Health Care: Cost Estimates may Scuttle Plan
CMS, the Centers for Medicare and Medicaid Services, part of Health and Human Services, has provided some analysis of the new senate plan forwarded by a group of Democratic senators and majority leader Reid.
The “estimated financial effects” include some that may cause some moderate Democrats to withdraw support. An estimated 5 million Americans are expected to be dumped into the government plan by employers, while still leaving 24 million legal residents without insurance at all. Medicaid rolls would swell by 18 million, putting further pressure on state budgets that are already hurting. And overall health care spending would be increased by 11 billion dollars due to increased taxes and fees passed on to consumers.
New and increased taxes of 29 billion dollars and proposed cuts of 493 billion in Medicare help offset the costs of the plan, but have some problems of their own: reductions in payment to providers could result in less choice for seniors, a politically risky proposition. In some areas, losing a Medicare provider could result in the loss of all services for that area.
Net costs, after proposed cuts in spending and increases in taxes, is estimated to be an increase of 234 billion dollars. The report hedges its bets, though, with this statement, appearing right after the cost estimate:
The actual future impacts of the PPACA on health expenditures, insured status, individual decisions, and employer behavior are very uncertain. The legislation would result in changes in the way that health care insurance is provided and paid for in the U.S., and the scope and magnitude of these changes are such that few precedents exist for use in estimation.
The Senate plan relies on cuts and taxes that are unlikely to remain in the bill as horse-trading begins to gain passage, reducing further the “accuracy” of the CMS estimate.
The proposed Medicare “buy in” provision for residents 55 and older draws opposition in and of itself, with Sen. Joe Lieberman voicing his opposition:
Sen. Joe Lieberman told Senate Majority Leader Harry Reid Sunday that he couldn’t support a new Medicare proposal floated as a compromise to the public option, a development that complicates the bill’s path towards passage before the end of the year.
In a meeting in Reid’s office just off the Senate floor, aides said the Connecticut independent reiterated his concerns with the public insurance option and told the Nevada Democrat that he couldn’t support a new plan to allow people as young as 55 to buy into Medicare.
Missouri Democratic Sen. Claire McCaskill declared she would “absolutely” vote against any bill that increases the deficit, as President Obama has promised to veto any such measure. And even senate liberals have reservations:
And it’s not just moderates who have problems with the Medicare buy-in. On Friday, a group of 10 Democratic senators, including Wisconsin’s Russ Feingold and Vermont’s Patrick Leahy, wrote to Reid, worried that expanding the program without changing the rates Medicare pays to doctors would curtail seniors’ access to care. The letter came a day after a report by the Centers for Medicare and Medicaid Services found that the bill’s Medicare savings “may be unrealistic.”
After boldly announcing that a compromise had been reached, Reid saw his party’s senators “walk back” the statement. The compromise was only to send the proposal to the CBO for financial impact score, they said, most adding they remain committed to the idea of a deficit-neutral bill. The Politico article sums up the situation from Sen. Reid’s perspective:
If he kills a public option or the Medicare buy-in plan, he could lose the support of Sanders and several of the more liberal members of the Democratic conference. But keeping either of those plans, or one that would “trigger” a public option if private insurers don’t hold down costs, would lose Lieberman – forcing Reid to find at least one moderate GOP senator to advance the proposal.
To win the most likely potential GOP defector, Sen. Olympia Snowe (R-Maine), Reid would likely have to make modifications and slow the debate down since she’s signaled that the Senate needs to take more time to deal with the expansive issue.
Cross posted to Donklephant
If the recent debate on health care has taught us anything…it’s that the consumer is not in the driver’s seat on this.
Drug Companies, Insurance companies, Hospitals, and doctors…the ones that set the pricing for medical care…all have their high paid lobbyist prowling the halls of congress, dishing promises of golf outings, campaign contributions, future employment and other goodies to the hungry members of congress.
As long as money is being waved in front of our elected representatives…don’t expect them to pay much attention to voters. After all even elections are won by slick ads that cost money…so follow the money , right?
My wife and I have found a solution that seems to work for us…
Health care beyond America’s borders.
With medical costs a fraction of what the health care industry charges us in the US, we’ve found excellent affordable health care in Thailand, of all places..even without insurance.
To woo the cash strapped and weary American uninsured and underinsured, The Thais (and Indians, Malaysian, and Singaporeans) have built excellent private hospital system that provide top notch care for a fraction of the costs in the US.
These hospitals are accredited and follow the same standards as in the US. In fact they outperform US hospitals in service and care.
Yet you can expect to pay 1/10th to 1/20th what it cost for the same procedure in the US.
Heart Bypass…US $150,000.
Hear Bypass..Thailand $15,000
My minor throat surgery for disphagia…US $2500
Thailand $100.
(That was 1 year ago today and I am back in the US… very much alive.)
In fact in Thailand most people have no use for health insurance. Prices are so affordable that Thais would rather save the insurance premiums and bank it.
While we in the US get hit twice….once by the insurance company…and the second time by the medical profession. So we pay twice for health care.
And don’t think that you are safe with insurance in America. Check your insurance policy for hidden costs like deductibles, copays and insurance caps and you will be shocked to find that health care coverage is VERY LIMITED
The US health care system is a train wreck hurtling down the mountainside with NO hope that anything…even the health care proposals in Congress can fix.
As long as the people who stand to gain the most profit from health care are calling the shots…people who rely on the US health care system are SCREWED.
And here’s the rub. People would like you to believe that the American health care system is a free market system driven by competition.
Nothing could be further from the truth.
A few giants control the insurance industry and a few medical associations strive to keep competition from putting downward pressure on compensation.
Like… when was the last time you saw a hospital post it’s rates like a restaurant posts it’s dinner prices???
When was the last time you saw a physician run a TV advertisement offering lower cost medical care like every hotel, car dealer, grocery chain, clothing store, bicycle shop, and fast food outlet in the United States?
So while everyone in the United States seems so wrapped up in tinkering around the edges of heathcare with tort reform, purchasing insurance across state lines, living healthier, public options, providing insurance for everyone…..the real culprit is staring us in the face: the people who make a living off of health care. Until they agree to compete in a free market, we will never lower costs.
My idea: open up the borders to cheaper drugs from other countries, allow foreign doctors and nurses to provide health care in the US. Allow Medicare and insurance to cover procedures performed overseas. More competition.
More competition would be good, but I think the real problem is in the very beginning of your comment: the consumer is not in the driver’s seat. David Goldhill, writing in the Atlantic, noted that the REAL customer is either the insurance company or the government program that is paying the bill, not the patient. His article, How American Health Care Killed My Father is eye-opening.