Truth and Consequences
Mar 1st, 2010 | 72 responses
Brian Beutler reports on the consequences of the 21% cut in Medicare payments to doctors that takes effect today:
The American Medical Association warned of this last week: “A Medicare meltdown now seems certain, as the U.S. Senate has left early for the weekend, abandoning seniors, military families and baby boomers,” reads an AMA statement from Friday. “The Senate failed to repeal the Medicare physician payment formula that will cause a drastic 21 percent payment cut to physicians who care for Medicare and TRICARE patients. On Monday, the 21 percent cut goes into effect, forcing many physicians to limit the number of Medicare and TRICARE patients they see in order to keep their practice doors open.”
Before they left early for the weekend, Democrats in the Senate were trying to pass a temporary extension of the funding for these Medicare benefits, as well as for unemployment benefits and COBRA coverage for millions of unemployed Americans. Sen. Jim Bunning (R-KY) was asking the Democrats to explain how they would pay for the temporary extension. He did not think it was a good idea to pass the extension if it was not paid for. (Former Pres. Bush had passed two tax cut packages and funded two wars without explaining where the money was coming from, and Sen. Bunning did not think it was a good idea to do that again.)
Sadly, the Democrats refused to tell him. So Sen. Bunning decided that in all good conscience he could not permit the extension to be passed, although the funding in it was needed to help Americans who had lost their jobs and could not pay for food and other essential expenses, and despite the fact that he was the only one who opposed the extension. Bunning’s fellow Republicans begged, pleaded, and cajoled, but he just would not listen to reason. The Democrats, being the majority in the Senate, could have forced Bunning to stop withholding his consent when the Democrats asked for unanimous consent to pass the extension, but whether out of malevolence or incompetence, they didn’t. And now look what’s happened as a result of the Democrats’ reluctance to physically remove Bunning from the Senate chamber or at least put several thicknesses of duct tape over his mouth:
On a conference call with reporters this afternoon Rep. Chris Van Hollen (D-MD) put it this way: “By his actions, Bunning has prevented people from receiving Unemployment, health care access, transportation projects from going forward, and Doctors who provide Medicare services from getting paid.”
Today, for the seventh time, Bunning objected to a request for unanimous consent to temporarily extend benefits. In addition to cutting doctor’s fees, his exploitation of the Senate’s filibuster rules has cost thousands of out-of-work Americans their benefits and has even put thousands of federal employees out of work.
Look, it was silly and maybe even mean of Sen. Bunning to do this, but the Republicans did everything they could to get him to change his mind, and they just could not. The Democrats, by contrast, refused to make him change his mind, and now we have a big huge mess.
This is what happens when the Democratic majority plays partisan politics.
72 Responses to “Truth and Consequences”
A good point expressed in a heinous, loathsome and indefensible manner. Bunning is causing untold, long-lasting suffering with his idiotic grandstanding and he is lucky there is no reason for hell to exist.
I doubt the “challenged” and hypocritical Faithful Herd will, even now, grasp the implications of the Dems' “reform” plan to take money out of Medicare. So very easy, and yet with them so very hard…
A good point expressed in a heinous, loathsome and indefensible manner.
And on purpose, too.
The author wrote:
but the Republicans did everything they could to get him to change his mind, and they just could not.
LOL. You're kidding right? McConnell wanted this done and made a nice visual gesture of trying to talk him out of it. You don't suppose they offered him his cash for his re-elect? McConnell wanted to make a point and there's no better way than to put out a sacrificial lamb whose not up for re-elect. Your'e actually trying to get me to believe that Bunning's hold was OVER the objections of Sen Minority leader (and fellow Kentuckian) Mitch McConnell? Wow, that's naive.
I can almost guarantee this will be taken the wrong way… but…. has anybody considered that the reason there's been a health care reform logjam forever is because things just weren't broken enough? Myself, I suspect the fall-out here (if allowed to play out at all) will be epic, and will break the dam.
Also: anybody care to discuss where that mandatory cut to doctors came from in the first place?
So interesting that Dems would decry non-passage of the Doc-fix, while advancing a bill with twice the dollar amount of the Doc-fix in cuts.
Heh, guess they won't be able to demagogue that as “evil Republicans cut Medicare,” though.
