Health care reform: fully paid for?

Investors Business Daily reports that Sen. Max Baucus claims he has found $600 billion in cuts that can be made to spending on proposed health care reforms after the Congressional Budget Office’s analysis revealed last week that President Obama’s reforms were projected to overshoot his original cost estimate of $1 trillion by just that much.

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There are a few reasons to doubt a claim that health care reforms are “fully funded.” First, the federal government’s debt is massive, as is its deficit, so realisitically, even if costs are just shifted, none of it is paid for until the government severely reins in spending.

Additionally, federal programs are notorious for cost overruns. Even if the CBO believes that health care reforms can be achieved for “only” $1 trillion, it’s unlikely that the costs will stay within those bounds even in the short run, let alone the long run.

Finally, many of the president’s plans for reining in spending are unlikely to achieve that goal. The Wall Street Journal pointed out a while ago that too many of President Obama’s proposals require a leap of faith, and savings through health reforms are just such a proposal. The “underpants-gnomism” goes like this:

  1. Implement reforms to achieve savings.
  2. ???
  3. Savings!

It’s positive to see Americans cooling to even very nice ideas when the costs start getting out of control — they shouldn’t be fooled by politicians trying to convince them costs won’t be an issue.