Health Care Budget Gimmicks Will Lead to Future Nightmares

Chris Field
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Posted: Mar 21, 2010 2:09 PM
Going into this vital weekend on the future of ObamaCare and the overall wellbeing of our country--not just in our personal health, but economically and politically--the Senate Republican Policy Committee (RPC) published a policy paper titled “Democrats’ Budget Gimmicks Today Create Spending Nightmares Tomorrow.” From the introduction:
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 seem to raise $210 billion over 10 years. But, like the non-indexed Alternative Minimum Tax (AMT), this lack of indexing will force more Americans to pay these “upper-income” taxes each year.

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.

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?