Can't say I have much sympathy for the AMA and their self-serving dire predictions, though I understand that no one likes a pay cut.
As for the rest, this is typical behavior from our political elites who act more like buffoons than elder statesmen.
Polimom–
Lately, I've been thinking the same thing–that things aren't bad enough.
Also: anybody care to discuss where that mandatory cut to doctors came from in the first place?
Polimom it's a long story (and bipartisan) that dates back to the Gingrich congress During an overhaul of Medicare Congress came up with the idea of SGR (sustained growth ratio) whereby if medicare expenditures grew too fast then physicians payments would be cut. I believe this reasoning was that this would encourage to hold down costs.
Anyway Medicare continued to grow and the time came for payments to be cut. Since medicare payments are already heavily discounted, Congress has always been afraid to cut payments since physicians might not see medicare patients any more. What has been happening is that every year Congress would swoop in at the last minute and postpone the payment cuts but not fix the original SGR plan.
This became a handy way to help balance the budget. A budget would be passed assuming a payment cut, then later Congress would postpone the pay cut.
Now since the SGR has never been fixed, the cut is up to 21%. What is funny is that the 21% pay cut is in the Democrat's health care bills as a way to make it look deficit neutral. Of course they have no intention of actually cutting payments – they'll just fix it later after the bill is passed.
Any Democrat criticizing the 21% payment cut is essentially criticizing a critical budget element of their own health care bill. This is why I have said repeatedly the “deficit-neutral” aspect of the bill is bogus – they include the payment cut to make it look good then plan on reversing it later.
Thanks, DaGoat. You summarized nicely. I'd only add that (I read) there was a quirk in how they figured the initial payments, and doctors received increases they shouldn't have for the first four years, thus skewing the equation further.
“What is funny is that the 21% pay cut is in the Democrat's health care bills as a way to make it look deficit neutral. Of course they have no intention of actually cutting payments – they'll just fix it later after the bill is passed.”
Yes. Bingo. Thank you, DaGoat.
“Any Democrat criticizing the 21% payment cut is essentially criticizing a critical budget element of their own health care bill.”
I thought that sentence was worth pulling out, separately, just for emphasis.
Would any of the supporters of the Dem HCR plans care to comment on whether or not you think the 21% cut to doctor reimbursements should take place in the future, as is written into the legislation?
If so, why will it not be a crisis when that happens just as it's being described as a crisis now?
And if your response is no, that at that future time the planned cuts should be rescinded and reimbursements should continue to increase, then are you aware of how that will affect the costs of the bills?
The silence on this thread is deafening.
Yeah (though I'll give benefit of the doubt that some people may respond later, we'll see.)
When you read the comment thread at the TPM link it's quite clear that the partisan Dems there are not even aware of this conundrum (it's all about how heinous it is for Bunning to have forced this cut to take place, without any self awareness that they're promoting legislation that will either do the same thing or will cause budgetary implosion down the line.)
Here's some good background on the evolution of that 21% cut:
http://ww.npr.org/templates/transcript/transcri…
You'll have to start back in the 60's though…
See, JSpencer, that link (thanks, btw) absolutely epitomizes why I — and many other people — are not at ALL comfortable with the tinkering around the Congress is doing with their health care bill. They haven't got a doggonned CLUE what they're doing. And they never did.
And I'm still confounded by the outrage being voiced in this initial post. Do supporters of this bill not realize that the payment cuts have been factored into the budget projections they've been waving in everybody's faces?
I'd guess they don't realize it. Although to be fair to them, I think the actual situation is that the Senate bill is silent on the doc fix. So technically, it's not part of the bill and when they fix it later, that will be an entirely separate matter that has nothing to do with HCR. Now you might think that this means that as a matter of policy, the propose ending it, but that's because you are falsely confusing Medicare reimbursement rates for doctors with health care reform. You see, health care reform is about extending coverage and addressing the evil insurance companies. Payments to doctors is an entirely different subject.
And on the broader point, does anyone else think that maybe Bunning has a legitimate point (addressed in a silly way) in saying that the first time the new statutory PAYGO rules would bind the Congress, the Congress chooses to set them aside. What was the point of passing it in the first place then?
The silence on this thread is deafening.
In fairness this whole SGR issue takes a while to wrap your brain around. I've been following it for years and it still is kind of confusing.
