Sebelius: Yes, we’re double-counting Medicare savings

posted at 2:15 pm on March 4, 2011 by Ed Morrissey

Rep. John Shimkus (R-IL) pins down HHS Secretary Kathleen Sebelius on one of the most controversial budget tricks in ObamaCare — the $500 billion cut in Medicare that supposedly goes for both cost control and to fund other parts of the program.  Medicare’s own actuary blew the whistle on this sleight of hand in August of last year, which makes this admission by Sebelius a no-brainer:

In her first appearance before the House Energy and Commerce Health Subcommittee since the health-care law passed, Kathleen Sebelius responded to a line of questioning by Republican Rep. John Shimkus of Illinois about whether $500 billion in Medicare cuts were used to sustain the program or pay for the law.

“There is an issue here on the budget because your own actuary has said you can’t double-count,” said Shimkus. “You can’t count — they’re attacking Medicare on the CR when their bill, your law, cut $500 billion from Medicare.”

He continued: “Then you’re also using the same $500 billion to what? Say your funding health care. Your own actuary says you can’t do both. […] What’s the $500 billion in cuts for? Preserving Medicare or funding the health-care law?

Sebelius’ reply? “Both.”

The actuary’s report made this crystal clear last summer:

Bad though all of this is, none of it is actually the worst gimmick in the official report’s advertised improvement in Medicare solvency. That involves the double-counting of Medicare savings. Earlier this year, Congress passed a health care bill containing various new Medicare taxes and constraints on program expenditures. Such savings are assumed in the official report to extend the solvency of Medicare. But Congress chose instead to spend the savings on a new health care entitlement.

The Medicare actuary wrote a memorandum on April 22 of this year calling attention to this “double-counting.” “In practice,” he stated, “the improved Part A financing cannot simultaneously be used to finance other Federal outlays (such as the coverage expansions under the PPACA) and to extend the trust fund, despite the appearance of this result from the respective accounting conventions.”

In other words, money can only be used once. Since the Medicare savings is being spent elsewhere on expanded health care coverage, it is not really being employed to extend Medicare solvency. To claim an improvement in Medicare financing is to mislead about the effects of recent legislation.

Even apart from the double counting, the actuary had little faith in ObamaCare’s ability to deliver the savings claimed by Sebelius in this clip, also noted last summer:

“(T)he financial projections shown in this report for Medicare do not represent a reasonable expectation for actual program operations in either the short range. . . or the long range. . . . I encourage readers to review the ‘illustrative alternative’ projections that are based on more sustainable assumptions for physician and other Medicare price updates.”

These remarkable words are found, in all places, in the “Statement of Actuarial Opinion” in the back of the 2010 annual Medicare Trustees’ Report.

It is difficult to overstate how unusual this development is. The normal process with the annual Trustees’ Reports is for the Trustees to develop and publish the best available projections for the future finances of Social Security and Medicare. The respective Social Security and Medicare actuaries then sign a pro forma blessing of those projections, which is tacked to the back of the report when released to the public.

This year, the Medicare Chief Actuary clearly did not feel he could in good conscience sign such a declaration.

The admission here should prompt the House to demand a new financial accounting of ObamaCare from the CBO in the context of current data, rather than with the rosy scenarios painted by Democrats that ignored both the “doc fix” they later pushed through Congress and the results of this double-counting.


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It is not news that the Obama administration lies and contorts figures of all types. This is of a piece with today’s rigged employment figures.

GaltBlvnAtty on March 4, 2011 at 2:18 PM

The admission here should prompt the House to demand a new financial accounting of ObamaCare from the CBO in the context of current data, rather than with the rosy scenarios painted by Democrats that ignored both the “doc fix” they later pushed through Congress and the results of this double-counting.

Excellent idea!

ladyingray on March 4, 2011 at 2:19 PM

So I can send in half my tax payment, and you can count it as double, right?

portlandon on March 4, 2011 at 2:22 PM

Somehow, I think she was hoping Biden would have been there to answer that one. He would have been a little more convincing.

singlemalt 18 on March 4, 2011 at 2:22 PM

More numbers from the “database in their lower intestines.

hoosiermama on March 4, 2011 at 2:22 PM

Uh-oh. I think she told the truth.

