Tuesday, November 17, 2009

Conservatives aren't the only ones worried about health care costs

The left keeps claiming that "Health Care Reform" will lower the cost of medicine for everyone. They plan to do that by lowering Medicare payments. I'm sure that will go over really well with doctors, who already feel very underpaid and make it up by over billing private insurance.

The claim that Pelosi's bill, or any of the bills they've considered so far will lower costs is a complete fabrication. Anyone checking the numbers responsibly will report that fact. Now our chief creditor, China, is asking pointed questions, too.

James Pethokoukis' column "China questions costs of U.S. healthcare reform":
Boilerplate assurances [to the Chinese] that America won’t default on its debt or inflate the shortfall away are apparently not cutting it. Nor should they, when one owns nearly $2 trillion in assets denominated in the currency of a country about to double its national debt over the next decade.

Nothing happening in Washington today should give Beijing any comfort or confidence about what may happen tomorrow. Healthcare reform was originally promoted as a way to “bend the curve” on escalating entitlement costs, the major part of which is financing Medicare and Medicaid. That is looking more and more like an overpromised deliverable.

For instance, a new study from the U.S. government’s Centers for Medicare and Medicaid Services finds that the healthcare reform bill recently passed in the House of Representatives would increase healthcare spending to 21.3 percent of GDP by 2019 compared with 20.8 percent under current law. That’s bending the curve the wrong way. The study also questions the “long-term viability” of the $500 billion in Medicare cuts meant to help pay for expanded insurance coverage.

In addition, the CMS study gives a clearer cost estimate than the one provided by the Congressional Budget Office. According to the CBO, the 10-year cost of PelosiCare is $894 billion. But that analysis includes early years with little government spending, According to the CMS, the House approach would cost $1 trillion from 2013-2019, or some $140 billion a year when fully put into effect.

Few realists in Washington think any of the current reform plans make a significant dent in the long-term healthcare cost to government. Indeed, the Senate Budget Committee recently held hearing about creating a bipartisan commission to find solutions to America’s entitlements problems.
The U.S. is in real entitlement trouble. We may need to resort to what will be considered drastic and unpopular solutions soon.

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