Kathy, with all due respect, I think you mixed up the pink pills with the blue ones. Bunning has a very selective conscience when it comes to fiscal responsibility. The chickenhawk never objected to $400 quick billion for his buddies at the banks, nor hundreds of billions for his sponsors in the arms business funding the trumped up war in Iraq. But when it comes to working people down on their luck, all of a sudden he has a” conscience”. Please……………….
Polimom,
They didn't know what they were doing in the 1960's, but they did it anyway because they knew what was best for us . . . .
When they discovered it was messed up and tried to fix it, they couldn't–those who benefited from it the way it was originally created would not allow it.
They don't know what they're doing in 2009-2010, but they're going to do it anyway, because they know what is best for us . . . .
And if the way it is passed initially has problems, don't worry, they'll fix it in a couple of years . . . . .
Sigh . . . . .
Democrats don't advocate cutting doctor's payments by 21%. They just want to pass it separately, for a perfectly legitimate reason: http://www.guardian.co.uk/world/feedarticle/881…
So you see, it makes perfect sense. There's nothing to be concerned about regarding this or the many other ways that the Democrats crafted the bill to take advantage of the rules the CBO must use to score the bill.
Does it scare anyone else that this whole mess with the “doc fix” began because we created a rule that arbitrary capped reimbursement at such as unrealistic level that politicians had no choice but to continuously overturn the cap every year? And we're going to do the same thing again. According to the CBO: http://www.cbo.gov/ftpdocs/106xx/doc10688/hr396…
CS and Polimom, despite your smug comments about the silence of liberals like me think our system needs major change, not just tinkering. As steveinch said -thanks steveinch- that 21% reduction is NOT in the bill. The Senate bill is a clumsy tossed salad, some needed changes perhaps, but far different than what those of us on the left want. The simplest fix for our health care mess, and the most effective, is to simply open Medicare to all. That is, OPT in to PAY for Medicare coverage, at any age.
I've documented the savings too many times to do it again. The combination of WAY lower overhead and large savings on provider payments is over 30% v.s. private insurance, plus is everything most people want – portable, non-discriminatory, no cancellation, no pre-existing condition denials, no bloated claims denial department, no fat cat salaries or company planes and cars, no marketing department, new product development, none of our money used to bribe legislators, no cruises or exotic resort junkets. None of these things provides a scrap for actual health care.
Anybody care to discuss the relevance of having such a discussion now, when the extension Bunning blocked included a fix to RESTORE that funding?
Saladdin. Sighhh. My post is SATIRICAL. And I'm actually trying to get myself to believe that anyone who's read more than two of my posts could possibly think this post here is anything but satirical.
Really discouraging.
In that case, I hope you're not one of those who oppose universal health care because the doctors would get less money. I've heard that argument from opponents of universal health care.
Donaldopeoples, my post was satirical. Anyone else need to be told that my post was satirical? I'm ready to issue as many soft clucking words of reassurance as I need to.
GD, thank the Lord above for you.
Anybody care to discuss the relevance of having such a discussion now, when the extension Bunning blocked included a fix to RESTORE that funding?
Yes. The relevance is that it's politically impossible to ever reduce the doctor reimbursements to the level that they need to be in order for the HCR policy to lead us toward cost sustainability. Some of us aren't willing to allow Congress to use smoke and mirrors to pretend that they're bending the cost curve, when what they really do is write legislation that relies on changes later which will never happen.
Quite the contrary. I've said many times that it's not possible to get costs in line and keep paying providers (not just doctors) what they're currently paid. I don't have any ideological problem with universal coverage, I just think it's less important than cost containment.
That's really the issue for me. If this Congress can't make medicare cuts now what makes anyone think the Congress in 2014 or 2018 will make those cuts? Kicking your cost savings/revenue measures to a future Congress is just a deceptive method to get the benefits of spending without the political costs of getting the revenue to pay for it. This is what Congress (and both parties) have done for over a generation and look what it's done to our national balance sheet.
I don't see why we can't regulate doctors fees as part of HCR. It isn't like doctors are going to go anywhere else. It isn't like we can't import very skilled doctors from other countries…where they get paid 20% of what a US doctor gets.
US doctors have it REALLY good. Reduce their fees….add in some tort reform to knock down their liability. It is doable…and they won't move to Iceland.
