Friday, March 19, 2010

Budget Lies in Health Care: Who cares?

As discussed in previous posts, the health care bill proceeds on the unrealistic assumption that Medicare reimbursements paid to healthcare providers will be reduced during future years. Without that reduction, the deficit reduction element of this bill goes away. To the contrary, the true costs begin to emerge. Along with smoke and mirrors accounting, which accelerates taxes and defers benefits, the true costs of government-provided healthcare in the final tally will be much more onerous than the Obamacare supporters are willing to let on.

The recent CBO figures that are being touted by the Democrat leadership as they chant a deficit reduction mantra while at the same time running our country into bankruptcy are based on this Medicare assumption. However, cuts in Medicare reimbursement rates are not sustainable, as providers simply cannot provide these services for even lower reimbursement rates. At least three possibilities emerge to address the problem: (1) increasing rates for services on insured patients (now everyone else) even more, thus allowing the providers to subsidize the Medicare patients with revenues from insured patients; (2) de facto rationing of care to seniors dependent on Medicare, with these seniors becoming worse off as a result of the health care bill because they cannot find providers who will serve them; or (3) a later “fix” that will restore benefit levels to sustainable rates, thus protecting seniors dependent on Medicare.

The first and second options will be politically unsustainable, as they will dramatically raise costs for the insured or impose those same costs on the Medicare population. Neither is a sane approach to this problem. So a betting person would put his/her money on the third option. But of course, this will significantly increase the costs of this health care package and take away the "deficit reduction" cover, even with all the smoke and mirrors accounting.

A memo posted at politico.com today, which purports to come from democratic strategists, shows that a Medicare fix is indeed in the works, but supporters are instructed not to talk about it. The memo points out that “most health staff are already aware that our health proposal does not contain a ‘doc fix’ [i.e., a restoration of these benefit cuts]." The memo goes on to explain: “The inclusion of a full SGR [sustainable growth rate] would undermine the reform’s budget neutrality. So, again, do not allow yourself (or your boss) to get into a discussion of the details of CBO scores and textual narrative. Instead, focus only on the deficit reduction and number of American’s covered.”

In other words, LIE.

If people want to have health care funded by the government, then they should step up and be honest about what it will cost, who will pay, and how much. Then let's vote on it. This kind of deceptive behavior is unconscionable, but it is the modus operandi of the current administration. And I thought that it was supposed to be all about transparency, giving people an "up or down" vote, removing special interests from the legislative process, and bipartisanship!

You can read the full text for yourself here: http://www.politico.com/static/PPM138_100319_recon.html

EAM

3 comments:

Anonymous said...

I take it you don't want to provide health care to the 30 million Americans who don't have coverage.

You also don't mind having a country ranked 1st in health care costs but 30th in outcomes.

I guess for some reason that's ok?

Augustus said...

In fairness, this administration doesn't do anything drastically different in terms of transparency and openness compared to any other. Did anyone really expect a politician to keep all promises?

Anonymous said...

You are correct Augustus. Most of did not expect an honest, transparent Obama Administration. But it is the hubris and pious attitude of the tax cheating, secretive, shallow-thinking members of his adminstration that really burns to the marrow.