* Report says overhaul would raise health spending
* Raises doubts about cost savings in Senate bill
By Donna Smith
WASHINGTON, Dec 11 U.S. healthcare spending
would rise by about $234 billion over the next decade under the
Senate Democrats' overhaul bill and some of the proposed
savings might never be achieved, a U.S. agency said in a report
released on Friday.
It was the latest in a series of reports issued by the
agency that oversees Medicare that cast doubt on some of the
savings claims made by Democrats about one of President Barack
Obama's top domestic priorities.
Republican opponents on Friday seized on the report to
underscore their message the sweeping healthcare reform will
raise costs and hurt Medicare benefits.
"This report confirms what we've long known -- the Democrat
plan will increase costs, raise premiums, and slash Medicare,"
said Republican Leader Mitch McConnell. "That's not reform.
This analysis speaks for itself. This bill is a sham."
But Democrats said many of the potential cost savings in
the bill were hard to estimate and that the bill would extend
the financial life of the Medicare health program for the
elderly and result in lower premiums and out-of-pocket
"The report shows that health reform will ensure both the
federal government and the American people spend less on health
care than if this bill doesn't pass, helping get a hold of
America's debt and keep more money in people's pockets," said
Senate Finance Committee Chairman Max Baucus, who helped write
The report, written by Richard Foster, the chief actuary at
the Centers for Medicare and Medicaid Services, said the
increase in healthcare spending reflected the impact of
millions of newly covered people seeking medical care.
"Although several provisions would help to reduce
healthcare cost growth, their impact would be more than offset
through 2019 by the higher health expenditures resulting from
the coverage expansions," the report said.
Foster acknowledged his analysis of the sweeping reform had
a "greater degree of uncertainty than is usually the case with
more routine health care proposals."
SOME COST-SAVING PROPOSALS 'MAY BE UNREALISTIC'
The healthcare revamp seeks to rein in soaring costs and
provide medical coverage to millions of uninsured people. The
report said about 57 million people would be without health
insurance in 2019 under current laws. The number would be
reduced by 24 million if the Senate bill is enacted, it said.
The report, similar to one issued by the agency on the
healthcare bill passed by the House of Representatives in
November, went on to say the added demand for health services
at first may be difficult to meet and could lead to price
increases and a reluctance by providers to treat patients with
low-reimbursement health coverage.
Medicare has significantly lower reimbursement rates than
private insurers. Doctors, clinics and hospitals that rely
heavily on Medicare patients for business "could find it
difficult to remain profitable and, absent legislative
intervention, might end their participation in the program,"
the report said.
Congress would probably find that politically unacceptable
and the report concluded some of the Medicare cost saving
proposals "may be unrealistic."
Democrats argued the $2.5 trillion U.S. healthcare system
is fraught with wasteful spending and the savings from wellness
programs and payment system reforms that would reward quality
rather than quantity of treatments and services would be
greater than estimated.
"There is a very significant cost savings target that can
be achieved," Democratic Senator Sheldon Whitehouse said in a
telephone conference with reporters.
"You could get a number down if you just went in and cut
benefits," he said. "The problem (in the system) is not that
benefits are too high, the problem is that it is managed
poorly, it has enormous waste and duplication and error and
resolving those things are just plain harder to cost by its
(Reporting by Donna Smith; Editing by Peter Cooney)