Shannon,
My understanding is as follows.
1. The SGR (doc payment rate declines) remains the law of the land. Congress has refused to repeal it because it would cost (according to the CBO) hundreds of billions of dollars over the 10 year scoring period.
2. Instead Congress has passed fixes to the SGR one year at a time without changing the underlying law. How they can do this with a straight face is beyond me but they do the same thing with the AMT so I guess I should expect it.
3. The Senate bill is silent on doc payments, meaning it implicitly assumes that SGR will apply in the future and therefore doctor payments will be much lower than they are today.
4. Almost everyone (even most liberals) believes that Congress will continue to “patch” the SGR in the future. As a consequence, the real cost of health care over the next 10 years will be higher than is estimated in the CBO analysis of the bills.
The point people are making is that payments to doctors should be an integral part of health care reform and that the bills under consideration are intellectually dishonest because they assume something that the crafters of the bills have no intention of allowing to happen. One can make a softer but still to my mind pretty compelling case on the same type as it relates to future Medicare cuts coming from the IMAC and this is where all of the second decade “savings” come from.
Thanks for providing that explanation.
It's really the same thing that was happening with the Alternative Minimum Tax (AMT) for years and years. I think it finally got a permanent fix with the ARRA legislation (they figured, I guess, that with a huge emergency spending bill they could get finally pay for the lower tax revenue going forward by bundling it with the other stimulus spending.) But what was happening is that budget projections were always based on the false premise that millions more taxpayers would fall into the AMT tax structure, while in reality every year Congress passed a 'patch' which kept those additional households from paying the higher taxes.
I don't think I've seen physician salaries as low as that in EU nations (20% of US salaries?) but it's true that physician pay being lower and that this is part of the cost difference between here and there.
But, if I'm not mistaken in some of those cases…Switzerland in particular…the govt got buy in from physicians by paying for their education. Since most of our doctors come out of med school with six digit debt, that would make a huge difference.
It's not so much that doctors will 'go anywhere' (although that's a problem too since reimbursements vary by region and doctors will flock to urban areas if further cuts are made) but more importantly, we'll see med school apps drop if people can't count on high income to offset the high cost of getting a medical education and even if the overall number of applicants remains high enough to fill all of the available slots we'll have increasing problems with the graduates choosing specialties instead of FP (which is already a big problem.)
I agree, it's not fair to criticize people for not responding immediately (that's why I said I'd give the benefit of the doubt.)
Still not seeing much in substantive responses this morning though
Actually, the AMT fix is only in the ARRA for one year. The patch will have to be redone in the future
<Actually, the AMT fix is only in the ARRA for one year. The patch will have to be redone in the future.
Oops, they did it again, huh? Blechhh…it's hopeless.
Also shannon, there's two ways of looking at whether or not a given policy is 'possible'. There's the theoretical possibility of whether or not the policy will have the desired effects without negative unintended consequences (on the doctor fix, the question is whether or not the proposed cuts are so drastic that they'll affect supply.)
But there's also the political possibility of passing the policy, and the AMA lobby has obviously been preventing that for years and years. I don't see any reason to think that's going to change.
I've seen data (Google physician salaries by country) that says that GP/FP salaries are roughly 50% of US levels in Europe and lower in some Asian countries.
This salary disparity, as I understand it, is larger in specialized medicine and somewhat smaller for nurses and other medical personnel. It is a large driver of the difference in costs across countries.
To the extent that you move compensation down, there are likely two effects. First, fewer people will choose GP/FP as opposed to specialist. Second, total number of docs will decline. Over time, med school costs will probably decline as well but I imagine there would be quite a lag.
Thanks for the post. I understood the SGR concerns for government funded health care. I also see the same problem when doctors make the same agreements with HMO's and PPO's. The big problem here is that if something isn't done, doctors stop seeing Medicare COBRA patients….which is already a problem for people with private HMO's.
My disagreement is here
“intellectually dishonest because they assume something that the crafters of the bills have no intention of allowing to happen”
HCR does not happen and cannot be funded without these cost reforms that we can implement without hurting our health care system. I think most people understand this…could be wrong.
Indian doctors are very good and don't get paid much….that is who I was thinking of with the 20%.
