FixHealthCarePolicy

Congressional Gimmicks leave Doctors and Taxpayers in a Lurch

The Senate voted 45-52 yesterday to oppose the $140 billion so-called “extenders bill” (HR 4213). The Hill is reporting that Sen. Max Baucus (D-MT) is going to offer a slimmed down version for consideration as early as today. Two key health provisions of the bill are expected to be a continued bailout of state Medicaid programs and a temporary Medicare ‘Doc Fix’.

The Sustainable Growth Rate (SGR), initiated in 1997, links the increase in Medicare reimbursement rates to growth in GDP. Since medical costs historically increase at a rate more than twice GDP, the SGR reduces the real payments physicians receive. A temporary “fix” has happened nine times in nine years to increase Medicare rates above SGR levels. Temporary fixes are the easy way out for politicians because they appear less costly to budget.

The Hill reports that Senator Baucus is going to use a budgetary trick by paring down the “doc fix” from 19 months to 6 months. Of course, this means that the budgetary cost of the bill will appear smaller, but in reality the only difference is that Congress will have to revisit this issue in 6 months instead of 19 months – kicking the can down the road once again. (more…)

Tags: doc fix, federal spending, Medicare, Patient Protection and Affordable Care Act, Sustainable Growth Rate, tax extenders bill

Paying for Obamacare: Kicking the Can Down the Road to Future Generations

Health care reform was supposed to lower health care spending while expanding access for the uninsured. Instead, though Obamacare will cost taxpayers trillions, it will do little to address the rising cost of care. The government overhaul will not only have large and immediate negative effects for Americans of every ilk, but will have severe implications for future generations, amassing more federal debt to kick down the road to tomorrow’s taxpayers. In a recent paper, Heritage expert James Capretta lays out the several ways in which Obamacare will add to, rather than reduce, federal deficits:

– Omission of the “Doc Fix”: “The Obama Administration and leaders in Congress chose to use all of the tax hikes and spending cuts they could find to create another new entitlement instead of paying for a fix for Medicare physician fees.” According to Capretta, the cost of the doc fix will fall between $250 and $400 billion over a decade.

– Double-Counted CLASS Act Savings: The CLASS Act creates a long-term insurance program where enrollees must pay premiums for five years prior to receiving benefits. Writes Capretta, “premiums paid by enrollees build a small surplus—about $70 billion over 10 years according to CBO—which the health law’s proponents claim as deficit reduction. But these premiums will be needed in short order to pay actual claims.” (more…)

Tags: CLASS Act, doc fix, double-counting, Medicare cuts, ObamaCare, underestimated coverage loss

Obamacare’s True Costs Coming to Light

Remember how President Barack Obama promised that his health care plan would reduce the deficit and put us on a path towards fiscal responsibility? Remember how Congress kept gaming the system to come up with the Congressional Budget Office (CBO) score that could justify those claims? Well, now that Obamacare has become (hopefully only temporarily) the law of the land, the CBO is singing a slightly different tune. Last Friday CBO Director Doug Elmendorf wrote on his blog:

“The central challenge is straightforward and stark: The rising costs of health care will put tremendous pressure on the federal budget during the next few decades and beyond.”

“In CBO’s judgment, the health legislation enacted earlier this year does not substantially diminish that pressure. In fact, CBO estimated that the health legislation will increase the federal budgetary commitment to health care (which CBO defines as the sum of net federal outlays for health programs and tax preferences for health care) by nearly $400 billion during the 2010-2019 period. Looking further ahead, CBO estimated that the legislation would reduce the federal budgetary commitment to health care in the following decade—if the provisions of the legislation remain unchanged throughout that entire period.”

(more…)

Tags: CBO, CBO Director Doug Elmendorf, CLASS Act, doc fix, job-based coverage, Medicare cuts, ObamaCare

Obamacare’s Cooked Books and the “Doc Fix”

The Obama administration continues to insist (see this post from White House budget director Peter Orszag) that the recently enacted health-care law will reduce the federal budget deficit by $100 billion over ten years and by ten times that amount in the second decade of implementation. They cite the Congressional Budget Office’s cost estimate for the final legislation to back their claims.

And it is undeniably true that CBO says the legislation, as written, would reduce the federal budget deficit by $124 billion over ten years from the health-related provisions of the new law.

But that’s not whole story about Obamacare’s budgetary implications — not by a long shot. (more…)

Tags: Congressional Budget Office, cook the books, doc fix, entitlement expansion, Medicare, ObamaCare, Peter Orszag

Obama Administration Glosses-over Key Concerns for Doctor Shortage

When Health and Human Services Secretary Kathleen Sebelius recently addressed a crowd of health policy experts about the issues surrounding the nation’s physician shortage, she had the opportunity to highlight the fundamental problems doctors have been shouting about, like medical malpractice reform.

Alas, she mostly stuck to the tired talking points that more primary-care physicians would flock to the profession if there were only more preventive services, more health information technology and better coordination of chronic diseases.

That’s not to knock any of those measures, but they fail to address the disincentives that Heritage health experts say will drive more general doctors out of their practice. Instead, analysts have urged Congress and the Obama Administration to deal with:
– Doctors’ fears about medical malpractice lawsuits that has resulted in excessive use of medical tests
– Physicians’ insecurity of taking on any Medicare patients because of Congress’ failure to present a long-term solution to the coming payment cuts
– Their loss of entrepreneurial opportunities because ObamaCare kills the creation of new physician-owned hospital

(more…)

Tags: doc fix, medical malpractice reform, ObamaCare, physician shortage, physician-owned hospitals

Side Effects: Pre-Existing Physician Payment Problems Persist

No one can criticize the Obamacare legislation for being too short. But even at 2K+ pages, the new law fails to address some major problems with the health system. One of these is the flawed formula Congress created years ago to determine how much the Medicare payment physicians receive for services rendered.