DuctTapeMyBrain on March 4, 2011 at 2:23 PM

She’s a nasty lady and looked a bit testy on hving to give it up. Dude might want to add some deadbolts in his home. Never know where or how the BATF will strike next.

a capella on March 4, 2011 at 2:23 PM

Let the oversight begin.

First shot: “Yes, we fudged the numbers. And it worked. A lot of Americans still believe ObamaCare is a good thing. Buncha rubes. I pity you conservatives. Your base is much more educated and informed on current events. That makes your campaigns and voting much harder. For us, we can say any damn thing we want, and our base eats it up.”

BobMbx on March 4, 2011 at 2:23 PM

Enron executives and Bernie Madoff wonder why they are in jail.

rbj on March 4, 2011 at 2:23 PM

that’s cool. I’m double counting my tax contributions this year. Maybe next year too.

ted c on March 4, 2011 at 2:24 PM

She’s a nasty lady and looked a bit testy on hving to give it up. Dude might want to add some deadbolts in his home. Never know where or how the BATF will strike next.

a capella on March 4, 2011 at 2:23 PM

Her position on dissent concerning the coming Unicorn invasion is already on the public record: Not gonna be tolerated.

BobMbx on March 4, 2011 at 2:24 PM

So I can send in half my tax payment, and you can count it as double, right?

portlandon on March 4, 2011 at 2:22 PM

Actually, I think this means they can take your tax refund, and instead of the IRS sending it to you they will send it to fund another agency.

strictnein on March 4, 2011 at 2:25 PM

Just stretching those imaginary dollars until the fed prints them up to devalue the ones you already have…

ajacksonian on March 4, 2011 at 2:25 PM

Democrat math. It’s how we got here!

xrayiiis on March 4, 2011 at 2:27 PM

The face tightening/clenching on Sebellius at the last second, right after her statement “Both” is very telling.

aquaviva on March 4, 2011 at 2:27 PM

Color me shocked!!

NJ Red on March 4, 2011 at 2:28 PM

Why would one be surprised by this? bho and team have never, since the election, ever told the truth about anything. They use the fuzzy math daily. See the job numbers today for example! In a month or so, it will be revised to be worse. Any one of bho’s opens their mouth, lies come out. This time, the truth happened to be said by sebelius.
L

letget on March 4, 2011 at 2:29 PM

So Madam Secretary, to whom ObamaCare gives sole discretion on imposing rules on who pays what for which medical treatment, just admitted she’s double-counting HALF A TRILLION dollars!

Robbing Peter to pay Paul HALF A TRILLION DOLLARS.

Or in this case, letting Grandma stay sick to pay for Junior’s health insurance he doesn’t want.

How do you parlay half a trillion dollars into a whole trillion? Never been done in private business, but it’s easy when you work for Obama. Just say “both”. Magic !!!

Steve Z on March 4, 2011 at 2:30 PM

How in the HELL was she not dragged out of there in chains??? A public official admits lying to the American public and she goes free? What the HELL!!!

fossten on March 4, 2011 at 2:31 PM

The magic of numbers. Global warming, economics, budgets, science, polls, all numbers.

When I was a kid there was a guy at the county fair that had an IBM punch card shorting machine. He could do hand writing analysis with it, for a quarter.

Skandia Recluse on March 4, 2011 at 2:31 PM

shorting…uh. sorting…do I hafta look it up. It was SCIENCE, man, made by IBM, ya know?

Skandia Recluse on March 4, 2011 at 2:32 PM

Knucklehead on March 4, 2011 at 2:29 PM

Oh my God, these SOBs need to be hung by their short hairs on the Mall in Washington.

