Fed report: House bill's $500 billion in Medicare cuts will reduce benefits and endanger access to care for seniors

Seniors: One super-voting bloc politicians mess with at their peril

For months now, it's been clear that the road to "deficit neutral" health care reform is a bumpy, maybe even dangerous, one for seniors. Ironically, in their zeal to extend health insurance to the roughly 40 million people who don't have any, President Obama and many Democrats in Congress appear ready to make deep cuts in Medicare, a program that is on the short list of the signal domestic accomplishments of the Democratic Party over the past 80 years, alongside Social Security, labor rights, and civil rights. What the 45 million seniors and people with disabilities who depend on Medicare are going to think about this remains unclear, although it's hard to see why they would embrace it with resignation.

A new report from the non-partisan Centers for Medicare and Medicaid Services (CMS), the agency that administers Medicare and Medicaid, has now confirmed the $500 billion in cuts in the House health care bill that passed a week ago will reduce Medicare benefits and run a real risk of limiting seniors' access to care. From the Washington Post:

A plan to slash more than $500 billion from future Medicare spending -- one of the biggest sources of funding for President Obama's proposed overhaul of the nation's health-care system -- would sharply reduce benefits for some senior citizens and could jeopardize access to care for millions of others, according to a government evaluation released Saturday.

The report, requested by House Republicans, found that Medicare cuts contained in the health package approved by the House on Nov. 7 are likely to prove so costly to hospitals and nursing homes that they could stop taking Medicare altogether.

Congress could intervene to avoid such an outcome, but "so doing would likely result in significantly smaller actual savings" than is currently projected, according to the analysis by the chief actuary for the agency that administers Medicare and Medicaid. That would wipe out a big chunk of the financing for the health-care reform package, which is projected to cost $1.05 trillion over the next decade.

More generally, the report questions whether the country's network of doctors and hospitals would be able to cope with the effects of a reform package expected to add more than 30 million people to the ranks of the insured, many of them through Medicaid, the public health program for the poor.

In the face of greatly increased demand for services, providers are likely to charge higher fees or take patients with better-paying private insurance over Medicaid recipients, "exacerbating existing access problems" in that program, according to the report from Richard S. Foster of the Centers for Medicare and Medicaid Services.

[snip]

In its most recent analysis of the House bill, the CBO noted that Medicare spending per beneficiary would have to grow at roughly half the rate it has over the past two decades to meet the measure's savings targets, a dramatic reduction that many budget and health policy experts consider unrealistic. [Emphasis added.]

Whatever bill Senate Majority Leader Harry Reid takes to the Senate floor this week will also have to rely on hundreds of billions of dollars in Medicare cuts to pay for it.

Most of the public debate about health care reform has focused on the issue of a public option and the overall cost, with the Medicare cuts usually mentioned only in passing. It wasn't long ago that more liberal Democrats were the fiercest defenders of of Medicare and Medicaid, as in 2007 when President Bush proposed cuts that were a fraction of those now approved by House Democrats. No more. Democrats want to pass a bill, so they are largely mum on this topic and talk only about generating "efficiencies" and tackling "abuses" in Medicare.

And the Republicans? Some Republicans may take it up as a talking point now and then, but the GOP's deep-seated objection to "entitlements" like Medicare and Medicaid eliminate them from serious contention as a defender of seniors in this case.

What about the supposed "seniors' lobby," AARP? It has thrown its support behind the House bill in a deal that will bring more customers to its lucrative insurance business.

So seniors are on their own. But here's the thing about that. Seniors -- and near-seniors -- are handily the most reliable group of voters. They may have to hobble on their canes to get to the polling place, but they do vote.

As early as last July, it was already noteworthy in many polls that opposition to health care reform was higher among seniors. That's still true -- but you ain't seen nothing yet. Assuming a bill that cuts $400-500 billion from Medicare is signed into law, the issue will no longer be hypothetical, or muddled by a constantly changing and confusing array of proposals, or hidden behind high-minded rhetoric and clever spin. When it becomes clear to seniors that their health insurance benefits actually have been reduced and that it's going to even harder to find a doctor who accepts Medicare patients (a growing number of physicians have already opted out of Medicare), anyone who voted for it is going to have a hard time convincing constituents over 60 that it's a good deal.

Anyway, it's not just about politics. What's so "progressive" about slashing health care benefits for tens of millions of older Americans -- a large majority of whom have low to moderate incomes -- to subsidize benefits for younger Americans, many of whom don't want insurance now and will resent being obligated to take on premium payments? Beats me.

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