Sentences to ponder

by on December 5, 2010 at 9:16 pm in Current Affairs, Medicine, Political Science | Permalink

Here is where some of the Republican economic thinkers are at:

"You're pushing back the subsidies and putting money back in Medicare where it belongs," [Douglas] Holtz-Eakin said Tuesday, speaking at a health reform conference sponsored by The Galen Institute and the American Action Forum, for which he runs Operation Healthcare Choice. "That's a very effective budgetary strategy."

The full story, mostly boring, is here.

1 David Wright December 5, 2010 at 7:37 pm

It's certainly not a strike for efficient use of government health-care dollars. Does anyone believe that the best use of the marginal government health care dollar is more health care for old people? No health economist does, and I'm pretty sure Holtz-Eakin doesn't really believe that.

But it is a strike for budgetary and political honesty. The Democrats wrote medicare spending limitations into their health care reform in order to make it look cheaper, assuming that they would be removed before it came time to implement them. So it seems entirely fair for Republicans to say: "Oh, you say you can do your health care reform for under $1T by limiting medicare growth? Okay, let's see you do it."

The interesting point to ponder is that a move that policy wonks on both the left and right would agree is effciency-improving is politically utterly taboo.

2 Roy December 5, 2010 at 8:57 pm

Actually as a Republican who hopes to become an old person I can think of no better use of resources. I suspect the vast majority of the masses agree with me. We almost all plan on getting old, and most of us have parents and grandparents that we are fond of. Everything that doesn't secure these payments (medicare & SS) or jepordizes these is a special interest.

Astounding as it may seem the Republican party has almost stumbled upon what the public wants. But I am sure the will screw it up out of some misplaced ideological consistency.

3 mulp December 5, 2010 at 11:39 pm

Let's see, cutting the health care for workers so the odds increase they will become disabled or die, shifting them from work to social welfare in order to increase insurance company profits by paying 114% for Medicare Advantage over what the inefficient bloated government direct Medicare payment system costs.

Right, makes perfect sense if you want to increase government spending.

Denying health coverage to the working poor without repealing EMTALA and finding a way for ERs to euthanize the patients who are uninsured, poor, and chronically ill will only increase total health care spending. The proof is in the higher efficiency, and much lower cost health care systems of the 30-40 nations with universal coverage.

And let's remember it was the Republican Congress that tried in the deficit reduction budget of 1997 to cut the cost growth of Medicare by simply mandating lower price increases without any effort to change the system. It wasn't long before Republicans temporarily reversed that measure without doing anything to fix it, so we are now in the 12th year of doing the "doc fix" several times a year.

Paul Ryan's Medicare cost control is based on effectively forcing everyone into Medicare Advantage, but fix the payment to the insurer so that if the costs continue rising on trend, the premium payment to insurers will be about 60% of current Medicare costs instead of 114%. Republicans want to reverse the reduction of the excess payment for Medicare advantage to increase insurer profits, so the odds of Ryan's limit on Medicare costs sticking are zero.

The system requires real reform, not simplistic and totally absurd cost limits that will never be allowed to go into effect.

And again, other nations prove costs can be controlled when everyone is in the system and everyone demands both quality and efficiency. What we have today is illustrated by the quote: screw the working poor to give favors to the political base: 65 and older, the doctors, hospitals, insurers, pharma.

4 Andrew December 6, 2010 at 2:21 am

Besides mulp, you need to take up your frustrations with Obama. I don't want what you want. Controlling costs is not the most important thing. Giving people free care while charging them while they are young and don't need the system is not the most important thing.

But Obama's the one who says he wants what you want and he's the one expanding the system that gave the government runaway costs.

5 beamish December 6, 2010 at 5:12 am

Actually as a Republican who hopes to become an old person I can think of no better use of resources.

Suppose you had a choice between spending government money on fixing the heart ailment of a ten year old or that of a ninety year old. Where do you think the money would be best spent?

The Democrats wrote medicare spending limitations into their health care reform in order to make it look cheaper, assuming that they would be removed before it came time to implement them

I'm pretty sure that's not their assumption. That's their (partial) solution and other types of solutions won't work. It's different from the sunsetting the Bush tax cuts. There, the budgetary consequences were an unfortunate consequence, to be covered up with smoke and mirrors. In the case, the budgetary consequences are half of the point.

6 Cliff December 6, 2010 at 5:43 am

Or you can keep Medicaid, if not you can have some alternative subsidy for paying deductibles for poor people if you don't want to rely on charity. Not an important difference budgetarily (just wanted to head off that objection).

7 DA December 6, 2010 at 6:54 am

Let's stop pretending that politicians care at all about the deficit. Having this foolishness and the umbrage over upper-income tax rates at the same time as our collective national freak-out over debt is embarrassing.

8 Yancey Ward December 6, 2010 at 7:49 am

Joe,

The other cuts in the past were also signed legislation. What is your point?

9 joe December 6, 2010 at 8:46 am

My point is that taking a meat ax to doctor pay rates is different from carefully choosing and negotiating hundreds of billions of cuts in areas where Medicare is generally agreed to be spending too much or spending inefficiently. The former is not politically feasible, the latter is — but only if those who profess to care about entitlement cuts actually learn the facts of the situation rather than following their partisan cues.

Instead, the GOP proposes to repeal these cuts, and their partisans say "oh, those cuts were never gonna stick anyway, and it's the Democrats' fault for cutting them in the first place." Guys, this is the most low-hanging of the low-hanging fruit in Medicare. If you're not willing to hold the GOP accountable for trying to repeal these cuts, what in the world are you willing to stand up for?

10 joe December 6, 2010 at 9:35 am

I disagree with "always a bait and switch plan." The Gingrich-era GOP consistently supported Medicare cuts, it was not inevitable that the Boehner GOP would unanimously oppose any Medicare cuts. The problem with Medicare cuts in the past has always been Democrat demagoguery, but now you have Democrats supporting cuts and signing them into law. Regardless of whatever "plans" may have secretly existed, the cuts passed and Republicans had the option to defend them. But instead they've chosen the "health sector money plus seniors' votes" option.

My interpretation of Tyler's more recent post is that Obama is no longer willing to use his dwindling political capital to support Medicare cuts, now that it's so clear the GOP will never help him in that.

11 To December 6, 2010 at 10:51 am

@Cliff: Step 1, give everyone HSAs and free high deductible insurance, get rid of Medicare and Medicaid. Step 2, there is no step 2, you just achieved universal coverage and cost control.

Hmmm….. No. Cost control maybe, but not universal coverage. HSAs are a great way to get your health spending subsidized at your marginal income tax rate, if you can afford it in the first place. For the 50% or so of Americans who pay no income tax, it just means: pay for your health care yourself. In short, it's just a subsidy for being wealthy.

Let them eat cake.

Besides, there is no reduction in aggregate spending for letting people pay themselves beyond a small co-insurance.

12 beamish December 6, 2010 at 2:15 pm

Well, if that's all part of the plan, then the Democrats should have no problem with the budgetary constrains the Republicans want to hold them to.

It would be pretty cool if, faced with a Republican threat to shut down the government unless given a plan to eliminate the long term deficit, Democrats countered by replacing Medicare with a generous version of France's health system or Singapore's. Maybe the Republicans would claim credit for forcing Democrats to cut spending.

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