Doc Fix: Another Massive Budget Gimmick

Today, as part of the Ryan-Murray budget deal, the House will be voting on the “Pathway to SGR Reform Act of 2013,” which extends a number of expiring Medicare provisions, but its main purpose is to prevent the 24% reimbursement cut for physicians serving Medicare patients scheduled to occur next year.

These so-called “doc fixes” have been commonplace in Congress since 2003, when the provider cuts from the Balanced Budget Act of1997 first prompted Congress to act to prevent payment cuts for doctors (for more on the Sustainable Growth Rate, aka the SGR, see this Backgrounder from the Heritage Foundation). However, these temporary measures are usually fully paid for using legitimate savings elsewhere in the Medicare program.

Unfortunately, today’s doc fix bill does not continue the trend of fully offset SGR patches.

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Morning Action: The Truth About Medicare

MEDICARE.  Some people are blaming the sequester for the decrease in cancer patients’ access to Medicare treatment.  Heritage untangles the spin:

But policymakers and taxpayers alike may want to take a closer look: Immediately ahead, for fiscal year 2013, the total effect of sequestration will be $3 billion. That is the same amount Obamacare is supposed to reduce Medicare spending this year.

But if Medicare patients can’t access vitally needed care because of $6 billion in total reduced Medicare payments, they’d better prepare for next year. That’s when Obamacare cuts an estimated $41 billion out of Medicare—in addition to the Medicare sequestration cuts of $9 billion that year.

The total effect of sequestration on Medicare benefit spending is $100 billion from 2013 to 2023. Those cuts pale in comparison to the $716 billion in Medicare payment reductions required by Obamacare over the same time period.

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Conservative Medicare Reform is a Must

Many people weigh in on the Medicare debate solely from an emotional standpoint.  That’s a problem.  But arguably even more damaging is when people conflate or confuse conservative Medicare reform with recklessly damaging Medicare.

The opposite is true.

Conservative reforms to Medicare are designed to increase efficiency, control costs, and provide high quality care.  The reforms would restructure Medicare, which is currently outdated and flawed.   Finally, rather than leaving a failing Medicare program untouched, conservatives acknowledge that the Medicare population is growing, and the reforms Heritage has proposed are based on that reality.

First with regard to costs, the Heritage Foundation explains:

The rising cost of Medicare is placing an increasing burden on current and future taxpayers, as well as exacerbating the poor financial condition of a program on which America’s seniors depend in their retirement. The traditional program’s fee-for-service payment system, in which doctors and hospitals are paid a fixed price for each and every procedure or service that they perform, encourages an increase in the volume of services provided, which drives excessive spending. The system also does not ensure that quality care is delivered, which contributes to unnecessary costs and higher spending as well. Today, roughly three of four Medicare patients are enrolled in the traditional Medicare program.

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Morning Action: Obama Wooing Republicans

CHARM OFFENSIVE.  In search of a big, second-term budget deal, President Obama has begun reaching out to a handful of Republicans in what Bloomberg dubs a “shift.”  Senators Tom Coburn (R-OK), Susan Collins (R-ME), Lindsey Graham (R-SC), John McCain (R-AZ), and Rob Portman (R-OH) are targets of Obama’s latest charm offensive:

President Barack Obama’s latest push for a bipartisan deficit-reduction accord that includes tax increases has a new focus: Rank-and-file congressional Republicans.

After saying March 1 at the White House that he would seek “a caucus of common sense on Capitol Hill,” Obama called about a half-dozen Republican senators to court their support for reducing the deficit through a mix of tax increases and changes to entitlement programs.

The calls represent a shift in approach for Obama, who in fiscal talks with Republicans since 2011 has negotiated mainly with Boehner and McConnell. Rank-and-file Republican lawmakers had complained that Obama didn’t try to engage with them.

SEQUESTER.  CBS reports the Obama administration is struggling to illustrate pain from sequester:

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History and Science Lessons for Pelosi and Obama

For supposedly progressive politicians, Rep. Nancy Pelosi (D-CA) and President Obama aren’t doing the best job of, well, progressing.  As both history and science march forward, they are stuck in the 1960’s.  Medicare was created in 1965, and since then, the average life expectancy of Americans has increased from 70.2 years to 79.5 years.

Things have changed.

We’re healthier for longer, which is why we are living for longer, but we can still start receiving Medicare benefits when we turn 65.  As a result, seniors collect benefits for almost three times as long as compared to when the program started.

So there’s your context.  Now listen to this gem from Nancy Pelosi:

Don’t you think … you ought to see if raising the age really does save money?  Those people are not going to evaporate from the face of the Earth for two years. They’re going to have medical needs, and they’re going to have to be attended to.

Yes, Nancy, we can agree on that!  Generally speaking, seniors don’t “evaporate” off the face of the earth.  It would be especially interesting if they developed the magical ability to do so “for two years” and then return. 

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