Friday, May 15, 2009
These are the folks who will decide health care reform debate
Everybody is for health care "reform," including me. Lately, though, there has been a lot of big talk about pushing a bill through Congress this year but precious little in the way of concrete proposals for how to pay for it.
Extending health insurance coverage to the roughly 50 million people who don't have it now (about 250 million do) will cost about $120 billion a year. President Obama included provision in his budget for $60 billion of that, but half of the funding he proposed was to come from eliminating much of the tax deductibility of charitable contributions. Congress has already ruled out that proposal, so we're in a $90 billion hole.
Another possible source of revenue that has some fans is to limit the tax deduction for employer-provided health care plans. But that has been ruled out by House Ways and Means Chairman Charles Rangel. And no one is even seriously mentioning a new tax, because that would be shot down, too.
Where that seems to leave "reform" is hanging by the thin thread of cost reductions. People have been beating that drum for decades, but real cost savings have rarely materialized. Obama made a game effort to rally various health care players behind the idea of savings earlier this week. They all like the "idea" and supposedly pledged to find ways to cut a whopping $2 trillion over the next 10 years. Unfortunately, when some of them realized that Obama was actually putting these numbers out there, some of them said, "Oh we didn't mean that. Never mind!"
The truth is that extending health care coverage to 20% more people than have it today will either cost a great deal in the way of large-scale (and long-term) investments in increasing the numbers of health care practitioners and facilities to treat all those folks, or require some form of rationing, whether through added cost-sharing by patients or regulation.
The major forces driving health care costs are largely independent of the system of paying for it. They are a growing population; the aging of the population as quality care extends life; the high expectations of a prosperous population; and the continuous improvements in medical practice, technologies and therapies that make it possible to diagnose and treat more illness. None of this is going to change.
Even so, the Obama Administration and the Congressional leadership are totally committed to a change -- this year -- and simply cannot back away from it. They will, therefore, wind up hanging their hats on cost controls. That inevitably will mean new limits on services through Medicare and Medicaid and/or higher premiums, deductibles and co-pays for Medicare beneficiaries.
Here is my prediction: seniors are not paying much attention to this whole issue now, because they have health insurance. In all likelihood, they also don't think Obama and a Democratic Congress will monkey with their coverage. When they start to pay attention, watch out on Capitol Hill, because these folks vote. I mean, they ALL vote. And whether you're a member of Congress from New York, Florida, Texas or California, they will make your life miserable.
Have any thoughts about the sleeping senior behemoth? Post a comment.
Posted by J. E. Burke at 8:36 PM