CBO Quotes to Remember

Democrats liked to quote the CBO about PPACA. CBO did issue a judgement about PPACA saying it could save a 100 billion over ten years; however, these supposed savings keep getting chipped away. No one is really paying attention. Nor did the Democrats fully read the CBO opinion. They clarified saying that there was not enough good information and these are not full judgments because of the lack of information.

Here are some good recent writings from the CBO.

On budget predictions from 2010-2019-

A detailed year-by-year projection, like those that CBO prepares for the 10-year
budget window, would not be meaningful over a longer horizon because the
uncertainties involved are simply too great. Among other factors, a wide range of
changes could occur—in people’s health, in the sources and extent of their
insurance coverage, and in the delivery of medical care (such as advances in
medical research, technological developments, and changes in physicians’
practice patterns) —that are likely to be significant but are very difficult to
predict, both under current law and under any proposal.

Doc Fix-

CBO expects that the reconciliation proposal and the Senate-passed health bill would yield a net increase in $260 billion in budget deficits during the decade beyond 2019.

In effect, the majority of the HI trust fund savings under
H.R. 3590 and the reconciliation proposal would be used to pay for other
spending and therefore would not enhance the ability of the government to pay for
future Medicare benefits.

Next Payment Cut Looms!

Another cut is coming down the pipe. Will this one stick? I am not sure how willing the Federal Government, less CMS and MedPac, are willing to do what they set out to do. I think any frank understanding of the healthcare industry will show that payments are falling in order to prevent a spiraling increase in costs.
The plan cut is 6.1% overall Medicare cuts starting Jan. 1 2011. This cut will be on top of a planned cut in December, which will be a huge 23.5% cut. This is the dreaded Doc Fix, that the Democratic Congress politically put off so they could pass healthcare reform; however political wise a move, this continual impendence of making the tough decision makes individuals lose faith in the government’s ability to do solve problems. I do not think cutting payments is the right way to fix healthcare, but the Democratic leaders explicitly made plans to cut reimbursements so as to stay on track for healthcare reform (attempt to be on budget).
The overall problem needs to be a perspective change. Right now, government is attempting to attack more of the demand side, rather than the supply side. Information and understanding basic cost drivers are the essential fix to healthcare. Reducing payments only squeezes doctors and makes their life harder. If anything hurts doctors, it will probably hurt patients. What needs to be done is understand the basic inflation of costs associated with practicing medicine. Then translate that into margins and profitability. I am not calling for a new government regulation but more information needs to be provided so as doctors to patients make wise choices. A wise consumer always brings down costs and makes competition increase.
I think the healthcare system is so convoluted and lost that no one really has the time or capability to understand it. If something is complex and no one really understands the grand picture, then it will be expensive and continue to perpetuity until the information is there to increase buying power. It is simple economics.

http://www.modernhealthcare.com/article/20100712/MODERNPHYSICIAN/307129981/-1