Doc shock, stage 2: Medicare and Medicaid cuts drive doctors away
The exposure of Barack Obama’s Big Lie about keeping your beloved old insurance plan gave us cancellation shock. Soaring ObamaCare premiums gave us rate shock. The collapse of provider networks brings us the third horseman of the Affordable Care Act apocalypse, “doc shock.” And that’s about to get a lot worse, because Medicare and Medicaid reimbursements are scheduled for huge 24 percent cuts. Good luck getting to see a doctor with your “free” Medicaid coverage.
These are the reimbursement cuts that have been postponed with “doc fix” legislation, time and again. It might not be possible to hold the cuts off any longer. And as Merrill Matthews explains at Forbes, ObamaCare fused Medicaid and Medicare rates together, so we could have a “double whammy” coming our way:
Medicaid pays doctors about 59 percent of what Medicare pays them—which is why doctors increasingly refuse to take new Medicaid patients. As I pointed out last week, the Centers for Medicare and Medicaid Services (CMS) recently released a documentshowing that 9,500 doctors who had previously accepted Medicaid patients refused to do so in 2012.
In an effort to gain—some might say “buy”—physician support for Obamacare, drafters required Medicaid programs to pay doctors the same rate as Medicare for 2013 and 2014—and that’s all states, not just the ones expanding Medicaid. (I am told that some states have yet to pay the additional 2013 Medicaid reimbursements, claiming they will do that retroactively in 2014.) So if Congress doesn’t pass a Doc Fix and Medicare rates go down by 24 percent, then so will Medicaid.
Together both programs cover more than 100 million Americans, and the government expects about 9 million more people to join Medicaid next year. More people wanting care and lower reimbursements for seeing them.
Angering seniors during an election year is electoral suicide, so maybe the we’ll see another “doc fix” to keep reimbursement rates up. That’ll add another $140 billion to the deficit for a ten-year fix, according to Congressional Budget Office projections. Matthews wonders if a quickie band-aid fix for just long enough to get past the election might be in the works. Since ObamaCare has effectively become the Keep Democrats From Getting Wiped Out By Any Means Necessary Act, that wouldn’t be a surprising development.
Speaking of which, today’s dubiously legal mutation of ObamaCare involves the White House unilaterally deciding to suspend the sequestration cuts to ObamaCare, in order to keep subsidies for out-of-pocket costs flowing to low-income families. We can’t let them discover just how unaffordable the “Affordable” Care Act is right before an election, right? And the money goes straight to Obama’s Little Partners in the insurance industry. Ka-ching!
We’re probably not far away from a harsh national lesson in the high cost of “affordable” health care, which King Barack will not be able to hide with a few passes of his imperial baton. Rep. Mike Kelly (R-PA) of the House Ways and Means Committee noticed that President Obama’s budget proposal very quietly calls for “additional revenue to maintain our commitments to seniors,” which means “huge tax increases” in plain English. He ran this by HHS Secretary Kathleen Sebelius, who mumbled something about closing tax loopholes. Kelly says that’s not going to get the job done:
We are playing ring around the rosy with this. There is no way that we can look at the metrics of this and say this is going work. … The real choice right here is between entitlement reform or going to some other type of a tax, which I think a lot of people on the right and left are going to have to have to have a European-style VAT tax. This is going to put a tremendous burden on the middle-income folks, the lower-middle-income folks, and the lower-income folks because it hits every one of them, hard. Nobody walks away from this. Forget all the subsides and everything else. I want to know, where are you going to get the money? Show me the money. If there is not going to be reform, show me the money. Where is the revenue going to come from? Because we know in this model, you tax it, you fine it – it’s through taxes fines, fees, or borrowing, or – God forbid – just printing our way out of it. So where’s the money going to come from?
If “doc fixes” are politically impossible, then either taxes go up, or Democrats start auctioning off chunks of their beloved mega-government to pay for their health care commitments. The latter scenario is going to happen anyway, of course; in twenty or thirty years, all of today’s discussions about budget priorities will sound absurd to young people entering a job market where entry-level workers pay 70 percent tax rates, and virtually all of the money is used for entitlements and debt service. ObamaCare, and indeed the entire Obama presidency, are a fast-forward to dark times that we might otherwise have held at bay for another decade, or maybe even avoided with intelligent reforms. But in the meantime, Democrats will use the weight of their own wildly irresponsible spending as leverage to squeeze more taxes out of the American people, maybe even the VAT tax nightmare Kelly describes.
Because if they don’t, they’ll face an absolutely livid electorate in 2016. Angry voters will throw virtually useless Medicaid policies into the faces of Democrat politicians at town hall meetings, while the horror stories about doc shock grow beyond the combined ability of every left-wing hack on the Internet to obscure them. As bad as the rest of ObamaCare is, doc shock is the crisis it cannot survive. President Obama has taken to telling people they can drop their cable TV and cell phone services to scrape up the money it takes to pay for his ridiculously overpriced insurance, but there’s no way to make them feel better about getting turned away at every decent practice and clinic in town.
And just wait until the states that accepted ObamaCare’s Medicaid expansion start getting the bill for their share of the program, which has grown far more expensive than early, absurdly optimistic predictions. The high cost of avoiding “doc shock” is two years away from landing in the laps of state officials who thought they were signing up for a free lunch…