Michael Tanner

In the weeks since the Supreme Court upheld the constitutionality of the Patient Protection and Affordable Care Act, the evidence has continued to pile up that, constitutional or not, ObamaCare is bad news.

Yes, fans of the "reform" cheered this week's news reports suggesting that ObamaCare will be less expensive than originally feared. But those news reports were wrong.

The Congressional Budget Office did, in fact, report that two provisions, the expansion of Medicaid and subsidies to help middle-class families buy insurance, might cost $84 billion less over the next 10 years than previously projected. But that's a drop of less than 5 percent of the law's total cost over that period.

Plus, it's a "savings" only in the Washington sense that, instead of spending $1.76 trillion on those subsidies, now we're only going to spend $1.68 trillion.

ObamaCare will cost more and insure fewer people.

And the reason for this cost reduction isn't that Uncle Sam has found some new way to provide insurance less expensively — it's that the government is going to cover 3 million fewer people.

In particular, CBO notes that the Supreme Court made the law's Medicaid expansion optional for states, and at least seven governors have already announced that they'll pass. Some of the people who would've gotten Medicaid in those states may qualify for other federal subsidies instead, but not all. So the feds will spend less money providing coverage.

In other words, it'll cost less by covering fewer people. But that's not the end of the CBO report: It also showed that costs for the rest of the program, and for the law as a whole, are still rising.

For projected ObamaCare spending from 2012 to 2021, CBO estimates are now $81 billion higher than they were a year ago. (The big change: CBO now concludes that many of the law's expected savings in Medicare and elsewhere won't happen.)

So: We're going to cover fewer people — and pay more than we'd thought, anyway. That's nothing to cheer about.


Michael Tanner

Michael D. Tanner is a senior fellow at the Cato Institute, heading research into a variety of domestic policies with particular emphasis on health care reform, welfare policy, and Social Security. His most recent white paper, "Bad Medicine: A Guide to the Real Costs and Consequences of the New Health Care Law," provides a detailed examination of the Patient Protection and Affordable Care Act (Obamacare) and what it means to taxpayers, workers, physicians, and patients.

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