Future Medicare Costs Exaggerated In Obama's Budget To Make ObamaCare Look Prettier [Updated Diagram Weblink]

For the first time by any administration in memory, the Obama budget forecast rejects the Medicare Trustees’ projections for long-run healthcare cost growth. Why would the White House do this?

The Obama administration’s fiscal year 2011 budget continues a pattern of ignoring independent analysis and rigging economic assumptions to meet political goals. For the first time by any administration in memory, the Obama budget forecast rejects the Medicare Trustees’ projections for long-run healthcare cost growth. The reason: the Trustees’ projections undercut the administration’s narrative that increased federal control over private sector healthcare could painlessly reduce Medicare and Medicaid costs. The Obama budget instead assumes long-term health cost growth at twice the rate projected by the Trustees.

***

...population aging is by far the biggest contributor to entitlement spending over the next several decades and will be the principal cost driver through the mid-2050s. Partly as a result of these analyses, Orszag’s successor at the Congressional Budget Office, Douglas Elmendorf, altered the agency’s presentations to more accurately reflect aging’s role.

In other words, even if healthcare overhaul managed to “bend the cost curve” and reduce per-capita health spending, the surge of retirees collecting Medicare, Medicaid, and Social Security benefits would still push government spending ever upwards. Thus, the facts undermine the administration’s argument for greater regulation over private-sector healthcare.

From "Obama Budget Rigs Healthcare Numbers" by Andrew G. Biggs in the Journal of the American Enterprise Institute.