Prescription for Disaster

Interesting Analysis of How ObamaCare Will Transform American Medicine

Sunday, February 20, 2011
Writing about the future of healthcare on Health Affairs Blog, one analyst has considered the implications of ObamaCare and found it will push people out of insurance and lead to fewer choices for many Americans.   The author, John Goodman, writes ObamaCare "will [not] be the kind of change anticipated by the people who gave us the Affordable Care Act (ObamaCare)."

Instead, Goodman writes that instead of bringing "millions of people into the health insurance system." Obamacare will "push millions of people (at least partially) out of it."   He notes that the supporters of ObamaCare sought to create a system in which everyone has equal access to care but that under the law the effect "will be the exact opposite — a two-tiered system in which access to the best doctors and the best facilities will depend very much on your ability to pay."  Additionally, ObamaCare was supposed to "create universal access to care.  Yet our more vulnerable populations — the poor, the disabled and the elderly — are likely to have less access to care under the new reforms than they have today."

No wonder the American people oppose ObamaCare - it will push people out of insurance, put healthcare out of reach for many, and create a lack of access to care for the most vulnerable Americans.
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How Do ObamaCare’s Budget Numbers Add up Now?

Saturday, February 05, 2011

When Congress originally passed ObamaCare, Democrats promised the law would reduce the deficit. They pointed to CBO’s cost estimate that the healthcare provisions in the law would reduce the deficit by $124 billion from 2010 to 2019.

But CBO’s estimate relied on fanciful assumptions that CBO is require to assume would happen. When a bill requires future cuts by Congress, CBO assumes the cuts will happen even when Congress has never allowed similar cuts to ever take effect. In other words, as former CBO Director Doug Holtz-Eakin described the budget analysis of Obamacare, “fantasy in, fantasy out.”

When the Senate voted this past week to repeal ObamaCare’s 1099 reporting requirements, it did so in a way that would add to the deficit and increase ObamaCare’s cost by $17.1 billion. So, at best, ObamaCare’s new deficit reduction number will shrink to $106.9 billion. 

That is if one is willing to:

(1) Assume $575 billion of ObamaCare Medicare cuts will actually go into effect (critics point out, if implemented, Seniors would lose access to care);

(2) Assume physician payment cuts take effect and Congress won’t enact any further “doc fixes” (the cost of the doc fix from 2012 to 2021 is $302 billion, Congress has never let these cuts take effect);

(3) Ignore the budget gimmick of double-counting $70 billion in CLASS Act revenue which is being used to pay for ObamaCare’s costs today but promises future long-term care entitlement benefits later (at a cost of trillions of dollars that even Democrats have called a “Ponzi scheme”); and

(4) Assume the rosy assumptions regarding the number of people who will actually avail themselves of subsidies are accurate while ignoring the fact that ObamaCare will incentivizes employers to dump their employees and push them to subsidies instead.

Repealing the Medicare cuts and enacting a doc fix would cost an additional $877 billion over ten years.  Accordingly, just preventing the Medicare and doc fix related cuts (and ignoring the other aspect of the law) would mean ObamaCare increases (not decreases) the deficit by at least $770 billion from now until 2021.  Therefore, under the likely scenario, ObamaCare amounts to nothing more than a massive expansion of government that will increase the deficit, potentially by trillions of dollars.


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Coverage for Seniors Cut Under ObamaCare

Thursday, February 03, 2011
Karl Rove has an insightful editorial in today's Wall Street Journal focusing on the true plight of the nameless "Granny" so frequently invoked as reason for health care reform. Contrary to a claim made by Obama in a speech late last week (and undoubtedly many times before) that "Granny is safe" because of the health care law, Rove reminds readers that this "safety" is imaginary. 

Not even a year since its passage, ObamaCare has already driven insurance providers from the industry. Without these providers it is now impossible for 700,000 elderly to renew their private Medicare Advantage plans.

