New report: CBO underestimates savings from health bills but economists worry savings aren't enough

"Previous analyses have underestimated the potential cost-saving effects of the House and Senate health reform bill, according to a new report co-authored by the Center for American Progress Action Fund and the Commonwealth Fund," Modern Healthcare reports. "The House bill, for example, would reduce the deficit by nearly $459 billion over 10 years, approximately $300 billion more than what the Congressional Budget Office estimated, the report found. It also cited larger deficit-reduction figures for the Senate bill, $409 billion over 10 years, compared with the CBO's projection of $130 billion." The authors of the report explained that that the CBO "attempted to estimate, or 'score,' the federal budget impact of each of these bills," which "is not the same as analyzing the health system impact" (Lubell, 12/7).

Meanwhile, also on the topic of costs and savings, Swampland, Time Magazine's political blog, reports that "A few weeks back, the White House was jubilant when 23 prominent economists sent a letter to President Obama endorsing key elements of the Senate health care bill. Today, nearly all of those same economists and a few others ... sent another letter. This one, to Senate Majority Leader Harry Reid, has a more wary tone. The language is somewhat difficult to decipher. … But set against the context of the way politics are being practiced with regard to health care policy, it carries an unmistakable warning: The legislative process is grinding away some of the most important promised reforms in the health care system -- and the promise that this legislation will deliver better health care to Americans at lower cost." For example, the letter asks Reid "to put the teeth back into a proposed independent commission to oversee Medicare spending" (Tumulty, 12/7).

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This article was reprinted from khn.org with permission from the Henry J. Kaiser Family Foundation. Kaiser Health News, an editorially independent news service, is a program of the Kaiser Family Foundation, a nonpartisan health care policy research organization unaffiliated with Kaiser Permanente.