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Even though Democrats claim that their health care legislation is fiscally responsible, an analysis of current law, the Senate-passed health care bill, and the reconciliation “sidecar” reveals all the deadlines and funding cliffs that convert the legislative package into a series of budgetary tricks. These tricks will have Congress spending the next several years scrambling to undo them to keep special interests happy.You should read the whole thing, but here’s a brief rundown:
March 31, 2010: The Medicare “doc fix” expires. The White House’s 2011 budget plans to solve the problem with $371 billion in new deficit spending.
October 1, 2010: Because the savings in the higher-ed provisions of the reconciliation bill will be spent on health care, Pell Grant funding will be $5.5 billion short this year alone.
January 1, 2013: The “upper-income” Medicare tax on wages and investment are not indexed for inflation, making them
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January 1, 2015: Medicaid reimbursements to primary care physicians are increased only for 2013 and 2014--these provisions will have to be extended every years beginning in 2015.
January 1, 2015: Medicare reductions/cuts, which the White House’s actuaries believe “are unlikely to be sustainable” and will “jeopardiz[e] access to care for beneficiaries,” are scheduled to begin. Congress will likely stop the cuts, eliminating much of the “savings” the Democrats are claiming.
January 1, 2019: The growth rate of health insurance subsidies goes down, meaning individuals would have to buy health insurance they cannot afford.
January 1, 2020: “The CBO has found that ‘beginning in 2020, the reconciliation proposal would index the thresholds for the high-premium excise tax to the rate of general inflation rather than to inflation plus one percentage point.’ This change would result in a major and growing tax increase on middle class health benefits.”
January 1, 2020: The Medicare prescription drug “doughnut hole” is not closed until 2020--coincidentally outside the bill’s 10-year budget window. This hides the bills true cost.
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With these looming deadlines, the RPC raises these questions:
*Will Medicaid payments for physicians fall by 21 percent this year--and more in consecutive years--to meet the targets under the existing SGR mechanism?
*Will low-income students suffer reductions in Pell Grant awards--resulting in even more student loan indebtedness--because higher education savings were re-directed to health care?
*Will more and more middle-class Americans be affected by higher payroll and investment taxes?
*Will 16 million new Medicaid patients be unable to see a physician in 2015 due to reimbursement cuts taking effect then?
*Will a board of unelected bureaucrats follow through on efforts to impose additional cost-cutting measures that have the effect of “jeopardizing access to care for beneficiaries?”
*Will individuals be forced to buy “government-approved” health insurance without being able to afford it?
*Will struggling middle-class families be hit with a massive tax increase in the years after 2020?
*And if the answer to any of the above questions is “No,” where and how do Democrats expect to fund the new federal spending required to meet these commitments?
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