[The following are health-care related sections of a briefing by Administration officials on the budget deficit. If you wish to read the unabridged transcript check the newsgroup ALT.POLITICS.CLINTON for the Subject: 1994-01-27 Panetta and Bentsen Briefing on Deficit Reduction -- Steve Freedkin , LIST.HEALTHPLAN Manager] THE WHITE HOUSE Office of the Press Secretary __________________________________________________________________ For Immediate Release January 27, 1994 PRESS BRIEFING BY OMB DIRECTOR LEON PANETTA AND SECRETARY OF THE TREASURY LLOYD BENTSEN The Briefing Room 2:40 P.M. EST SECRETARY BENTSEN: Good afternoon. There's nothing I like better than delivering good news, and we sure have it today. We've been telling people all along that we're getting that deficit down and getting it down faster than we thought possible. And now we have an independent validation of that number. Let me quote just briefly from the news report from the nonpartisan Congressional Budget Office on its latest estimates of the deficit. [...] Let me tell you what those numbers do. For the next few years things look pretty good. Both the figures from the Office of Management and Budget and the CBO, those numbers drop off slightly through '96. But then they start going back up again toward the end of the decade, but only assuming no health care reform. And that's a very important point to make here. The CBO deficit numbers, which don't factor in health reform at all, explode upward beyond the year 2000 because of sharp increases in Medicare and Medicaid spending. They shoot right up to $365 billion by the year 2004. Now, if you look at those numbers with health care reform, the deficit starts coming down, not up, just like we said it would. So if anyone thinks there's not a crisis over health care, just ask the fellow who has to write the checks that cover the deficits. Let me tell you, there is a fund crisis brewing here unless we get health care reform. The message is simple: With health care reform we get that deficit headed down, and without it, it shoots right straight up. There are two conclusions here: First, we've made substantial headway on the deficit since President Clinton took office. We're ahead of schedule. We're making a bigger dent than we thought, and we're getting important confirmation of that. Secondly, it is imperative that we enact comprehensive health care reform to prevent a funding crisis and to keep that deficit headed down. With that, let me turn it over to Leon Panetta to fill in the details on the rest of that substance. DIRECTOR PANETTA: Thank you, Mr. Secretary. [...] The second message is that we have a responsibility to deal with health care reform this year -- not next year, this year -- deal with it in a comprehensive way and establish the discipline, the same kind of discipline in the health care area that we've been able to establish with regards to government spending generally under our budget. We think that CBO today is ringing the bell, saying please stay on track with the direction that we set last year. Any questions? [...] Q If the President -- his health care plan is phased in more slowly than the 1998 that's called for in his plan, what would be the impact on the deficit numbers that you're projecting? DIRECTOR PANETTA: Obviously, it depends on the period of phase-in and when you actually put a comprehensive plan into place. I might point out that one of the reasons that the President believes so deeply in comprehensive health care coverage is because, even according to CBO, you can't begin to control health care costs unless you develop a comprehensive universal plan for the American people. That's the key. The sooner you put that into place, the better chance you have to control costs. And the longer that takes, then, obviously, the longer it takes to discipline those costs. [...] Q Mr. Panetta, is it your position that if we --given the deficit reduction law that has been passed, that if the Congress adopts health care reform this year, that that's it, we've cured the deficit, and we have no longer a deficit reduction problem? DIRECTOR PANETTA: I've been in this business too long to ever make that kind of blanket statement. I think you can say pretty clearly that if we continue to stick to the economic plan and to the deficit reduction plan in terms of each year's reduction that has to be met, we stick within the caps, that we clearly have set the deficit on a downward track. If we can enact health care reform, we can continue that track into the next century. Are there going to be other things that we have to deal with? Are there other things that we're going to have to face as we go through it? I'm sure. But the two principal factors we need to deal with right now are, a, controlling federal spending -- and we're doing that with the caps that have been established in the budget pack, and dealing with health care costs that are out of control. CBO, in its book, basically confirms that if you're looking at the entitlement areas alone, that most of the entitlements are growing below GDP except for Medicare and Medicaid. So those are the principal culprits that have to be dealt with. [...] THE PRESS: Thank you. END 3:02 P.M. EST