Simply Politics and News

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Dec. 23 (Bloomberg) -- The Congressional Budget Office challenged claims by health-care overhaul proponents that Medicare savings in Senate legislation would help finance expanded coverage and postpone the bankruptcy of the medical program for the elderly.

The nonpartisan agency said the $246 billion it projected the legislation would save Medicare can’t both finance new programs and help pay future expenses for elderly covered under the federal program.

Nor could those savings be used to extend the solvency of Medicare, set to run out of money in 2017, the budget office said in a letter to Senate Republicans.

“What we’ve seen is a colossal manipulation” by Democrats “of the accounting scores of CBO” and the independent actuary of the Centers for Medicare and Medicaid, said Alabama Senator Jeff Sessions, the Republican who requested the analysis from CBO. He called the letter “a potential game-changer.”

The estimated Medicare savings in the legislation overstate “the improvement in the government’s fiscal position,” the CBO said in the letter.

“The true increase in the ability to pay for future Medicare benefits or other programs would be a good deal smaller,” the budget office said.

Reid Aide’s Response

A spokesman for Senate Majority Leader Harry Reid said the CBO letter doesn’t reflect on the overall health-care bill, which the Senate is set to approve tomorrow.

“Today’s letter deals explicitly with Medicare, not the overall short and long-term budgetary impact of the legislation,” Reid spokesman Jim Manley said in an e-mail.

Manley said the CBO still projects that the bill will reduce the deficit the first 10 years by $132 billion and by $650 billion to $1.3 trillion
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http://www.bloomberg.com/apps/news?pid=20601087&sid=ackCRQU57HhY&pos=9