Skip to comments.Obama’s Damaging Admission: An item totaling 0.01% of the budget proves that Obamacare won’t work.
Posted on 04/17/2013 6:53:49 AM PDT by SeekAndFind
Buried deep within President Obamas $3.77 trillion budget is a tiny little proposal to increase Medicaid spending by $360 million. In a budget as large as this one, $360 million is scarcely worth mentioning. It amounts to less than one-hundredth of one percent of total outlays. But this 0.01 percent is worth mentioning, because it proves the presidents health-care law will not work.
1. The PPACA is not likely to reduce uncompensated care in 2014.
A central argument in favor of the PPACA was that it would end the hidden tax that uninsured individuals impose on the insured.
Supporters claimed that hospitals shift the cost of treating the uninsured to private insurers, which increases premiums for a typical family by more than $1,000 — a wild overestimate, but I digress. They argued that the PPACAs Medicaid expansion and health-insurance exchanges would extend coverage to some 30 million previously uninsured people, thereby eliminating that hidden tax and enabling Congress to reduce DSH payments.
The presidents budget shows that not even he buys that argument now. It states: To better align DSH payments with expected levels of uncompensated care, the Budget proposes to begin the reductions in 2015, instead of 2014. That is, the president expects that the Medicaid and exchange subsidies wont eliminate that $360 million of uncompensated care next year. And its not because some states are choosing not to expand Medicaid — he proposes to rescind the cuts even in states that are expanding it.
2. The PPACA wont reduce the deficit.
Rescinding the DSH cuts demonstrates why the health-care laws supposed deficit reduction is a mirage.
Washington has a bipartisan tradition of overspending in the current year while enacting spending cuts and tax increases that will take effect in later years. Those out-year measures make the ten-year budget figures appear more responsible than they would if current-year policies were continued. When the out-year spending cuts and tax hikes are due to take effect, Washington rescinds them, and the cycle begins again. Congress has postponed planned cuts in Medicare physician payments every year for the past decade. This year, Obama rescinded cuts the PPACA would make to private Medicare plans, and both parties are lining up to repeal the laws medical-device tax and the board it would create to reduce Medicare spending.
The presidents latest DSH proposal is a classic dessert now, spinach later ruse. To pay for this $360 million increase, he proposed cutting DSH payments by that exact amount in 2015 and 2016. He even proposed an additional $3.6 billion cut — in 2023.
3. Hospitals can stop crying poverty.
Hospitals, which lobbied for the PPACA, have been threatening that unless states implement the Medicaid expansion, the Medicaid DSH cuts will lead to layoffs and closures in their districts.
President Obama has rescued the hospital lobby from that self-inflicted wound. The hospitals can no longer use the Medicaid DSH cuts as their boogeyman, because now everyone knows the president will rescind this years cuts, and next years cuts, and . . .
4. States dont need to expand Medicaid to protect hospitals.
The Washington Post reports that rescission of the DSH cuts could make it a bit easier for states not to expand the Medicaid program. If they know the additional dollars are coming in, theres a bit less worry about turning down the Medicaid expansion funds. At the same time, the president has undercut expansion supporters by admitting that expanding Medicaid will not reduce uncompensated care.
The presidents budget shows that the brave state legislators who have been fighting the Medicaid expansion in states like Ohio and Florida were right all along — and it makes expansion supporters, like Governors Rick Scott (R., Fla.) and John Kasich (R., Ohio), look rather silly.
This relatively small spending item is a big admission that the presidents health-care law simply won’t work, and it should provide encouragement to state officials who are still resisting the massive increase in deficit spending, government bureaucracy, and health-care costs the PPACA embodies.
— Michael F. Cannon is director of health-policy studies at the Cato Institute and co-editor of Replacing ObamaCare (2012).
And the SCOTUS ruling in which Roberts rescued this unconstitutional legislation by calling it a tax also included a ruling that the federal government could not retaliate against uncooperative states by reducing Medicare payments to those states.
Shame on Scott and Kasich for caving when there was no need to capitulate to this naked power grab by the federal government.
True...unless Scott was not really caving....knowing that the Fla legislature would never approve it...and just using a tactic. IAM Not defending that tactic by the way, just pointing out that his situation may be totally different than Kasich's or Christie's.
Of course, most of us only neede .01% of our brain to prove it wouldn’t work....
Perhaps Republicans need to offer up a ten-yet budget in which all budget items are cut 100% after the end of the present fiscal year. Such a budget would have a huge 10-year surplus--far better than anything Democrats would or could propose. If the Democrats complain that such budget cuts are unrealistic, Republicans could point out that the percentage of cuts that would actually take effect in their budget would almost certainly be at least as great as the percentage that have historically tended to take place [i.e. zero percent], the cuts are no less realistic than those tendered by Democrats.