August 13, 2003

August 13, 2003 | WebMemo on Health Care

Medicare Malady #22: Dude, Where's My $400 Billion?

That estimate of Medicare "reform" proposals pending before Congress is gone, man.

 

But there are new figures -- and they're even higher.

 

Here's how: On June 27, the House and Senate approved separate proposals that would add prescription drugs to Medicare as an entitlement. The bills' sponsors said it would cost $400 billion over the next 10 years. 

 

But on July 22, the Congressional Budget Office offered a different estimate. It said the Senate drug provisions would cost $432 billion from 2004-2013. The House's drug provisions would be $425 billion in the same period.

 

This isn't a slight discrepancy, notes Heritage Foundation health-care expert Derek Hunter in an Aug. 12 paper. In less than a month, the government changed how much these Medicare bills will cost you, the taxpayer, by as much as $32 billion.

 

Maybe more: Heritage experts have found that these bills, which are being hammered into one by a Capitol Hill committee, could cost taxpayers $2 trillion by 2030. That's 12 zeros, folks. To put it another way, households would pay $3,980 in 2030 in taxes just for Medicare. 

 

No one knows what the final costs of these Medicare bills will be, Hunter writes. But one thing is clear: "Over time, the costs of administration and congressional proposals to add a Medicare prescription entitlement have all gone in one direction: up."

 

Read more of Hunter's paper and other Heritage Medicare research at heritage.org.

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