I agree that there will be a salary balancing act. We still need to reward people for going through all of that schooling. And yes, a lot of European countries cover all education costs….my wife was actually paid a salary to completely her Dr rer nat work.
“HCR does not happen and cannot be funded without those cost reforms that we can implement without hurting our health care system.”
The law says that doctor payments will go down as a consequence of the SGR. That same law has been ignored every year since it was passed. There is no reason to assume it will bind in the future. If it does not bind in the future, HCR will cost more than it is currently projected to cost.
I'll bet you a deep dish pizza the SGR is ignored in the future.
For some reason the reply to isn't working anymore….at least not for me
SI…
I'd take that bet if HCR would pass. As things stand now…SGR will be ignored until the end of time
Here is my problem….
I don't like a lot of what is in the current Senate bill, but it is all we have. If we start from scratch, nothing will get done. We won't touch HCR until the next Dem Pres rolls around.
I believe that if doctor's salaries decrease then med school costs will too. I also believe that it would definitely be a good thing if doctors got paid less, as it would eventually change the culture. I know I've harped on this before and am going to again take the non-PC stand that I believe that one of the major pillars that is rotten is the culture of doctors themselves. I'm getting more and more involved in this and..my god…the horror…the horror. I believe a large part of the problem is that most of the people attracted to the profession (and definitely the establishment) is there for money and status as opposed to passion about helping people. This has the side effect where most doctors lack critical thinking skills. I used to think that maybe a lot of my view was clouded by researcher envy, but all the research physicians I've talked to are far more extreme in their descriptions than I'd ever imagine.
It's to the point where I'm working on some very very cool things that could help a ton of people and save uh, a lot of money, but some people are questioning whether it's wise because if used incorrectly it could make things even worse and they don't believe that it will be used critically. I'm not sure what to say to that, other than that we're damned if we don't try. Of course if things don't change then I've have helped unleashed an even bigger beast..so that's fun.
>>The Democrats, being the majority in the Senate, could have forced Bunning to stop withholding his consent when the Democrats asked for unanimous consent to pass the extension, but whether out of malevolence or incompetence, they didn’t.<<
Can you expand on this? This isn't about a filibuster, is it? It looks like different rules are in effect.
I reload when I can't get reply to come up. Sometimes it works.
As to the substance of your post, I think you are making a rather large mistake. The chances of something better getting done are higher if we do nothing than if we pass the Senate bill.
Think about the politics for a moment.
If we pass the Senate bill, the Rs will continue to attack it and the Ds will have to defend it as a paragon of virtue. As a consequence, the impetus for change will come from the Rs and will be about “rolling back” the bill.
If we don't pass the Senate bill, further impetus for reform will exist and may come from both parties, therefore making it more likely that something will happen.
For people happy with the Senate bill as an end state, the calculus is different. For those unhappy with it, what I say above I think holds logically.
IMO, the actual logic for passing the Senate bill now is in two parts. One, we need to do something because we don't want to go back to our constituents empty handed, Two, the Rs are against the bill and we can't let them win. There are some Ds who are saying we'll do more later but they are mostly single payor advocates who don't understand reality.
Let's be clear, once the bill passes, if it passes, the government is going to be seen as responsible for every cost increase in health care. Since health care spending is going to continue to increase, it will now be seen as the government's fault. That will make a move toward more government control (e.g., single-payor) absolutely impossible.
Of course, the drums are saying the President is going to propose “something different” tomorrow so maybe that will change everyone's calculus yet again
“I'm working on some very very cool things that could help a ton of people and save uh, a lot of money”
Do tell….if you can.
“The chances of something better getting done are higher if we do nothing than if we pass the Senate bill.”
Although I suspect we disagree on what should be done, this statement kinda goes with my thinking that the system just isn't broken enough yet for real reform.
ElZ,
I'll try to explain as best I understand it.
To speed things up in the Senate, Senators often ask for unanimous consent meaning everyone agrees to do things. Sometimes, that's something like agreeing to consider a bill without reading it. Other times, it's agreeing to allow somebody to speak for more time than they were officially allocated.
At that point, any Senator can object, that is, refuse to consent. At that point, you can vote to do what you wanted to do anyway but you need 60 votes to do it. So I actually disagree with the point you quoted. The Dems alone could not have forced Bunning to relent but with one Republican, which they surely could have gotten, they would have been able to do so.