NJ Red on March 4, 2011 at 2:33 PM

The admission here should prompt the House to demand a new financial accounting of ObamaCare from the CBO in the context of current data, rather than with the rosy scenarios painted by Democrats that ignored both the “doc fix” they later pushed through Congress and the results of this double-counting.

Media comphy in O’s ars. Suffocate in there, derelicts of duty!

Sebelius reminds one of Nurse Ratched.

Schadenfreude on March 4, 2011 at 2:34 PM

Knucklehead on March 4, 2011 at 2:29 PM

Hmmm.

“This is a case of legislative fraud of the highest order. We now know that the ObamaCare bill contained advanced appropriations for use in implementing this massive government takeover of health care. This year alone, the provisions are already in place to spend $5 billion on ObamaCare, and another $100 billion will be spent over the next eight years, even without any appropriating actions by Congress.

a capella on March 4, 2011 at 2:34 PM

Sebelius is the epitome of liberal incompetence. You average her and Barbara Boxer’s IQs and you they would still begin with a decimel point.

volsense on March 4, 2011 at 2:35 PM

Kinda b!tch you wouldn’t want to be married to.

She knows how to spend other peoples money.

nimrod on March 4, 2011 at 2:35 PM

Jail time.

And take your friends with you.

journeyintothewhirlwind on March 4, 2011 at 2:36 PM

Knucklehead on March 4, 2011 at 2:29 PM

We’ve been covering that for weeks:

Interview with Steve King

New budget still has ObamaCare funding mechanisms in place

Ed Morrissey on March 4, 2011 at 2:39 PM

Since we know that ObamaCare was going to save us $130B over 10 years and how it was passed through reconciliation in the Senate, can the Republicans try to pass the repeal of ObamaCare through these channels? This would have never passed the reconciliation requirements if Americans knew it would create a $370B deficit to begin with.

djaymick on March 4, 2011 at 2:39 PM

Uh-oh. I think she told the truth.

DuctTapeMyBrain on March 4, 2011 at 2:23 PM

Yes, she did. Finally.

It sounds like, at this point, all of 0bama’s henchmen are just trying not to perjure themselves and end up in prison.

UltimateBob on March 4, 2011 at 2:40 PM

We’ve been covering that for weeks:

Interview with Steve King

New budget still has ObamaCare funding mechanisms in place

Ed Morrissey on March 4, 2011 at 2:39 PM

Duh! Those were the two weeks I was sailing thru the Panama Canal and was absent. Sorry.

Knucklehead on March 4, 2011 at 2:41 PM

Did you see the blonde aide behind Shimkus who laughed when Sebelius said, “Both”?

This may have been a no-brainer, but it’s something to see someone out of this administration actually have to admit what went on.

$500 billion is not $50, it’s not even $5,000. That’s an incredible amount of money with which to do this kind of chicanery.

Enron executives and Bernie Madoff wonder why they are in jail.

rbj on March 4, 2011 at 2:23 PM

You bet.

INC on March 4, 2011 at 2:42 PM

This has been well known for a while now. Paul Ryan even pointed this out to Obama himself face-to-face at that health care summit a year ago. And Obama didn’t respond. He just glared at Ryan for 5 minutes and moved onto the next Democrat who was scheduled to speak.

Doughboy on March 4, 2011 at 2:42 PM

David Blaine wishes he had those sleight-of-hand skills.

SKYFOX on March 4, 2011 at 2:43 PM

Cruella DeVille is not the sharpest knife in the drawer…

d1carter on March 4, 2011 at 2:45 PM

Duh! Those were the two weeks I was sailing thru the Panama Canal and was absent. Sorry.

Knucklehead on March 4, 2011 at 2:41 PM

Now I’m totally jealous ….

Ed Morrissey on March 4, 2011 at 2:45 PM

The admission here should prompt the House to demand a new financial accounting of ObamaCare from the CBO in the context of current data, rather than with the rosy scenarios painted by Democrats that ignored both the “doc fix” they later pushed through Congress and the results of this double-counting.

So what are the ramifications for the law in light of the fact that the Dems apparently used the budget reconciliation process inappropriately to pass the legislation?