ObamaCare does not lessen Granny's struggles in 2011, either. Medicare Advantage will see $2 billion in cuts this year; $6 billion the year after that. Ultimately, half of the 14 million seniors with these policies will lose them, according to the Centers for Medicare and Medicaid Services.

But that's still not the end. If Granny is fortunate enough to keep her Medicare Advantage plan, she will then face the challenge of not only finding a doctor, but finding a doctor who accepts her policy. This could be a difficult task should the doctors surveyed by the nonprofit Physicians Foundation be correct when they say the new health care law will force them to close their practices or, at best, significantly reduce their Medicare and Medicaid patients.

Hardly protecting the proverbial "Granny", ObamaCare creates a storm of elements - fewer insurance providers, renewal challenges, misdirected spending cuts, and doctor shortages - that make her far from safe.

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House GOP Presses to Repeal Medicare Advisory Board

Wednesday, January 26, 2011

House Republicans today introduced another piece of repeal legislation, this time targeting the removal of ObamaCare's Independent Payment Advisory Board (IPAB), the group of 15 unelected bureaucrats responsible for advising Congress on Medicare rates starting in 2015. Rep. Phil Roe (R-TN) sponsored the bill, H.R. 452 The Medicare Decisions Accountability Act, and is currently reaching out for Democrat co-sponsors. According to Roe, 50 Democrats expressed opposition to creating this Board in 2009. As such, it will add even more pressure to Democrat leaders in right-leaning states to band with the Republicans on repeal legislation.

A press release on Roe's website provides some background on IPAB's purpose and impact on American health care:

IPAB's sole intention will be to determine whether Medicare is spending more than is budgeted and, if so, to make cuts that then will be fast-tracked with very little opportunity for congressional input. In effect, with the creation of this board, Congress has ceded much of its authority to oversee Medicare. This board does not have a mandate to improve patient care - it has a mandate to meet a budget, and that harms patient care.



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ObamaCare's Medicare Reductions Threaten Seniors' Access to Care

Wednesday, January 19, 2011

This week the Heritage Foundation published a paper on the impact of ObamaCare's severe cuts to Medicare.  The conclusion?  ObamaCare's cuts to Medicare will reduce seniors' quality of medical care and according to the Congressional Budget Office (CBO), the cuts to Medicare will not result in any savings for the program or any enhanced Medicare solvency.




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Taxes To Rise Under ObamaCare

Monday, January 17, 2011

Americans for Tax Reform today released a list of 21 taxes associated with ObamaCare. The list describes the taxes, notes their dates of implementation, breaks down the tax increase percentages by amount and year, and estimates their generated revenue. Definitely worth a read.

Here is an at-a-glance view of these new or higher taxes with ATR's summaries of a few of the most disturbing or unusual ones highlighted in more detail (#21 is my favorite):

1) Individual Mandate Excise Tax

2) Employer Mandate Tax

3) Surtax on Investment Income
"Involves the creation of a new, 3.8 percent surtax on investment income earned in households making at least $250,000 ($200,000 single)."

4) Excise Tax on Comprehensive Health Insurance Plans

5) Hike in Medicare Payroll Tax

6) Medicine Cabinet Tax
"Americans no longer able to use health savings account (HSA), flexible spending account (FSA), or health reimbursement (HRA) pre-tax dollars to purchase non-prescription, over-the-counter medicines (except insulin)."

7) HSA WIthdrawal Tax Hike
"Increases additional tax on non-medical early withdrawals from an HSA from 10 to 20 percent, disadvantaging them relative to IRAs and other tax-advantaged accounts, which remain at 10 percent."

8) Flexible Spending Account Cap - "Special Needs Kids Tax"
"Imposes cap of $2500 (Indexed to inflation after 2013) on Flexible Spending Accounts (now unlimited)...[t]his new cap will be particularly cruel and onerous [for] parents of special needs children... many of [whom] them use FSAs to pay for special needs education. Tuition rates...can easily exceed $14,000 per year."

9) Tax on Medical Device Manufacturers

10) Raise in "Haircut" for Medical Itemized Deduction from 7.5% to 10% of adjusted gross income

11) Indoor Tanning Services Tax
"New 10 percent excise tax on Americans using indoor tanning salons."

