Here’s an easy way to make the big healthcare overhaul “budget neutral” as politicians keep (stupidly) promising: just shift more costs to the states. Voila, done.
NYT notes that governors are getting nervous about changes in Medicaid rules, that would put more obligations directly on cash-strapped states.
This actually seems pretty silly from an economic reason. That won’t represent any net lower costs for taxpayers (which is what matters) and in fact it will probably cost taxpayers more money, given the states higher cost of capital.
Politicians should just drop the budget neutral part, because nobody could possibly ever believe it, not even the CBO. Insteady, Obama and the Democrats should just come out and say it: Yes it will cost more, but it will be better, and we’ll include everone, and so the cost is worth it.
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