Machiavelli on March 4, 2011 at 2:46 PM

Did you see the blonde aide behind Shimkus who laughed when Sebelius said, “Both”?

INC on March 4, 2011 at 2:42 PM

Darn you people with high speed internet. I’m stuck here at work, behind firewalls, with several layers of internet security and an encrypted hard drive. It would take an hour to download this video on this system, which is the equivalent of a 286 with dial-up internet.

I’ll have to watch it when I get home later.

UltimateBob on March 4, 2011 at 2:49 PM

So what are the ramifications for the law in light of the fact that the Dems apparently used the budget reconciliation process inappropriately to pass the legislation?

Machiavelli on March 4, 2011 at 2:46 PM

In a rational world, it would impact the argument of constitutionality in a negative fashion.

Vashta.Nerada on March 4, 2011 at 2:51 PM

Now I’m totally jealous ….

Ed Morrissey on March 4, 2011 at 2:45 PM

Tahiti and Hawaii on the 16th. Eat your heart out!

……I’m spending it before Kathleen Sebelius takes it away from me.

Knucklehead on March 4, 2011 at 2:52 PM

That’s how Barry became the smartest guy eveerrrr!
IQ of 86 x 2 = 237 + 57 states, plus the 2 he hasn’t been to yet, and the 1 he’s not going to, divided by the real unemployment rate, times the national debt…
-

RalphyBoy on March 4, 2011 at 2:53 PM

I’ll have to watch it when I get home later.

UltimateBob on March 4, 2011 at 2:49 PM

It’s a short clip, but worth viewing to see the facial reactions.

INC on March 4, 2011 at 2:54 PM

Open Letter To IRS:
Dear Sir or Madam

Where is the 2nd half of my 2010 Federal tax refund?

alwyr on March 4, 2011 at 2:57 PM

Shimkus. Awesome name.

Obamacare is one big pile of shimkus.

miConsevative on March 4, 2011 at 2:58 PM

The taxes I paid this year area also my payment for next year.

hawksruleva on March 4, 2011 at 3:01 PM

She is just so darned smart!

Tim_CA on March 4, 2011 at 3:05 PM

Lies, lies and more lies.

Kini on March 4, 2011 at 3:05 PM

So, one of the Nazgul got smacked around by the Fellowship of the GOP.

Rove to Shimkus: “You should be more careful…I know what hunts you”

BobMbx on March 4, 2011 at 3:11 PM

You can tell Sebeluis is seething with hatred every time she speaks. Beauty is only skin deep – but ugly goes straight to the bone.

DeweyWins on March 4, 2011 at 3:13 PM

P A N T S

O N

F I R E !

hillbillyjim on March 4, 2011 at 3:20 PM

Sebelius’ reply? “Both.”

Hey, we lied…so what’s your point. And better yet, what do you think you can do about it?

BigWyo on March 4, 2011 at 3:24 PM

The fact that she convincingly said “both” is an admission that she and the admin. KNOW they are lying!

rjoco1 on March 4, 2011 at 3:26 PM

Is it me or does she look like a flight risk?

onomo on March 4, 2011 at 3:29 PM

I’m pretty sure Paul Ryan brought this very thing up in that round table debate they had before they passed this POS.

President PantLoad just sat there and stared daggers at him.

And here we are a year later and they finally get one of the thieving ba$tards to come out and admit it???

Good effort.

BigWyo on March 4, 2011 at 3:29 PM

Debating Obamacare for almost a year but then passing a massive bill that no one had the time to read…

What could possibly go wrong?

visions on March 4, 2011 at 3:29 PM

Inconvenient arithmetic is so racist!

Roy Rogers on March 4, 2011 at 3:30 PM

Wow, you could read sebe’s eyes when she said “both”. Talk about a non-verbal FU and then the quick look away….
Shimkus was trying sooooooo hard not to call her a lieing byatch too. Awesome Friday afternoon “caught you in a lie….again” porn….Thanks Ed! :-)

sicoit on March 4, 2011 at 3:31 PM

Not only is Sebelius deceitful, she is nasty.

