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Cost of health bills debatable
It's difficult to pin number on reform
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November 29, 2009 - 12:00 am

How much will health care reform cost? The answer, according to some independent experts, is we don't know.

"The difficulty is there is no truth," said Dr. Robert Woodward, a professor of health economics at the University of New Hampshire. "We're all talking about what's going to happen in the future."

The official estimate from the Congressional Budget Office said the current Senate bill includes $848 billion of spending over 10 years. With added taxes, fees and cuts to Medicare, the bill is estimated to cut the deficit by $130 billion.

Republican Sen. Judd Gregg and Senate budget committee Republicans call that estimate a "shell game." Gregg said savings would begin early in the decade, while the costly provisions of the bill won't kick in until 2014. The real cost of the fully implemented bill will be $2.5 trillion over 10 years, he said, despite tax increases and Medicare cuts.

Gregg said the bill assumes unrealistic cuts in Medicare reimbursement rates to doctors. It projects savings from a new insurance program for disabled adults, which would later turn to deficits.

But Jonathan Gruber, a health economist at MIT who advises the Obama administration, said the CBO estimates the bill would lower the deficit both this decade and next.

"At the end of the day, if you want to evaluate whether the bill's going to save money or not, you have to go with the objective score by a scoring agency, not by a political position," he said.

Gruber rejects the argument that government cannot make the cuts it says it will. "If you accept these concerns, government's paralyzed," he said. "If government can't keep promises, it can't do anything."

Steve Norton, director of the New Hampshire Center for Public Policy said cost estimates depend on assumptions regarding how the health care market will change and how effective the government can be at controlling Medicare costs.

Short-term, Norton said, the bill changes how government pays for health care but does not save significant costs in the health care system. "The initiatives that were put in the bill lay the groundwork for cost controls in the future, but any real impact from a cost perspective is likely to be out a number of years," Norton said. These include research on treatments' effectiveness, use of technology and paying medical organizations for patient outcomes.

Woodward said questions include whether newly insured people would come to the hospital more frequently, driving up costs. Or whether hospitals would lower costs once they no longer have to pay for so much uninsured care. He recalled the implementation of Medicare, when predictions that health care expenditures would spike were unfounded.

Woodward pointed to the scheduled cut in Medicare reimbursements, which is regularly reversed, to question whether Congress can use future savings to pay for costs. "We certainly can. Whether we will or not is a different question," he said.

But Woodward said that while there are risks, there are also benefits. "One way to look at it is, what risks do we want to take in order to give some level of equal access to health care here in the United States?" he said.

Running for governor

Republican Karen Testerman will announce Dec. 7 that she is forming an exploratory committee to run against Democratic Gov. John Lynch.



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