Meanwhile, Orszag fails to address the relevant criticisms made by deficit neutrality skeptics. First is that the bill's supporters double count the Medicare savings. According to a December report by Orszag's trusted arbiter, the CBO, the bill will either reduce the deficit or extend the solvency of Medicare, not both. (And for what it's worth, Medicare's chief actuary agrees.) Yet as recently as March 10—yesterday—Obama was claiming that his health care plan would "help ensure Medicare’s solvency for an additional decade." Great! But according to the CBO, that means the bill won't actually cut the deficit.
The other problem is that, in an effort to elicit a better score for the bill, the "doc fix"—an expensive, unfunded change in the way doctor's Medicare payments are made—was excluded from the bill. So, as scored, the bill assumes that there will be a massive cut in Medicare payments to doctors that almost certainly will not occur.
The liberal argument for this is that the doc fix would have to be passed no matter what, so it shouldn't count towards the health care bill's score. Maybe so, but that's not what House Democrats thought when they drew up their initial draft of the legislation. And Senate Majority Leader Harry Reid was more than willing to hold the fix over doctors' heads in order to ensure that they would support the Democrats' reform legislation.
And what does our good friend the CBO say? Well, if you enact the doc fix in conjunction with Obama's health care overhaul, it adds $89 billion to the deficit over the first ten years.
