The Congressional Budget Office (CBO) may be unfamiliar to many Americans, but inside the Beltway, its fiscal forecasts are often taken as gospel. Unfortunately, CBO’s prophecies have sometimes been spectacularly wrong when it comes to trying to predict how federal health policy will shake out. The latest study from the National Taxpayers Union Foundation is yet another example: CBO has been using fuzzy math to understate the cost of Medicare by as much as $45 billion.
In relation to the Center for Medicare and Medicaid Innovation (CMMI), CBO is simply assuming savings where there may not be any. CMMI was created by the Affordable Care Act to experiment with “payment and service delivery models to reduce program expenditures.” It was given a massive $10 billion infusion of taxpayer cash (not subject to annual Congressional appropriations) to create “demonstration projects” that would supposedly revolutionize the way Medicare and Medicaid spent money.
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