Wednesday, August 15, 2012

'ObamaCare Doesn't Cut Benefits.. It Just Rolls Back Payment Rates'

So says Sarah Kliff in the Washington Post. After admitting the figure of $716 billion in Medicare cuts is accurate, she goes through some sophistry and ends up with this conclusion:

It’s worth noting that there’s one area these cuts don’t touch: Medicare benefits. The Affordable Care Act rolls back payment rates for hospitals and insurers. It does not, however, change the basket of benefits that patients have access to. And, as Ezra pointed out earlier today, the Ryan budget would keep these cuts in place.

I already had something to say about ex-Journolista Ezra Klein's spin on this but let's deal with Ms. Kliff's conclusion.

'The Affordable Care Act rolls back payment rates for hospitals and insurers. It does not, however, change the basket of benefits that patients have access to.'

Of course it does! The Independent Advisory Medical Boards ( IAMBs ) were designed to destroy medicare by cutting payments to doctors to the bone so that fewer and fewer of them except Medicare patients. The result? Rationing of care for seniors ( which is already happening) the destruction of Medicare Advantage and the death of the program, as seniors are herded into one size fits all ObamaCare where their health care can be rationed with impunity.

Ms. Kliff makes the statement that 'Hospitals agreed to these cuts because they knew, at the same time, they would likely see an influx of paying patients with the Affordable Care Act’s insurance expansion'. Aside from the fact that there's no evidence for that claim, it frankly makes no sense. If steak is priced at $3 per pound at the market, costs the store $2 dollars in costs and the government says they're willing to pay $1.50 for it, all the 'influx of paying customers ' guarantees is that they'll go broke that much quicker.

It's the same with medical services, and all it means is that a growing number of doctors and hospitals simply won't accept medicare patients any more. It's already happening, as any senior can tell you.

A 'benefit' that is worthless because you can't use it is no benefit at all.

And there's no way to spin it.


nazar said...

Hey maybe rationing of health care is exactly what we need. We don't have infinite resources, and we already have the highest spending on health care of any country, most of which is spent in the last year of a person's life. What's the sense in that? I mean, we're good at keeping people alive longer, but we can't actually fix them.

I had a situation recently where my car's transmission went out. This was a 2000 Toyota with 170,000 miles on the odometer. I could have chosen to fix it for thousands of dollars, and then deal with another problem a few months later, but instead I got a new car and scrapped the old one. Now I know it may seem heartless to compare old people to old dingy cars, but that doesn't matter, because the principles of economics apply equally here. Now, if someone has the money to pay for expensive treatment (let's say advanced lung cancer) or their family is willing to pay, then I have no problem with that. However, they do NOT have the right to demand the taxpayers to pay for their treatment if there is a low chance of recovery, especially if that person is at the end of their life.

I think we're getting to a point where there's a critical mass of people who expect to be carried along the taxpayers' backs, but we just don't have the money for that. And the debt this situation is incurring is going to economically choke young people like me.

I know you complain about people leeching of the government, but you never point out the fact that old people are the biggest culprits. The only way we're gonna fix this is either through some breakthrough technologies in medicine, but since we don't have that right now (nor should we depend on it), it's about time we started to take a good hard look at how we take care of people from a purely economic standpoint.

Rob said...

Hello Nazar,
I hope all's well.

As you point out, people and cars are quite different.

The whole concept of insurance is that it's a crap shoot where the winner wins if he loses and loses if he wins. People pay premiums over a long period of time against the possibility something bad might happen, and you can't change the rules of the game on people who have paid in and made plans based on those rules.

Second, while the baby boomers are going to account for an increase in healthcare spending because of their sheer numbers, that's not the main culprit of the increase in healthcare costs.

The major factors in the increase are fraud, the high cost of predatory lawsuits and the enormous costs of hospitals and ERs eating the cost of healthcare given to illegal aliens.

Cut down on fraud, institute reasonable tort reform and deal with the illegal alien problem and the costs become quite manageable.

The Romney-Ryan plan which would allow competition from the private sector to increase efficiency and lower costs is also a superb idea.