As I wrote yesterday, the President’s deficit reduction plan includes a non-trivial swath of Medicare and Medicaid cuts, including some cuts for public health and prevention, as well as means testing and higher co-pays for certain services.
We’re told that most of the cuts are to providers. In fact, the largest portion of cuts comes from a rebate by drug manufacturers, basically forcing the drug companies to charge lower prices for their sales to Medicare. I don’t think those will have the major effect that Robert Pear lays out here; drug companies can knuckle under or lose access to their most lucrative market. But it’s true that simply saying “don’t worry, these are cuts to providers” is a bit too cute, wrongly assuming that nothing in the health care industry is connected.
President Obama and some members of Congress assert that, in cutting Medicare and Medicaid, they can whack health care providers while protecting beneficiaries. But experts say it is not so simple.
Experience, they say, shows that some cuts in payments to providers hurt beneficiaries, as more doctors refuse to take Medicaid patients or limit the number of new Medicare patients they will accept. Hospitals curtail services. Beneficiaries may have more difficulty getting therapy services after a stroke, traumatic brain injury or hip fracture.
By contrast, the experts say, other cuts force health care providers to become more efficient, saving money for beneficiaries, taxpayers and the government.
It’s pretty hard to say which cuts will have this effect and which won’t, but because Medicaid reimbursement rates are already so low, it’s more likely that cuts there will have the effect of doctors just refusing to accept Medicaid patients. I’m not crying for doctors and hospitals – they make plenty of money – but the way to really force them to accept less is to expand Medicare and Medicaid, to make it such a big actor in the market that it cannot be avoided. That’s why Medicare buy-in or a public option saves money.
But under the current circumstances, while there are differences between some types of Medicare and Medicaid cuts, all of them have the potential for some impact on beneficiaries somewhere. John Nichols opposes them on the grounds that they will have deleterious effects for public health.
The president would have us believe that the cuts can be made by addressing “waste, fraud and abuse.” The reality is that cutting a quarter-trillion dollars from Medicare will undermine the quality of care for seniors and the disabled. The Alliance for Quality Nursing Home Care estimates that Obama’s approach would lead to $42 billion in cuts for post-acute care providers “placing patients, our workforce and local facilities at risk.”
The proposed cuts to Medicare and Medicaid will put new stress on the economy by making it harder to maintain hiring levels at the skilled nursing facilities that have been some of the real job creators in a period of layoffs and rising unemployment rates.
The proposed Medicare and Medicaid cuts place new stresses on working families, many of which are already struggling to care for elderly and disabled relatives.
And the proposed Medicare and Medicaid cuts will cause aging workers to think twice about retiring, thus reducing the number of openings for young workers [...]
America does not need less Medicare and less Medicaid.
America needs “Medicare for All,” along the lines proposed by the Healthcare-Now! movement.
I know that the move these days is to thank the President for forcing a discussion about tax fairness. And to be clear, there’s a veto threat sitting out there that says cuts to Medicare benefits cannot be passed without taxes on the rich that Republicans will never accept. But the trajectory of the conversation, with $320 billion in cuts after $500 billion from the Affordable Care Act, moves us toward the territory of cutting through the bone.