Monday, December 19, 2005

The price of tax cuts

The Conference committee budget cut bill agreed to includes substantial cuts to programs aimed at low income families.

Cuts in Medicaid will require higher co-payments and lower benefits to poor people on the program. Now, I realize that everyone in America, even if they have insurance, are now seeing higher co-payments and lower benefits. And in that context, it is worth noting that the 'managed care' plans we have now ARE the Republican answer to the Democratic proposal for Universal Heathcare in 1994. However, the failure of the GOP model should not mean that we will now penalize the poorest of Americans, in one of the few programs where people CAN avoid having to worry about changing their doctor or being turned away for healthcare due to lack of coverage.

Higher benefit cuts in the area of 'asset protection' for middle class people who want nursing home care than were in either the original House bill or the original Senate bill. 'Asset protection' allows people to have something left they can pass on to their families even if they need long term health care.

For example, one provision of the House bill that appears to have been retained in the conference report would penalize many non-affluent individuals who make modest gifts to relatives or contributions to charity, and then experience an unexpected decline in their health several years later that causes them to need long-term care. So, if for example, your parents gave you some money last year, or made a donation to Hurricane Katrina relief or tsunami relief, and then in a few years they get sick and need nursing home care, they will be asked to give that same money to the nursing home, or what is spent on their care will decline commensurately. This makes clear that the people who are always going on about how bad inheritance taxes are (they prefer to use the term, 'death tax') want to make sure that if you are middle class and have a lingering disease, no you won't have anything to pass on-- the nursing home will get it all (and it makes it clear that the position of the Bush administration opposing the Oregon voluntary euthanasia law is actually quite sinister-- it almost seems as though it is their INTENT to make sure that every penny that can be stolen from the middle class and redistributed to corporate interests is taken-- even if it means forcing terminal patients to suffer for years until every penny they have ever earned is snatched away by health care providers.)

The conference agreement includes Medicaid reductions in this area of $2.4 billion over five years and $6.4 billion over ten years (higher than the $2.2 billion over five years and $5.8 billion over ten years in the House-passed bill). The Senate’s more targeted and carefully designed provisions in this area would have produced savings of $335 million over five years and $890 million over ten years.

There were some winners in the budget bill, however:

The conference report’s health care provisions also move toward the House bill in another respect: they cater to powerful special interests — in particular, the pharmaceutical and managed care industries — at the expense of low-income beneficiaries...

The conference report also protects Medicare managed care plans. It drops a Senate provision that would have eliminated a wasteful $10 billion slush fund to encourage participation in Medicare by regional Preferred Provider Organizations (PPOs). The Medicare Payment Advisory Commission (MedPAC) — the official, independent advisory body to Congress on Medicare payment policy — recommended this summer, in a nearly unanimous vote, that this fund be eliminated because it is unnecessary and unwarranted and provides an unfair competitive advantage to PPOs over traditional Medicare fee-for-service and other managed care plans such as Medicare HMOs. Nevertheless, the conference agreement leaves this fund fully intact.

This is the provision by which PPO's are paid to be willing to accept other government money that comes via Medicare. A payment to be willing to get paid. But this remains intact.

Partially gutting another provision to curb overpayments to managed care plans: There is near-universal agreement among analysts that the current Medicare payment structure provides excessive payments to managed care plans, and the Administration announced earlier this year that it would act administratively to eliminate a feature of the payment formula that is responsible for a significant volume of excessive payments... it appears that the conference agreement is written so the part of the Medicare payment formula that would be reformed would revert to its current, problematic status after five years, and after that time, managed care plans would again receive the overpayments this provision is supposed to curb.

Outright overpayment to some healthcare providers, and they can't even permanently eliminate that. I wonder if there is also a line in there somewhere for continuing to fund fraud.

Other cuts included in the bill include cuts in child support enforcement (obviously lobbying for the votes of deadbeat parents), welfare-to-work programs (I guess because they have been so successful, they no longer have enough 'welfare queens' to beat up on so they need to create a new generation of them to support right-wing rhetoric), child care funding, SSI disability payments, and foster care funding.

Maybe that is why the House leadership was forced to change the rules and release, let members study and vote on this monster in four and a half hours, between 1:12 a.m. and 5:43 a.m. this morning.

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