Most of the $115 billion in newly reported discretionary spending represents existing healthcare reform spending, CBO clarifies

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Peter Orszag
Peter Orszag

The Congressional Budget Office on Wednesday released clarification of its analysis showing that $115 billion in discretionary spending will result from the healthcare reform law. Most of that spending is for existing programs, according to the CBO.

The initial report was met with criticism from many who were upset that the $115 billion in spending authorizations had not been included in the original price tag for the healthcare reform package. Hoping to allay those concerns, CBO director Peter Orszag clarified some points on the White House blog.

Approximately $86 billion of the $115 billion in authorizations are actually new authorizations of spending that already exists—not new spending, according to Orszag. Also, any new spending will be subject to a three-year freeze on non-security discretionary spending, meaning offsets will have to be made should Congress decide to approve the spending. Spending authorizations do not necessarily compel Congress to spend money; they simply represent what Congress would like to spend money on, Orszag explained. Many authorizations are either not fully funded, or never actually receive funding.

“The bottom line remains the same,” Orszag stated. “The Affordable Care Act is the largest deficit reduction package enacted in over a decade according to CBO. It will reduce deficits by more than $100 billion in the current decade and more than $1 trillion in the decade after that and that will not change.”