The acronym CBO doesn’t just stand for “Congressional Budget Office.” As President Trump, Speaker Ryan and their GOP allies learned the hard way on Monday, CBO is also shorthand for “Conservative Bullshit Obliterator.”
In a day of unrelenting bad news for their would-be “replacement” bill for the Affordable Care Act, Republicans got the word from the nonpartisan budget scorekeeper that their plan would leave 14 million more Americans uninsured next year, a figure forecast to reach a staggering 24 million by 2026. Just hours after Health and Human Services (HHS) Secretary Tom Price protested that “we disagree strenuously” with CBO’s prediction, it turned out that the Trump White House’s own assessment of 26 million newly uninsured was even worse than the CBO number. Further undermining GOP talking points were the CBO conclusions that there is no Obamacare “death spiral” and that average premiums under the Republican replacement will drop over time simply because many older and sicker Americans won’t be able to afford insurance at all.
But there was seemingly a silver lining—or perhaps more fitting, a golden shower—in Trumpcare’s cloud of gloom. After years of consistently predicting that Obamacare would reduce the national debt and warning that GOP repeal efforts would inevitably increase, CBO forecast the Republican bill would save Uncle Sam $337 billion over the next decade:
CBO and JCT estimate that enacting the legislation would reduce federal deficits by $337 billion over the 2017-2026 period. That total consists of $323 billion in on-budget savings and $13 billion in off-budget savings. Outlays would be reduced by $1.2 trillion over the period, and revenues would be reduced by $0.9 trillion.
As it turns out, what Speaker Ryan trumpeted as “dramatically” reducing the deficit is a scam, too. That’s because the GOP’s “American Health Care Act” doesn’t repeal Obamacare’s Medicare savings currently projected to reach $1.1 trillion over the next decade.
Russell Berman summed up the GOP scheme in The Atlantic:
And after years of criticizing Democrats for cutting $700 billion from Medicare to pay for the Affordable Care Act, Republicans would have to defend a proposal that not only maintains those cuts but chops another $880 billion from Medicaid, according to the CBO. Those cuts offset the repeal of nearly $900 billion in tax increases on wealthy people and businesses in Obamacare.
But what ACA supporters would describe as $700 billion in payment reductions to Medicare providers Obamacare opponents called something else. Senate Majority Leader Mitch McConnell called it “sticking it to seniors.” And current House Speaker and 2012 GOP vice presidential nominee Paul Ryan branded the savings a “raid on Medicare.”
If that slander sounds sickeningly familiar, it should. Despite their nefarious uses of those same Medicare dollars saved by Obamacare, Republicans in 2010 and again in 2014 successfully ran against Democrats as supposed "Medicare killers," as this ad attests:
"By voting for ObamaCare, Democrats like Mark Pryor, Kay Hagan, Mary Landrieu and Mark Begich cut $717 billion from Medicare -- including $154 billion from Medicare Advantage -- which will hurt seniors."
In August 2012, then RNC Chairman and current Trump chief-of-staff Reince Priebus formulated the “Medicare raid” slander this way:
“This president stole...he didn't cut Medicare. He stole $700 billion from Medicare to fund ObamaCare. If any person in this entire debate has blood on their hands in regard to Medicare, it's Barack Obama.” [Emphasis mine.]
Making matters worse is that in 2016 Paul Ryan, the same Paul Ryan proposing to ration Medicare by turning into an under-funded voucher scheme, has decried the administration's "$800 billion raid of the program," which he summed up this way:
"Obamacare's plan for Medicare was to raid and ration."
As it turns out, every House GOP budget Ryan authored since 2011—all of which enjoyed 95 percent support among congressional Republicans—has continued that supposed “raid.” And in late 2015, Republicans turned that bug into a feature by touting how their Obamacare repeal would now reduce the national debt.
