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Battle Grows Over Obama Administration's Health Care Law Accounting

It was only a few minutes in the making but comments last week by Health and Human Services Secretary Kathleen Sebelius on Capitol Hill have set off a firestorm of criticism around President Obama’s health care law and how the law, when it’s finally implemented, will have “double counted” on Medicare -- and, therefore, does not have the savings once predicted by the White House.

“The Affordable Care Act adds 12 years to the Medicare trust fund, according to every actuary, and the $500 billion represents a slowdown in the growth rate of Medicare over 10 years from what was projected at 8 percent to a growth rate,” Sebelius said during questioning by Rep. John Shimkus, R-Ill.

But, as Shimkus pushed the issue, asking for Sebelius to explain if the president was using the $500 billion to save Medicare or fund health care reform, Sebelius added one word – “both.” And that word has made many more nervous than ever about the health care law, as they say it sounds like double counting, or using money from one program to count into another, which does not equal savings.

As previously reported by Fox News, more than half the total financing for the health care reform legislation comes from the $500 billion in cuts to the entitlement program. But since the White House began its health care sell, critics have said the president is misleading Americans, because the “cuts” actually are set aside to pay for other programs.

“Quite frankly I would say that it's intellectually dishonest. You can’t have it both ways, cut and then spend someplace else and say that you're preserving Medicare,” Sen. Charles Grassley, R-Iowa, said earlier this year when the double counting was first reported by Fox News.

The idea of complaining about a double count is not new to the White House. In March 2010, "Special Report" anchor Bret Baier specifically questioned Obama about the issue.

Obama at the time made it clear – there was no robbing Peter to pay Paul in the health care legislation.

“You can't say that you are saving on Medicare, and then spend the money twice,” Obama said.“What you can say is that we are going to take the savings, put them back to make sure that seniors are getting help on the prescription drug bill instead of that money going to, for example, insurance reform.”

The White House has faced intense scrutiny about the cost of the bill, as tabulated by the Congressional Budget Office (CBO) since the legislation was first introduced. Republicans have long criticized the revenue versus the costs of the bill, noting that the bill collects revenue for four years before the program is actually implemented. Which, according to Republicans means that in a 10-year budget window, there’s only six years of costs coming in – giving a skewed picture of the cost of the bill over the 10-year window, though Democrats point to figures that still show savings over longer time periods.

Democrats say the CBO formulas used to tabulate the overall costs of the bill can’t calculate the benefits and savings from programs like preventative care – which they feel will make a significant difference in the long run.

“The scoring of the Affordable Care Act is entirely consistent with how legislation has been scored for the 30 years, under presidents of both parties, and Congresses of both parties,” Richard Sorian, Health and Human Services assistant secretary for public affairs, wrote in an e-mail to Fox News. “Savings in programs like Medicare and Social Security are scored as improving the solvency of those programs and reducing the deficit.”

But Sen. John Barrasso, R-Wyo., says the CBO can only score what they’re given, and Democrats can’t reach into the unknown future for cost savings.

“The Congressional Budget Office has to score whatever they're handed even if it things that are never going to happen and that's what happened here,” Barrasso told Fox News. “People that look at this legitimately realize that it is going to cost the country significant amounts of money, trillions of dollars over time, and it's something simply the American people cannot afford.”

For their part, House Democrats say Sebelius’ comments last week are very clear – the cuts are at the projected level.

“That’s why Secretary Sebelius says it’s a reduction in the growth rate – not because it causes some sort of a double-dip recession,” a senior Democratic House aide told Fox News.

Fox News' Jim Angle and Wendell Goler contributed to this report.