The legal and political implications of the Supreme Court’s hearings on the health reform law have pushed aside attention on the economic consequences. If the law hit all its spending targets and realizes all its projected revenues and savings, there would be minimal impact on the federal deficit through 2018, according to Congressional Budget Office projections revised last month. But in later years, the law would begin running a deficit that would grow to nearly $50 billion annually. And there are reasons to believe the law will run deficits before 2018. First, it will be difficult to realize all the projected savings. Second, even moderate cost overruns could be very expensive. Third, people will find ways to game the system. Obama’s plan, like the previous system, is unlikely to solve the financial problems of health care.

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