Year after year, the Congressional reimbursement formula calls for sharp reductions in Medicare payment rates. And year after year, Congress votes to suspend its own formula. That keeps doctors from bailing out of the Medicare program, but it does nothing to remedy the problem of rapidly expanding Medicare costs. (more…)

Tags: "deficit reduction", doc fix, Medicaid, Medicare, ObamaCare, reimbursement formula, Side Effects

How the Left Really Plans to Pay for Obamacare

According to the Congressional Budget Office (CBO), over half of President Barack Obama’s new $940 billion health care entitlement is paid for by price-fixing Medicare cuts. Never mind that the President’s own Centers for Medicare and Medicaid Services says that these cuts would cause “roughly 20 percent” of Medicare providers to go bankrupt in Obamacare’s first 10 years. The CBO has to believe these cuts will happen because they are required, by law, to believe everything Congress tells them. The American people are not. So the American people ought to know that instead of cutting doctors’ Medicare reimbursement rates by 21% as required by law on April 1, the Centers for Medicare and Medicaid Services froze payments at current levels until Congress could come back after Easter recess and rescind those cuts. Again. As they have done every year but one since the cuts were first enacted in 1997.

This doc fix is big enough that, if it had been included as a cost of Obamacare, it would have sent the President’s bill into the red all by itself. But the half trillion dollars in Medicare cuts used to fund the rest of Obamacare are a much bigger problem. Even if we assume they all go as planned, President Obama’s budget would borrow 42 cents for each dollar spent in 2010; would run a $1.6 trillion deficit in 2010; and would leave permanent deficits that top $1 trillion as late as 2020. Add on the half trillion dollars in Medicare cuts that, given Congress’ track record, the American people would be naive to think will ever happen, and the federal government is looking at a pile of new debt. (more…)

Tags: balance the budget, Congressional Budget Office, doc fix, health care entitlement, higher government spending, Medicare cuts, President Obama's budget, Value Added Tax, VAT

Guest Blogger: Rep. Michael Burgess, M.D. (R-TX) on Obamacare’s Impact on Doctors

As the health care reform debate began over a year ago, the American Medical Association, the top doctors group in the country, released a list of its top priorities for health reform. The AMA is a powerful association, and many have credited it with helping to kill HillaryCare, so the organization, of which I am a member, was in a good position to impact President Obama’s health care reform plan and accomplish some of doctors’ long-awaited goals. Remember, without doctors, there is no health care, so it is important that health reform address the issues that are important to doctors and will help them keep their doors open and better serve America’s patients.

Two of the AMA’s top priorities are also two of the main reasons I decided to run for Congress almost 10 years ago – repealing the flawed Medicare physician payment formula, and nationwide medical liability reform. Unfortunately for doctors, Democrats in Washington, who have had control of Congress for over 3 years, have shown absolutely no signs of seriously addressing either of these issues. But with the AMA’s clout, I was hopeful that this time, with comprehensive health care reform a major goal for President Obama, these two big issues would finally be addressed.

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Tags: American Medical Association, doc fix, HillaryCare, IRS, medical liability reform, Medicare physician payment formula, ObamaCare, Rep. Michael Burgess

Obamacare’s Delusional Deficit Reduction Claims

Congressional leaders are gleefully reporting that the Congressional Budget Office score of their health care proposal released yesterday shows that their legislation would reduce the federal deficit by $138 billion in the first ten years. Not so fast—consummate professionals though they are, CBO provides a projection based on assumptions about the future conduct of Congress that do not always represent reality.

Ruth Marcus of the Washington Post, not exactly a supporter of the GOP, puts it this way: “…Democrats will be pointing to this preliminary CBO score as if it is engraved on stone tablets. Republicans will proclaim their respect for the CBO and proceed to argue that its estimates should not be taken too seriously in this instance. This may come as a surprise, but I think the Republican argument is closer to correct. To crow, as did House Speaker Nancy Pelosi, that the package is “a triumph for the American people in terms of deficit reduction” is premature at best, delusional at worst.” (more…)

Tags: Congressional Budget Office, deficits, doc fix, double-counted savings, excise tax, Public Opinion, reconciliation bill

Health Care Provisions Buried in The Unemployment Benefits Extenders Bill

Congressional liberals are working overtime. In case you missed it, hidden behind the non-stop news coverage of the health care debate, the Senate-passed extenders bill includes several health care provisions that follow the same flawed policies of the big Stimulus Bill. Once again, these provisions move the health care system in the wrong direction.

– COBRA or Nothing. The bill would give premium relief only to those unemployed workers who opt for COBRA coverage. It is well documented that COBRA coverage is one of the most expensive options available to those who lose their jobs. Workers would be better served if they were able to decide whether to use this temporary assistance on COBRA or another more affordable option, including policies available in the individual market.

– Another Medicaid Bailout. The bill would continue to use federal taxpayer funds to bailout state Medicaid programs. While state budgets are crippled by Medicaid, the solution is not to transfer the cost on the federal taxpayers. Instead, Congress should get serious about Medicaid reform and grant states the flexibility they need to fix the program. (more…)

Tags: COBRA, doc fix, economic stimulus bill, Medicaid bailout