Sunday, November 15, 2009

Health Care Reform Non-sense

We get two reports, both by Centers for Medicare and Medicaid Services (CMS) - one saying how House bill increases the cost by $289B over ten years and the another one reporting how Medicare paid $47B and Medicaid paid $18B all in improper bills, essentially how Tax payers money was wasted there.

Despite all these types of reports coming out, New York Times writes an editorial portraying how Congress intends to 'take on the cost control' issues in proposed slate of House and Senate Health Care Reform bills. It is the same line what the prominent Health Care Blogger Ezra Klein takes - poor Americans who cannot get or cannot afford Health Care will not wait until the 'cost problem' is solved but rather it is a moral imperative for the government to expand the coverage now. All these Progressives argue that as long as Health Care Reform (HCR) includes all these diverse cost cutting measures, it is sufficient because we do not know which ones work in reality. However, there is scant attention to what are the realistic chances of any of these cost cutting measures are adopted strictly and not simply glossed over.

The problem is we know that none of these cost control measures will work as long as Congress continues the current practices of financing Medicare and Medicaid. As Doc fix showed (where Senate attempted to pay $250B over 10 years in a separate bill to cover cuts in Medicare fees to Doctors and Hospitals); Congress always finds a back door entry to overwrite all these proposed cuts in Medicare. With such an inability to control entitlements,HCR is nothing but expansion of already costly entitlements with an argument that we are anyways going to be bankrupt as a nation so what is the harm in accelerating that process?

It is a moral imperative to payback all those who lend you the money too. With a possibility of American default not so remote, how can we ignore that 'moral' duty of honoring Fed bond buyers?

Truth is acceleration of a process which will bankrupt this nation is not necessary in responding to the calling to help 'have-nots'. If Congress and Progressives wanted so desperately to do something for poor; they could have opted for removing Medicare & Medicaid waste upfront and then use that saved money to cover socially weak citizens. With CMS reports, we know that at 10%; we are talking here around $60B saving per year (Medicare $40B + Medicaid $20B), essentially $600B over 10 years instead of the current boondoggle at $900B over 10 years called as HCR which likes of NYT want to justify so vehemently. Realization of savings needed is upfront because we cannot believe Congress when it says it proposes to save 'so and so' amount. (Otherwise also all the current Congressional bills assume half of the money to come from disciplined operations of Medicare and Medicaid.)

Interesting thing is expert bloggers like Ezra Klein very well know that the core problem is 'price control / cost control' in our current system and proposed excise tax on insurance for 'Cadillac plans' is the nearest what you get in an attempt to keep a lid on these costs. Everything else are platitudes, good intentions of Congress to address this problem in future and some half hearted attempts to undertake some experimentation. Nothing concrete there. As of now, prices set by Providers in this country (Doctors, Hospitals and other Health Care Service Providers) do not have any worthwhile and direct control. We do not talk about a 'fee schedule' in this country as like many in Europe use. Not that in this 'market only approaches' country we do not have 'price controls'. The famous working example is Public Utilities Commission which sets utility prices (electricity, gas and water) at State level and private companies compete in that market on those rates and still earn money. Unless we have such controlled pricing for providers, all other things are mute - private or public insurance, coverage and mandate, etc.

Senate bills have such MedPac or iMAC commission mechanisms included; but those are watered down with no intention of Congress to follow on those. House bill does not have this provision and so it is no brainier that the joint Conference Committee would adopt at the most a watered down version of such provisions.

With the core problem of 'provider prices' unaddressed, no amount of blathering or NYT Editorializing would save the looming disaster here. Any Congress member who takes solace in faultily argued support of current bills, would no doubt be setting himself or herself for the 'throw these bumps out' reaction by the electorate. Congress has wasted a critical year in arguing and politicking HCR when it should have devoted the entire energy for revising economy, employment and financial regulatory reforms. Not only Congress has just simply wasted this crucial time, it has accelerated the push of this country towards bankruptcy due to uncontrolled entitlement expansion. It was originally President Obama's idea to take up HCR this year and for the whole year he has allowed the Congress to digress from a fiscally responsible road. So he is equal party to all this non-sense.

No wonder, as time passes, less and less number of people are believing in the value of HCR the way Congress has designed so far. This is quite a blatant political as well as policy failure heaped by Dem majority when America could ill afford such disasters. For 8 years this country endured ideologically driven Neocon policies which have cost this country Trillions of dollars and now Dems are taking their turn in repeating same. A country is journey towards a bankrupt dead end has bi-partisan support in USA!

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