The right is currently atwitter about a large discrepancy between the numbers in the White House FY2012 budget and its recently released FY2013 budget:
A powerful House Republican wants the Obama administration to explain why it’s asking for an extra $111 billion to implement part of the healthcare reform law.
Ways and Means Committee Chairman Dave Camp (R-Mich.) is asking about a spike in the estimated costs of subsidies to help people buy private insurance — a central, and expensive, component of the new healthcare law.
The administration’s budget request this year included $111 billion more for subsidies than its request last year. The difference falls across the same seven-year window.
What they're talking about is the "Refundable Premium Assistance Tax Credits" line of this table from the White House's FY2013 budget. The exact same line in the analogous table from the White House's FY2012 budget a year ago had some very different numbers. I've pulled out the numbers in the table below for ease of comparison.
Table 1: Refundable Premium Assistance Tax Credits, White House's FY12 Budget vs FY13 Budget (in millions)
| Year | FY12 Budget | FY13 Budget |
| 2014 | 15,585 | 21,553 |
| 2015 | 32,023 | 43,262 |
| 2016 | 42,645 | 55,903 |
| 2017 | 48,201 | 61,830 |
| 2018 | 51,615 | 65,723 |
| 2019 | 55,123 | 70,661 |
| 2020 | 58,809 | 76,339 |
| 2021 | 62,698 | 82,563 |
| Total, 2014-2021 | 366,699 | 477,834 |
The difference between the $477,834,000,000 they projected spending over the 2014-2021 time period and the $366,6999,000,000 they projected spending over the same time period last year is $111,135,000,000. That's the $111 billion discrepancy the right is talking about.
But are we really now going to be spending over $100 billion more for the people in the exchanges than we thought all along? Before answering that, we need to factor in one more source of spending on folks who will be enrolled in exchanges: cost sharing subsidies.
Not only do low-to-middle income people get tax credits to help them pay their premiums, they are also eligible for additional subsidies to help them pay some of the costs of their deductibles and coinsurance. Projections for spending on these subsidies (shown in the table below) didn't change much between the White House's budget last year and its budget this year.
Table 2: Cost Sharing Subsidies, White House's FY12 Budget vs FY13 Budget (in millions)
| Year | FY12 Budget | FY13 Budget |
| 2014 | 2,233 | 3,137 |
| 2015 | 3,881 | 4,391 |
| 2016 | 4,096 | 4,937 |
| 2017 | 5,793 | 5,655 |
| 2018 | 6,699 | 6,305 |
| 2019 | 7,237 | 6,772 |
| 2020 | 58,809 | 76,339 |
| 2021 | 8,154 | 7,561 |
| Total, 2014-2021 | 46,781 | 45,952 |
But back to the point: did things get $111 billion more expensive? The price tag for the law quoted in the news before passage of the legislation (e.g. "Final Bill to Cost $940 Billion Over 10 Years") didn't come from the White House, it came from the legislative branch: the Congressional Budget Office is the official scorekeeper on cost estimates of proposed legislation. So how do the CBO's estimates for the costs of subsidizing exchange coverage compare with the White House's budgets?
I'm going to add together Table 1 and Table 2 to get the White House's projections for combined spending on premium assistance tax credits and cost sharing subsidies for each year. And then we can compare that to the CBO's estimates for the same thing.
The CBO's latest estimates of what the sum total of the premium tax credits and the cost sharing subsidies will be for each year through 2021 can be found in its February 2011 score of H.R. 2, the "Repealing the Job-Killing Health Care Law Act." That document shows, among other things, how much direct federal spending would be reduced each year by eliminating those subsidies.
Table 3: Premium tax credits + cost sharing subsidies, White House Budgets vs. CBO Projections (in millions)
| Year | FY12 Budget | FY13 Budget | CBO Projection |
| 2014 | 18,818 | 24,690 | 14,000 |
| 2015 | 35,904 | 47,653 | 33,000 |
| 2016 | 46,741 | 60,840 | 57,000 |
| 2017 | 53,994 | 67,485 | 71,000 |
| 2018 | 58,314 | 72,028 | 79,000 |
| 2019 | 62,360 | 77,433 | 84,000 |
| 2020 | 66,497 | 83,533 | 88,000 |
| 2021 | 70,852 | 90,124 | 94,000 |
| Total, 2014-2021 | 413,480 | 523,786 | 519,000 |
What we see is that the numbers in this year's White House budget are very much in line with what the CBO has been projecting all along. The White House's FY13 budget foresees spending $523 billion on folks in the exchanges between 2014 and 2021, while the CBO estimates the government will be spending $519 billion. The anomaly is last year's White House budget, which used numbers that were much lower than the CBO's.
The discrepancy in the FY12 and FY13 numbers the White House put out needs to be explained. But projections for spending on exchange subsidies are no higher this week than they were last week or last year or two years ago. The law isn't suddenly expected to be $111 billion more expensive, the White House has simply brought its budget numbers into alignment with what the official CBO price tag projections have been all along.
