Sen. Lamar Alexander (R-Tenn.) said President Obama's healthcare law would increase the federal debt by $131 billion. "Instead of insulting the intelligence of Tennesseans by saying this law is working, this administration should admit ObamaCare is a failure and start working with Republicans to repair the damage it has done -- putting in place policies that move us step by step toward more freedom, more choices, and lower costs," Alexander said Tuesday. Alexander cited a new report from Senate Budget Committee ranking member Jeff Sessions (R-Ala.) that stated the Affordable Care Act, also known as ObamaCare, would increase the federal deficit by approximately $131 billion by 2024.
First, they produced an estimate of savings from the health reform provisions that reduce Medicare and other program costs that's significantly lower than CBO's. They did so by assuming that health reform had nothing whatsoever to do with the substantial slowdown in health care cost growth in the past few years.... Even under the conservative assumption that health reform accounts for only a small part of the slowdown in health care costs, it would more than offset the Senate Republicans' reduction in health reform's estimated Medicare savings. Second, the Senate Republican analysis overstates the budgetary impact of changes in labor supply (that is, the total hours of work that workers choose to supply) under health reform. CBO estimates that health reform will cause a small reduction in the labor supply, in significant part because some people who now work mainly to obtain health insurance -- a situation known as "job lock" -- will choose to retire earlier or work somewhat less; that reduction will shrink total labor compensation by roughly 1 percent from 2017 through 2024, according to CBO. The Senate Republican analysis assumes that the overall amount of income subject to tax will drop by the same percentage. But wages and salaries, in fact, represent only about 70 percent of adjusted gross income, which also includes interest, dividends, rental income, capital gains, and some retirement distributions. Thus, a 1-percent cut in labor compensation would shrink tax revenues by much less than 1 percent.