12) Elimination of Deduction for employer-provided retirement prescription drug coverage in coordination with Medicare Part D

13) Blue Cross/Blue Shield Tax Hike

14) Excise Tax on Charitable Hospitals
Tax of "$50,000 per hospital if they fail to meet new "community health assessment needs," "financial assistance," and "billing and collection" rules set by HHS."

15) Tax on Innovator Drug Companies
"$2.3 billion annual tax on the industry imposed relative to share of sales made that year."

16) Tax on Health Insurers

17) $500,000 Annual Executive Compensation Limit for Health Insurance Executives

18) Employer Reporting of Insurance on W-2
"Preamble to taxing health benefits on individual tax returns."

19) Corporate 1099-MISC Information Reporting

20) "Black liquor" tax hike
"This is a tax increase on a type of bio-fuel."

21) Codification of the "economic substance doctrine"
"This provision allows the IRS to disallow completely-legal tax deductions and other legal tax-minimizing plans just because the IRS deems that the action lacks “substance” and is merely intended to reduce taxes owed."

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Obama Administration Suing to Force People into Gov't Healthcare

Friday, January 14, 2011

If you like your insurance you can keep it?  Remember that promise from President Obama last year?  Try telling that to the five seniors who have chosen to forego Medicare and are now being sued by the Obama Administration to force them into Medicare.  

These seniors want to keep their private sector health insurance, but sill accept their earned Social Security benefits.  This arrangement should be a win-win for both the taxpayers and the seniors.  But HHS is suing them, arguing that they cannot accept Social Security without also being forced into Medicare.  

The federal judge hearing the case has ordered HHS to specify which "statues, regulation or administrative decision" justifies the government's position.  The government has been unable to point to any legal requirement that justifies its position.

What is becoming clear is that the Obama Administration is intent on forcing people into government health care, even in cases where the law does not support the government's actions.


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ObamaCare - "Pushing America down the road to serfdom"

Friday, December 31, 2010

Over at Reason Magazine, Shikha Dalmia has an excellent article on one of ObamaCare's major flaws - the way it vilifies and exacts excessive punitive fines against doctors who make honest clerical erors.

Dalmia writes:

The government loses about 10 percent of its total health-care spending—or about $60 billion—to “fraud” annually. Some of this is genuine fraud involving physicians—or people posing as physicians—submitting claims for services or equipment never delivered and indefensible therapies that have nothing to do with patient care. But the most common fraud allegedly involves “overbilling” by providers. Medicare’s billing codes are a complicated, convoluted mess and deciphering them can sometimes be more art than science. Naturally, doctors try and interpret them to extract the best possible payment from Uncle Sam. Both Republicans and Democrats huff and puff against “waste, fraud and abuse” in Medicare. And they have already enacted Stasi-style laws such as the False Claims Act offering nurses, patients and other whistleblowers 15 percent to 30 percent of any money recovered if they report improper billing practices by providers. But the Obama administration has attacked the matter with renewed zeal because it is a key element in funding Obamacare’s generous new entitlements.


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ObamaCare's Advanced Appropriations Put Gov't Takeover on Auto-Pilot

Tuesday, November 30, 2010
The Congressional Research Service (CRS) released a report last month detailing the large amount of money contained in ObamaCare to fund implementation over the next ten years.  To those who read ObamaCare before it passed none of these individual spending provisions should come as a surprise.  The noteworthy aspect of the CRS document is that it aggregates these spending provisions, putting them into a concise document which details a vast amount of spending.

This is another problem with ObamaCare, it puts nearly $100 billion of spending to implement ObamaCare on autopilot and makes the job of Congress to conduct oversight regarding implementation harder.  Now that spending is already in motion, it will be harder for Congress to cut spending or withhold spending to gain leverage over the leviathan that is HHS.

