Fiscal Fraud of Obamacare Snowballing Already

Fiscal Fraud of Obamacare Snowballing Already
Terry Jeffrey
Wednesday, June 02, 2010

Remember the health care issue? Well, the fiscal consequences of the socialized medicine scheme enacted by President Barack Obama and Congress just two months ago are already beginning to snowball.

Democratic Rep. Henry Waxman of California, the chairman of the House Committee on Energy and Commerce, was one of the key architects and advocates of Obamacare. He was back on the House floor on Friday delivering an urgent plea to fellow Democrats that inadvertently -- or, perhaps, unavoidably -- revealed the fraudulent nature of our new national health care regime.

It was supposed to save the taxpayers money, remember?

"This legislation will lower costs for families and for businesses and for the federal government, reducing our deficit by over $1 trillion in the next two decades," Obama said when he signed the bill.

On Friday, Waxman declared that the sky is about to fall on the Medicare system. He went to the House floor to "urge" his colleagues to vote for a bill that includes $102 billion in new federal spending and would add $54 billion to the national debt over the next 10 years -- $25 billion of it in the few months remaining in this fiscal year.

Why did Waxman believe this new borrowing-and-spending was necessary?

"It's absolutely critical to do this if we are going to keep doctors in Medicare and keep the promise to Medicare beneficiaries that they will have access to physicians' services," said Waxman. "This provision will provide a moderate increase in physicians' fees, 2.2 percent for the rest of the year. If we don't act, doctors' fees will be cut by 21 percent from where they are today. This would be unconscionable."

It would not merely be unconscionable. If the 21-percent cut in Medicare fees for doctors -- that, in fact, legally took effect on June 1 -- is allowed to stand, many doctors in this country will simply stop seeing Medicare patients. They will not be able to afford it. The cost to them of serving their patients will exceed what they are paid. Their profit margin will be swept away.

To make precisely this point, 12 national surgeons' associations -- including the American Association of Neurological Surgeons, the American Association of Orthopedic Surgeons and the American Academy of Otolaryngology-Head and Neck Surgery -- sent House Speaker Nancy Pelosi a letter last Wednesday warning her what would happen if Medicare doctors' fees are slashed as they are scheduled to be under current law.

"These continued payment cuts, rising practice costs and a lack of certainty going forward, make it difficult, if not impossible, for already financially challenged surgical practices to continue to treat Medicare patients," the surgeons' associations told Pelosi.

The letter pointed the speaker toward the results of a survey of more than 13,000 physicians done in February by the Surgical Coalition, a group of more than 20 medical associations. The survey asked these doctors what they would do if Medicare fees were slashed by the scheduled 21.2 percent.

Twenty-nine percent said they would opt out of the Medicare system entirely. Almost 69 percent said they would limit the number of appointments they would take from Medicare patients, 45.8 percent said they would start referring complex Medicare patients to other physicians, 45.3 percent said they would stop providing certain services, 43.8 percent said they would defer purchasing new medical equipment and 42.7 percent said they would cut their staff.

Almost 4 percent of the doctors said they would close or sell their practices.

Why did Congress plan to slash the doctors' Medicare fees in the first place? It didn't. In the past, the majority in Congress has routinely enacted budget bills that fraudulently assumed that on some future date the federal government would dramatically slash the Medicare fees paid to doctors, knowing that before that date arrived the majority would pass "emergency" legislation postponing the cuts to some still-future date. The majority in Congress does this so the long-term deficits caused by their spending bills appear to be smaller than they actually are.

As originally proposed, Obamacare would have ended this practice, permanently setting Medicare reimbursement rates for doctors at the true anticipated level. But the Congressional Budget Office determined that doing so would have added $208 billion to the cost of Obamacare over 10 years, forcing the CBO to declare that Obamacare added to the deficit rather than reduced it. That would have cost Obamacare votes on the House floor and quite possibly defeated the legislation.

So the congressional leadership stripped the "doc fix" out of Obamacare and left it to another day.

Waxman went down to the floor last Friday to declare that day had come. Unfortunately, for him, the Senate had already left town for its Memorial Day vacation. So, the current fix will have to wait until it returns.

Even then, the fix only accounts for $22.9 billion of the $102 billion cost of the bill the House did pass on Friday. Most of the rest of the money is for extending unemployment benefits and special targeted tax breaks.

The $22.9 billion fix for the doctors' fees -- if passed by the Senate -- would only last through September 2011. Then Congress will presumably do it all again -- or let the Medicare system collapse.

In the meantime, Obamacare is supposed to cut half a trillion in spending from elsewhere in Medicare, while Obama's budget -- not counting the $54 billion in new debt included in this bill -- is expected to add $9.8 trillion to the national debt over the next 10 years.