Smoke and mirrors on steroids

The Senate's health care reform bill is deficit neutral only if you believe Congress will cut payments to doctors for reimbursements, raise taxes to unprecedented levels, and slash a half-trillion dollars from Medicare. James Capretta details the "$4.9 trillion spending increase"

For starters, the Reid plan assumes that Medicare physician fees will get cut by about 20 percent beginning in 2011 and then remain very restrained indefinitely. Virtually no one in Congress believes that will happen, nor do they want it to.

In the first ten years, CBO says it would total nearly $500 billion, which is bad enough. But in the second decade, the tax increase would balloon to about $1.7 trillion, in large part because of the hidden tax hikes associated with bracket creep. Over 20 years, Senate Democrats are thus planning to raise taxes on the American people by about $2.2 trillion.

Finally, there are the Medicare cuts. Despite all of the talk of “delivery system reform,” the Senate Democratic plan would not transform American medicine to make it more efficient. No, they would simply cut payment rates for providers of services. On paper, the cuts are massive. CBO says they would total nearly $450 billion in Medicare over the first ten years, but then grow to about $1.9 trillion in the next decade. Just like physician fees, virtually no one believes Congress will sustain arbitrary payment rate cuts of this magnitude.

Here's the wrap-up:

On paper, the Reid plan plus the “doc fix” would increase total federal spending by about $4.9 trillion over 20 years. Senate Democrats would resort to bracket creep and other tax hikes to raise $2.2 trillion over the same period. The balance would be made up with spending reductions, mainly in Medicare, that no one believes can be sustained, and in any event do not constitute “health reform.” In other words, it’s a tax-and-spend bill of the highest order. And only the spending is certain to happen.

At the very moment in history when the Baby Boomers are poised to tip entitlement spending into the stratosphere, Obamacare will dwarf those programs and bankrupt this country. Nobody can explain away this math. Oh, yeah, and the whole deal may be unconstitutional to boot.