In 1997, President Clinton signed the Balanced Budget Act which sought to control Medicare spending through a sustainable growth rate (SGR) which fixed doctorÂ’s Medicare reimbursement payments to a set formula. But subsequent CongressÂ’ have overridden this formula each year without changing the existing formula.
As a result Medicare payments to doctorÂ’s are set to drop by 29.4% next year. It would take $400 billion to fix this problem and pay doctors at near market rates through 2019.
But instead of fixing Medicare doctor payments, Obamacare made an additional $233 billion in “market basket” and other doctor payment cuts. In 2009, Medicare paid doctors about 80% of what private health insurance paid. Under the Obamacare Medicare cuts, that number would decline to 57% in 2012.
Liberals believe these price controls can lower Medicare spending without affecting the quality of care Medicare beneficiaries receive. They are wrong.
If the Obamacare Medicare cuts actually happen, the administrator of Medicare predicts that 15% of all health care providers will be bankrupt by 2019. And in Health Affairs, Dr. Joseph Newhouse predicted:“…it is equally hard to imagine cutting only Medicare spending while spending by the commercially insured under age sixty-five continues to grow at historic rates, which would lead to a marked divergence between what providers are paid for treating the commercially insured relative to what they are paid for Medicare beneficiaries. This gap could jeopardize Medicare beneficiaries’ access to mainstream medical care.”
Obamacare also cut $145 billion from Medicare Advantage payment benchmarks. Over one in five Medicare patients are enrolled in the Medicare Advantage plans, which translates to 10.5 million seniors.
According to the Medicare actuary many of these seniors will see significant reductions in their Medicare benefits. Additionally, the cuts will cause Medicare Advantage enrollments to decline by 50% by 2017.
Then there is the Independent Payment Advisory Board which empowers 15 bureaucrats to make even more spending cuts.
The panels recommendations automatically become law unless Congress overrideÂ’s by a two-thirds majority vote. Medicare beneficiaries would have no administrative or legal process for challenging the boardÂ’s decisions.
Liberal Myth of the Week» Blog Archive » Obamacare already ended Medicare as we know it