Tag Archives: Baucus Health Reform Bill
Thursday’s (10/08/09) much heralded CBO report telling us that the Senate Finance Committee health care reform bill will cut the federal deficit by $81 billion over the next ten years is a diversion at best and accounting fiction at worst. Any way you slice it, this health reform bill is going to cost you more.
First of all, any second year accounting student could drive a homecoming float through the loopholes in the CBO’s numbers. Just one example: the analysis includes ten years of increased government taxes and fees, but only six years of health reform expenses. It also assumes that Medicare will cut Medicare doctor fees by a whopping 25% in 2011 and then make below-inflation-rate adjustments after that. The reality is that the Congress has scheduled cuts every year since 2003 but has cancelled them all at the last minute in the face of massive physician lobbying. But what if this time is different and these cuts actually do go through? If past is prologue, then doctors will simply intensify what many have already done in the face of Medicare’s increasingly punitive reimbursement rates:
I never had much hope that Senator Max Baucus’ Finance Committee would bring forth a sensible anodyne to the House’s fatally toxic Affordable Health Choices Act, although I admit that his earlier markup had some promising features. While it didn’t have anything that would ever bend the cost curve in any direction but skyward, there were some aspects of his approach to the insurance exchange that showed at least a modicum of respect for market realities—unlike Speaker Pelosi’s risible public option. But all that vanished yesterday with the Senator’s new markup.
I’m still wading through the bill, but one conclusion stands out: the insurance exchange, as described in the bill, will fail. Or more accurately, any private insurer or member-owned co-op that offers individual health insurance through the exchange will be quickly bankrupted unless it can get massive subsidies from the government.