Obama on Medicare and Medicaid bankrupting the government.

Obama yesterday: "And the rising cost of Medicare and Medicaid will sink our government deeper and deeper into debt."


From letter by Richard S. Foster, Chief Actuary for Centers for Medicare and Medicaid Services. Dec. 10, 2009 regarding Senate Health care bill:

"Of the additional 33 million people who are estimated to be insured in 2019 as a result of the PPACA, a little more than one-half (18 million) would receive Medicaid coverage due to the expansion of eligibility to those adults under 133 percent of the FPL. "

Link to that information (pages 6, 7)

http://www.samhsa.gov/Financing/post/Estimated-Financial-Effects-of-the-Patient-Protection-and-Affordable-Care-Act-of-2009-as-Proposed-by-the-Senate-Majority-Leader-on-November-18-2009.aspx

Congressional Budget Office:

"As shown in the following table, CBO estimates that if the federal government paid all of the costs of covering newly eligible Medicaid enrollees for all states through 2019, net SPENDING WOULD INCREASE by about $35 billion over the 2010-2019 period relative to spending under H.R. 3590 as passed by the Senate."

Congressional Budget Office:

"You also asked how such a change in the amount of federal assistance to states would affect the federal budgetary commitment to health care. The federal budgetary commitment to health care—a term CBO uses to describe the sum of net FEDERAL OUTLAYS for health programs and tax preferences for health care—would ALSO INCREASE by about $35 billion between 2010 and 2019 if all states received the same level of federal assistance for Medicaid as Nebraska.”

Congressional Budget Office:

"The country faces a fundamental disconnect between the services the people expect the government to provide...and the tax revenues that people are willing to send to the government to finance those services. That fundamental disconnect will have to be addressed in some way if the budget is to be placed on a sustainable course."

Obama in State of the Union:

"Let me repeat. We cut taxes. We cut taxes for 95% of working families."

Congressional Budget Office on ways Medicare/Medicaid is cut in Senate bill:

"Reducing Medicaid and Medicare payments to hospitals that serve a large number of low-income patients, known as disproportionate share hospitals (DSH), by about $43 billion—composed of roughly $19 billion from Medicaid and $24 billion from Medicare DSH payments."

December 1, 2009 - Boston Herald

"Some three years after Massachusetts’ ambitious health-care reform effort required all residents to have health insurance, the hospitals that serve the state’s poorest residents say the state’s below-market reimbursement rates are pushing them to the brink of financial ruin."

Link:

http://bostonherald.com/jobfind/news/healthcare/view/20091201six_hospitals_to_sue_state_over_reimbursement_rates/srvc=home&position=also

February 22, 2010

"States Put Medicaid on Life Support as Budgets Fall Short"

Link:

http://www.thefiscaltimes.com/Issues/Health-Care/2010/02/22/States-Put-Medicaid-on-Life-Support-as-Budgets-Fall-Short.aspx


Some providers currently opt out of Medicare/Medicaid, and many close their practices to new Medicare/Medicaid after accepting a few because the government reimburses less than what it costs them to provide their services.
Below - Link to Centers for Medicare and Medicaid Services (CMS) report that between 1992 and 2010, inflation to provide patient care rose 54%, while government reimbursements only 11%, as of Monday. Before Monday, there was a roughly 20% gap between costs and reimbursement updates.

Document titled: sgr2010p.pdf, table 8, page 6

http://www.hhs-stat.net/scripts/orgurl.cfm?orgabb=CMS-OA

CMS defines inflation as the Medicare Economic Index, which they define as:

"The MEI is a measure of inflation faced by physicians with respect to their practice costs and general wage levels. The MEI includes a bundle of inputs used in furnishing physicians’ services such as physician’s own time, non-physician employees’ compensation, rents, medical equipment, etc"

Congressional Budget Office on Medicare "savings" from senate bill:

"It is unclear whether such a reduction in the growth rate could be achieved, and if so, whether it would be accomplished through greater efficiencies in the delivery of health care or would reduce access to care or diminish the quality of care."

CBO link:

http://cboblog.cbo.gov/?cat=5