Baucus bill offers some magical cost savings

The Senate Finance Committee will perpetrate a huge fraud on the US public today. Chairman Max Baucus promises to hold a final vote on his health-care overhaul -- most of whose costs he has hidden with budgetary gimmicks.

The widely reported numbers are wrong: This bill would increase the deficit and cost more than $2 trillion over 10 years.

Yes, the headlines on the Congressional Budget Office's preliminary cost estimate were that the bill could cost $829 billion over 10 years and trim the federal deficit by $81 billion. But those numbers are pure fantasy -- as CBO plainly, if gently, indicated.

First off, Baucus relies on some cuts that we know won't actually get made.

Long ago, Congress enacted a series of annual cuts to Medicare physician payments that were supposed to begin in 2003. Starting that very year, however, Congress has repeatedly blocked those cuts.

Yet Baucus -- contrary to all experience -- assumes Congress will let those cuts take place starting in 2012. That implausible assumption creates some $234 billion in "savings" that will never materialize. Factor them out, and the supposed $81 billion in deficit reduction becomes $153 billion in fresh deficit spending.

The CBO's language pooh-poohing Baucus on this was pure bureaucratese -- but the agency essentially told Baucus: If the sun rises in the west from 2012 through 2019, then yes, this bill would reduce the deficit.

That's not all. What the Baucus bill does is pass a lot of costs on to the private sector - which, of course, will eventually be passed on to consumers. How large a cost?

The Massachusetts Taxpayers Foundation found that new federal and state spending accounts for just 40 percent of the Bay State's reforms' cost -- and the private-sector mandates for 60 percent. Apply that ratio to the Baucus bill, and its actual cost exceeds $2 trillion.