“The Secretary shall…” Indeed!

onlineanalyst on March 4, 2011 at 3:35 PM

And this is the moron who the health care law has given more power to than any other individual or agency.

ButterflyDragon on March 4, 2011 at 3:37 PM

She is flat out lying, on record.

The entire question was based on the fact ” Medicare actuarial scientists said you can’t do both”

Her answer “Both”

ITS IMPOSSIBLE TO COUNT BOTH.

Odie1941 on March 4, 2011 at 3:38 PM

Sebelius lied?

Hey, sorry, but take a look at the budget problems here in Kansas that parallel those of the Feds. Thanks in no small part to Sebelius’ recent term as Governor here.

During her term we had extensive budget increases to education and government social programs without any realistic means of paying for it, other than “expected” tax revenues based on nothing more than optomistic hope. Since past tax revenues reflected no such ability, hope is about all the future had to hold. And tax revenue didn’t go up as hoped, but we’ve certainly got the budget deficit.

This health care issue is similar in nature, except it will be 50 times worse once it hits all 50 states, and will impact the entire nation much like Sebelius’ policies have here in Kansas.

Lawrence on March 4, 2011 at 3:40 PM

“The second set of books, a work of ART!”

mojo on March 4, 2011 at 3:41 PM

Let’s run a half dozen more of these department heads through a series of televised and under oath committee sessions. Most will continue to lie but we should catch a couple more like this disgusting excuse for an American. Why don’t we do something about it when an admission like this is plain and simple. This is lying, cheating and subject to the law and purjury. She would look great in an orange jumpsuit.

highninside on March 4, 2011 at 3:44 PM

Yet another lie?????????

I’m shocked!!! NOT!!!!!!!!!

capejasmine on March 4, 2011 at 4:00 PM

Isn’t it telling that none of the resident trolls/floating turds never show up on this kind of thread to attempt any kind of defense for the indefensible? Shows just how intellectually bankrupt the left is.

arnold ziffel on March 4, 2011 at 4:05 PM

Why the CBO? I don’t trust them anymore. Hire a PRIVATE FIRM to run the numbers!

parteagirl on March 4, 2011 at 4:10 PM

She should have told the truth:

We want ObamaCare to fail. That way we can move right into government run health care. It’s what we’ve wanted all along.”

GarandFan on March 4, 2011 at 4:18 PM

GaltBlvnAtty on March 4, 2011 at 2:18 PM

That’s what socialist do They use state run media and pump out endless propaganda.

Meanwhile reality continues to spiral down into the abyss.

They are wretches.

dogsoldier on March 4, 2011 at 4:20 PM

Double counting?

In the corporate world that’ll get you nailed by the feds.

coldwarrior on March 4, 2011 at 4:43 PM

Voodoo Healthcare costs, apparently.

Old Fritz on March 4, 2011 at 4:54 PM

Neal Cavuto just covered this from 4:50 to 4:55 tonite on the FoxNews Channel. He might go into this more during his 6 pm show on the Fox Business Channel. Not sure, but this is going to become a big issue. Watch the main stream press bury it, just like they have buried the fact that the health care bill already appropriated 105 BILLION to setup obamacare, and unless specific action is taken, this money will be spent and out of the control of this congress and future congress sessions.

karenhasfreedom on March 4, 2011 at 4:56 PM

Put her in jail with Spike.

Hummer53 on March 4, 2011 at 5:04 PM

The admission here should prompt the House to demand a new financial accounting of ObamaCare from the CBO in the context of current data, rather than with the rosy scenarios painted by Democrats that ignored both the “doc fix” they later pushed through Congress and the results of this double-counting.

Rep. Paul Ryan has been beating that drum for some time but the Obama Admin. doesn’t give a damn. This is their holy grail and they’re not giving it up, fiscal realities be damned.

Yakko77 on March 4, 2011 at 8:26 PM