As you may recall, it was just over a year ago that President Obama vetoed a congressional budget that included H.R. 3762, also known as the "Restoring Americans' Healthcare Freedom Reconciliation Act." When CBO scored H.R. 3762, it told Chairman Enzi that its Obamacare "repeal" provisions would reduce deficits by $474 billion between 2016 and 2025. Conservatives were overjoyed. As shown by Hot Air's Ed Morrissey ("CBO: Obamacare repeal bill would reduce deficits by half a trillion dollars over 10 years") and The Washington Post's Jennifer Rubin ("The Congressional Budget Office has found that repealing Obamacare is a big money-saver"), right-wingers were especially excited that they can now pretend that killing the Affordable Care Act will save Uncle Sam money. In a December article titled, "Obamacare Repeal Would Cut Deficit, Boost Growth - CBO," Investor's Business Daily crowed:
A little-noticed report released Friday afternoon by the Congressional Budget Office shows that the Senate bill to repeal most of ObamaCare would cut the deficit by as much as $474 billion, while boosting GDP, investment and capital stock.
The findings stand in sharp contrast to promises by President Obama and other Democrats that ObamaCare would accelerate economic growth and lower federal deficits.
But in referring to the repeal of "most of ObamaCare," IBD skipped over what Health Affairs rightly called "the $879 billion footnote." As that magic footnote in the legislation drafted by Rep. Fred Upton (R-MI) and Sens. Orrin Hatch (R-UT) and Richard Burr (R-NC) declares:
All provisions of PPACA and HCERA are repealed except for the changes to Medicare." (Emphasis added). [Note: PPACA and HCERA are the two statutory components of the law now known as the ACA -- or Obamacare.] [Emphasis mine.]
That difference, it turns out, makes all the difference. "Saving that single element," HA explained, "turns the CBO's current deficit raising cost projection for repeal from $137 to $353 billion negative to $449 to $665 billion positive."
A critical element of the ACA's financing involves Medicare payment reductions in title 3 of the law to hospitals, insurance companies, home health agencies, and other health care providers (physician payments in Part B were unaffected) to reduce Medicare's rate of spending growth. The resulting savings help to finance the private insurance and Medicaid coverage expansions in ACA titles 1 and 2. In its first 10 years (2011-2020), CBO estimated these title 3 savings at $450 billion; in its recent June estimate, it projects the savings at $879 billion between 2016 and 2025.
The question, then, is this: What will Republicans do with that $879 billion in savings over 10 years (now estimated to be $1.1 trillion between 2018 and 2027)?
If you guessed "fund an Obamacare replacement program," you'd be wrong. Instead, those savings will go to help pay for the GOP's staggering $6 trillion tax cut. In one form or another, that Treasury draining tax cut has been in every Paul Ryan-authored House GOP budget since 2011. In 2012, Mitt Romney appropriated those same Medicare savings for his gigantic tax rate reduction. In 2016, Paul Ryan in his "Better Way" program put those same dollars toward rewards for the very rich. Donald Trump similarly promised them to the gilded class. And while there are certainly differences between Ryan's and Trump's tax plans, especially regarding their treatment of multinational corporations, The New York Times explained:
There is certainly a significant overlap. Both would cut income tax rates across the board and keep rates low on income from investments, an approach intended to spur savings that effectively guarantees the juiciest cuts for the wealthy.
An analysis of Mr. Trump's latest plan by the Tax Policy Center calculated that the top 0.1 percent of the population, those with incomes over $3.7 million in 2016, would receive an average 14 percent reduction, or about $1.1 million. Households in the middle of the scale -- those earning between about $48,000 and $83,000 today -- would get a 1.8 percent tax cut worth on average $1,010, while the poorest fifth of Americans will gain about $110, or 1 percent of their income.
Paul Ryan has been lying about his Medicare bait-and-switch for years. As Politifact explained, the ACA’s spending reductions on Medicare were “mainly aimed at insurance companies and hospitals, not beneficiaries.” But Ryan wasn’t proposing to return to higher payment for private Medicare Advantage insurers or to hospitals, clinics and doctors. As he put it in 2012:
“Well, our budget keeps that money for Medicare to extend its solvency. What Obamacare does is it takes that money from Medicare to spend on Obamacare.”
Or as Romney’s running mate put it in August 2012, “We're the ones who are not raiding Medicare to pay for Obamacare.”
Nope. Paul Ryan, Donald Trump and their Republican allies are raiding Medicare to help for their multi-trillion-dollar tax cut windfall for the wealthy. After Monday’s beat-down from the CBO, it’s no surprise Paul Ryan has gone silent about that.