barack Obama has made a “firm commitment to freezing non-security discretionary funding for the next three years,” which he has vowed to enforce with a veto. So any actual new funding would have to fit within the freeze, he said. 

He also said that several of the authorizations — including the largest reported in the CBO letter — are “simply new authorizations of spending that already exist,” meaning it doesn’t represent new spending. 

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