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The Massachusetts “budget buster” myth

Enemies of health reform make sport of attacking “Romneycare” in Massachusetts because they know Mitt Romney’s signature achievement in public life served as a model for the Affordable Care Act.

But, as with much of the rhetoric surrounding “Obamacare”, the truth is much different than the tea party narrative of exploding costs and rationed care. To promote the truth about Romneycare, the business affiliated Massachusetts Taxpayers Foundation released a report with the scintillating title “Massachusetts Health Reform Spending, 2006-2011: An Update on the ‘Budget Buster’ Myth”. If you can’t wait to tear the cover off of this hot read then you can find the link here.

For the shorter version here’s a snippet from the executive summary:

Six years after Massachusetts enacted its groundbreaking health reform law, Chapter 58 of the Acts of 2006, more than 98 percent of the state’s residents have health insurance, access to needed care has improved, and the percentage of employers offering coverage to their workers has climbed despite the national recession.

The gains of health reform have been achieved without placing an unexpected or unmanageable burden on the state’s budget. Annual spending for programs affected by Chapter 58 grew from $1.041 billion in fiscal 2006 to $1.947 billion in fiscal 2011, an increase of approximately $906 million (Table 1). The state’s share of this spending increase is $453 million, or 50 percent of the total. While critics periodically claim that health reform has been a “budget buster,” additional state spending attributable to the health reform law accounted for only 1.4 percent of the Commonwealth’s $32 billion budget in fiscal 2011.

Health reform is working in Massachusetts. That is why legislators used Romneycare as a model for the Affordable Care Act. Obamacare is already working for many people. If it’s given a chance then nearly everyone will benefit after 2014.

10 Comments

  1. Frank Burns

    April 16, 2012 at 4:21 pm

    Somehow Obamacare must have added lots of other “stuff” in their bill compared to what Massachusetts has, as the cost is now projected to be $1.2 Trillion over the next 10 years.

  2. david esmay

    April 16, 2012 at 4:43 pm

    @Frank, link? A non-partisan one to substantiate your figures.

  3. Frank Burns

    April 16, 2012 at 7:33 pm

    More than you’ve been led to believe, reports Charles Blahous of George Mason University’s Mercatus Center. To be specific, he projects it will add $1,160 billion to net federal spending over the next ten years and at least $340 billion to federal budget deficits in that time.

    Blahous was appointed by Barack Obama as one of two public trustees of the Social Security and Medicare programs. He worked on these issues in George W. Bush’s administration and submitted his Mercatus paper for anonymous peer review.

    http://www.nationalreview.com/articles/296052/decade-obamacare-will-cost-16-trillion-michael-barone

  4. Adam Linker

    April 16, 2012 at 8:47 pm

  5. Frank Burns

    April 16, 2012 at 9:11 pm

    Adam, Secretary Sibelius admitted to the double counting. I don’t know who this guy is that you posted.

    That’s because under a 1985 internal ruling (not a full-fledged law passed by Congress), the CBO scores the costs of legislation against a hypothetical baseline rather than against current law. From my reference:

    “But, as Sebelius conceded to Congress in March 2011, that’s double counting. The government can’t spend the same money twice. Medicare tax revenues dedicated to current Medicare spending can’t be used to reduce the budget deficit. That’s true “in practice,” Medicare chief actuary Richard Foster wrote last year, despite the CBO’s scoring procedure.”

  6. AdamL

    April 16, 2012 at 9:35 pm

    Frank, if you want to take that argument seriously you have to break it into two parts. Part 1 says: I really don’t like the way the Congressional Budget Office and government agencies do their accounting, especially for programs that run from trust funds. Here’s the way I would do the accounting. Part 2 says: health reform would actually cost this much if you scrapped the way we have always done accounting and use my new method.

    This is common stuff from party hacks that want to bash the CBO. I criticize both parties equally for this practice. The way we do accounting is always fine when the numbers say what you want and the accounting rules are terrible and worthless when the numbers aren’t in your favor. Politicians of both parties are guilty of this.

    So, maybe you don’t like the way we do accounting and the way CBO scores trust fund programs. But you would need to find a new method that everyone can agree on. Then you would need to recalculate everything we do based on the new rules. This would, for example, drastically change the numbers in the Ryan budget. But there is nothing “new” to report in health reform spending. This is just someone who wants to add things differently, and who says that under his accounting, reform would be more expensive. Interesting theory to debate, but it doesn’t change anything about the costs of the Affordable Care Act.

  7. Alex

    April 16, 2012 at 10:27 pm

    I just finished watching the $ 80 Billion Healthcare Hustle detailing the fraud in Medicare and Medicaid for one year. Now we want to add another large government boondoggle- ridiculous !

  8. pearlenesilva

    April 17, 2012 at 5:54 am

    Currently, the cost of health care is rising at a much higher rate than inflation. Even if we were to implement your beloved single payer, at a certain point we can not afford to pay for every new treatment and technology that comes along if we want to have any semblance of an economy. If you dont have insurance you should check out “Penny Health” for information on how to get one.

  9. david esmay

    April 17, 2012 at 1:26 pm

    Frank you cited the findings of a Koch funded anti-think tank, as your non-partisan source, are you kidding? The CBO asserts the ACA will reduce deficits by 127 billion 2012-2021, repealing it would add 147 billion over the same period. Last month the CBO updated it’s estimates that ACA will cost 50 billion less than previous estimates. The Koch’s have vowed to spend 200 million on presidential elections to try to gain control of the WH, this misinformation and propoganda is part of it, along with their failed attempt to deny global warming.

  10. Frank Burns

    April 17, 2012 at 6:43 pm

    David, What is your problem with the Koch Brothers? They are industry leaders which is what we need in this country to provide jobs and success. The billionaire who is destructive to our way of life is George Soros and all of his funded mischief. Interesting that you don’t seem bothered by his efforts. Global warming is one of the myths that Soros is pushing but the evidence is not there, it’s just not happening. The sea level is not rising, the polar bears are increasing, the temperatures have been flat for 15 years, the ice levels are increasing, so where’s the beef?