AHEC has compiled a brief list of the amount and description of the Appropriations (the page numbers correlate to the hyperlink for ObamaCare contained above):

Section 1002 (page 139) – Consumer Assistance (Grants)
First FY, $30,000,000
Subsequent years, such sums as may be necessary

Section 1003 (page 140) – Federal Takeover of Premium Reviews (Grants)
$250,000,000

Section 1005 (HCERA) – Reform Fund
$1,000,000,000

Section 1101 (page 143) – Administrative Costs of High Risk Pools
$5,000,000,000

Section 1102 (Page 145) – Coverage for Early Retirees
$5,000,000,000

Section 1311 (page 173) – Health Benefits Plans
Blank Check – “amount necessary” to carry out this section

Section 1322 (page 188) – Grants to Create Non-Profit Insurers
$6,000,000,000

Section 1323 (page 195) – Community Health Insurance Option
Such sums as requested by the Secretary
$1,000,000,000

Section 2405 (page 305) – Expansion of A/D Resource Centers
$50,000,000 ($10,000,000 x 5FY)

Section 2701 (page 318) – Adult Health Quality Measures
$300,000,000 ($60,000,000 x 5FY)

Section 2707 (page 327) – Medicaid Psychiatric Demonstration Project
$75,000,000

Section 2801 (page 328) - MACPAC
$11,000,000

Section 2951 (page 343) – Home Visiting Programs
$1,500,000,000

Section 2953 (page 352) – Personal Responsibility Education
$375,000,000 ($75,000,000 x 5)

Section 2954 (page 352) - Education
$250,000,000

Section 3013 (page 384) – Quality Measure Development
$375,000,000 ($75,000,000 x 5)

Section 3014 (page 387) – Quality Measurement
Up to $100,000,000

Section 3021 (page 394) – CMS Innovation
$5,000,000
$10,000,000,000

Section 3024 (page 408) – Demonstration Project
$30,000,000

Section 3026 (page 415) – Transition Program
$500,000,000

Section 3027 (page ____) – Demonstration Project
$1,600,000

Section 3306 (page 470) – Assistance for Low-Income Programs
$300,000,000

Section 3403 (page 506) – Board
$150,000,000 ($15M adjusted annually for inflation)

Section 4002 (page 541) – Prevention Fund
$5,000,000,000

Section 4101 (page 547) – School Based Health Centers
$200,000,000 ($50M x 5)

Section 4108 (page 564) – Incentives to Prevent Chronic Diseases n Medicaid
$100,000,000

Section 4202 (page 570) – Wellness
$50,000,000 transfer

Section 4204 (page 473) – Immunization
$1,000,000

Section 4306 (page 587) – Child Obesity Programs
$125,000,000

Section 5210 (page 615) – Ready Reserve Corps
$100,000,000

Section 5507 (page 668) – Demonstration Projects
$425,000,000 ($85M x 5)
$15,000,000

Section 5508 (page 672) – Teaching Capacity
$230,000,000

Section 5509 (page 675) – Grad Nurse Program
$200,000,000

Section 6201 (page 727) – Background Checks
$160,000,000

Section 6301 (page 728) – Research
(1) Amounts in a fund
(2) $1.26B + trust fund sources (see formula)
(3) Fund based appropriations

Section 6402 (page 761) – Program Integrity
$350,000,000

Section 8001 (page 842) – Class Act
Up to amount collected in a trust fund

Section 9023 (page 883) – Therapeutic Discovery Project
Such sums

Section 10203 (page 931) – Enrollment Prgrams
$40,570,000,000

Secs. 10211-10214 (page 931) – Pregnancy Assistance grants
$250,000,000

Section 10323 (page 959) – Medicare for Hazardous Exposure
$215,000,000

Section 10502 (page 1003) - Facility Construction
$100,000,000

Section 10503 (page 1004) – Community Health Center Fund
$1,500,000,000
$1,500,000,000






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ObamaCare's Impact on Seniors

Sunday, November 14, 2010
Here is an interesting article on A Line of Sight about ObamaCare's impact on seniors and the ensuing Medicare cuts.
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