Building on yesterday's post, I think the costs that have been shifted are probably larger than first reported. Here's the Congressional Budget Office (CBO) report: Medicare outlays are expected to rise twice as fast as Social Security spending in 2006 -by 11.8 percent -largely because of the ramping up of the new prescription drug program. That percentage increase from 2005 outlays, however, understates the growth in Medicare spending. A shift in certain payments from October to September 2005 and a legislated delay in payments at the end of this fiscal year have moved an estimated $11.3 billion in Medicare outlays from fiscal year 2006 into 2005 and 2007. So not only have costs been shifted forward to 2007, but also shifted back to 2005, for a savings of $11.3 billion. That's about $6 billion more than we thought. UPDATE: I just talked to someone at CBO, and he said that about $4 billion from FY 2006 was shifted to 2005. The money was for HMOs enrolled in the Medicare Advantage Plan. They get paid at the first of the month, or, if the first of the month is on a weekend on a holiday, the last business day before the first of the month. Last year, October 1st was on a Saturday, so the October payment went out in September, which was FY 2005. He also said that the delayed payments will add up to about $7 billion, not $5.3 billion. All of it together is $11.3 billion, which brings the actual FY 2006 deficit to $271.3 billion. Also, my suspicion that this gimmick accounted for the drop in entitlement spending this year is probably wrong. CBO said they accounted for both the early 2005 payment and the delayed 2007payment in their March estimate. The official I talked to said they don't know why health care spending dropped, but that they'll probably know in February.