A $500 billion total increase in what the government will incur is calculated thusly: The health care bill front-loads revenues and back-loads spending,Unrealistic transfers from the Medicare budget that will likely be funded from the general account when Medicare reserves are depleted (as early as 2017).Savings from eliminating the private-sector student loan program will not materialize with a new government bureaucracy that replaces private sector organizations.
The costs would be covered by Medicare budget cuts ($465B), increased taxes on the wealthy ($210B), health care and drug company industry fees ($107B), new taxes ($103B), premiums on new long-term care programs ($70B), penalties for those who refused to participate ($65B), and taxes on high-cost health care plans ($32B).
By cutting the number of uninsured (32 million people), insurance companies will be able to reduce premiums to the insured since they will no longer have to cover the hidden costs of emergency room care for the formerly uninsured.
If US GDP grows to the $22.6T level, $4.3T will be only 19% of US GDP.
To pay for the rest of government operation, the federal budget forecasts $1T deficit spending each year through the year 2020.
Since aging is also an important issue, significant attention needs to be given to growing the economy via the generation of enduring, high-value jobs. More and more baby boomers are entering retirement solely dependent on Social Security and Medicare, since many have had their retirement accounts (savings, stocks, 401Ks) and home equity wiped out in the recession.
The conclusion this chapter reaches is a grim one indeed. What is affordable to the nation as a whole today probably will not be affordable two decades from now, especially if the US economy plateaus, or retirees live longer.