What Medicare Needs is a Consumer-Driven Market

Neurologists are about to feel the sting of the Affordable Care Act. Beginning Jan. 1, Medicare will be paying them less for electrodiagnostic procedures used in identifying and treating a wide range of nerve and muscle disorders. Reimbursement rates for some tests will be slashed by more than 50 percent, and the Centers for Medicare & Medicaid Services estimates that payments to neurologists overall will shrink by 7 percent next year.

Medicare's cuts will be implemented by changing the way fees for the diagnostic procedures are calculated. Instead of reimbursing neurologists for each nerve analyzed, the new billing codes will henceforth bundle multiple nerve-conduction tests into a single fee. The Obama administration claims that under the current system Medicare has been paying too much for neurologists' overhead costs. But the American Academy of Neurology, in an advisory to its members, warns that the cuts will devastate "neurology practices large and small, many of which rely on these services to meet their bottom line." Patients will be hurt as well: As Medicare squeezes neurologists, seniors' access to neurological care will dwindle.

Might as well get used to this. With a long-term unfunded liability of $38 trillion, Medicare will go broke if it isn't fixed, and compelling providers to accept lower fees is how ObamaCare proposes to fix it. Yet if government technocrats could keep health-care affordable by paying doctors and hospitals predetermined fees for each service they provide, Medicare wouldn't be going broke in the first place. When it turns out once again that Medicare's budget can't be tamed through stringent price controls, regulators will inevitably look for other ways to ration health care.

In 2009 President Obama suggested that maybe his sick grandmother's hip replacement wasn't something "society" should have had to pay for. Americans, he said, needed "some independent group" to make those "very difficult" decisions.