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Obama Administration actuary concludes that Reid bill will lead to skyrocketing healthcare costs

Center for Medicare and Medicaid Services (CMS) Chief Actuary Rick Foster recently released a report that analyzes the latest version of Senate Majority Leader Harry Reid's (D-Nev.) healthcare takeover bill.  Among other things, the analysis found that under Reid's bill healthcare costs will rise, seniors may lose access to care, and millions of Americans may be forced off of their current insurance plans.  Foster's report shows

Reform will bend the cost curve up:  The report finds that America will spend $234 billion more under the Reid bill than it would without it. 

Currently, national health expenditures are 16 percent of GDP.  Under the Reid bill, that percentage will increase to 20.9 percent of GDP.  This means that more than 1 out of every 5 dollars spent will be spent on healthcare.

Reform “jeopardizes access to care” for senior citizens:  With nearly half a trillion dollars in cuts to the Medicare program, the CMS finds that “providers for whom Medicare constitutes a substantive portion of their business could find it difficult to remain profitable and might end their participation in the program.” 

If doctors stop providing care to Medicare patients, some seniors may lose access to care.
Reform savings are “unrealistic”:  Mr. Foster states that the Medicare cuts include in the Reid bill are “unrelated to the providers’ costs of furnishing services to beneficiaries” and that it is “doubtful” that providers could reduce costs to keep up with the cuts.
Reform will cost consumers $11 billion more per year: The Reid bill includes new taxes that will increase the prices of drugs and medical devices as well as raise health insurance premium for consumers.  These new taxes are estimated to increase costs on consumers by $11 billion per year beginning in 2011.
Health care shortages are “plausible and even probable”: The Chief Actuary predicts that because of an increased demand for health care, access to care problems are “plausible and even probable."  The access problems will be the worst for seniors on Medicare and low-income people on Medicaid.  Foster says, “providers might tend to accept more patients who have private insurance and fewer Medicare or Medicaid patients, exacerbating existing access problems for the latter group.”
The "public option" will be more expensive than private insurance:  Agreeing with the Congressional Budget Office's (CBO) statement that the public option will "typically have premiums that [are] somewhat higher than the average premiums for the private plans in the exchanges," the Chief Actuary estimates that premiums for the government-run plan will be four percent higher than for private insurers.  
Millions of Americans will lose the coverage that they currently enjoy: Again agreeing with the CBO, Foster predicts that 17 million people will lose their employer-sponsored health insurance.  Employers will be “inclined to terminate their existing coverage” so their workers can qualify for “heavily subsidized coverage” through the exchange.

 Since the report was released, Majority Leader Reid's bill has gained further criticism from those on the right as well as on the left.

In response to the CMS report, Senator John Cornyn (R-Tx.) stated:

Democrats have refused to believe me and my colleagues when we told them that the monstrous 2,074 page, $2.5 trillion Reid health care bill would increase premiums, raise taxes and cut Medicare.... The repeated calls in opposition from the American people have fallen on Democrats’ deaf ears.  Now, we have President Obama’s own independent actuary not only confirming these findings, but also concluding that the Reid bill would actually drive up this country’s unsustainable level of health care spending.

Senator Bernie Sanders (I-Vt.)-- who caucuses with the Democrats-- furthered this sentiment stating:

Can I sit up here or stand here with a straight face and say, "We have got strong cost-containment provisions in this legislation?" That "if you're an ordinary person who has employer-based health care, that your premiums are not going to go up in the next eight years based on what’s in this bill?" I can't say that. It’s just not accurate.

A bill that raises the cost of healthcare, limits access and affordability, and causes millions of Americans to lose the coverage that they currently enjoy is not the solution to America's healthcare troubles.  The American people deserve real reforms that lower costs and make insurance more accessible. 

If President Obama's own CMS Chief Actuary is coming out with such gloomy predictions, how bad will the actual legislation will be?