Logo

What’s Wrong with the Health Care Media?

Written by John C. Goodman

Share

How many times have you heard that 26-year-olds can be covered by their parent’s health insurance as a result of health reform? Quite a few times I suspect. How about the fact that seniors can get free checkups? Yes, that too.

How about the fact that health reform really isn’t paid for? That half the dollars needed to pay for it will require Medicare cuts so draconian that Congress is unlikely to ever let them take place? Hmm…You don’t remember reading about that? What about the fact that families at the same income level will get vastly different subsidies under the reform — differences that amount to $10,000 a year or more? Ahh…You didn’t read about that either?

Here’s the problem. The first two facts — the ones you hear about often — are trivial. The second two facts — the ones you never hear about — are deadly serious.

So what’s going on? In a nutshell, the mainstream media depends on health reporters for news about the Affordable Care Act (ObamaCare). But the health reporters aren’t functioning like real reporters these days. All too often they are uncritically passing along messages that appear in White House press releases. Or, they are allowing politicians and agents of the Obama administration to spin the effects of health reform without serious challenge.

No, I don’t believe you.

 Let’s review the bidding. In general, 26-year-olds are the healthiest population group in our society. If you are really serious about health reform, they are the last people you should be talking about. [BTW, won't 26-year-olds turn 27 a year hence and then be ineligible for their parent's coverage? I haven't heard a single commentator mention that fact.] As for free checkups for seniors, I believe that every study that has ever been done has shown that checkups for healthy people do not save money. This is just one of a whole slew of medical services we could jettison without any serious harm.

So why are we talking about these things? There isn’t any reason unless you are a politician running for office. I don’t even have to run a focus group to know that most people dislike or could care less about the great bulk of ObamaCare. But most people have children. A lot of them have grandchildren. Those children will someday reach the age of 26. What parent or grandparent doesn’t want their kids to get health insurance, especially if it sounds like the whole thing is a free lunch?

Ditto for the elderly. Even if they don’t take advantage of the offer, what senior is going to be opposed to the opportunity to get a free check up every year? And if the offer is combined with misleading rhetoric about how preventive medicine saves money, the checkup begins to sound like another free lunch.

Consider another benefit that’s turning out to be trivial. On the eve of the passage of the ACA, every single proponent focused on one issue and one issue only: pre-existing conditions. In fact, they talked about it so much you would have thought that it was the most serious domestic problem the country faced. Yet for the past two years, people denied health insurance because of a pre-existing condition have been able to buy insurance at the same rates that healthy people pay. About 62,000 have done so. For those 62,000 the ACA may be a godsend. But we don’t need to spend $1.8 trillion over the next ten years to solve the problems of 62,000 people. As with the other “benefits,” this one is relatively trivial in the grand scheme of things.

Let’s try one more question. How many times have you heard it said that while the public doesn’t like the Affordable Care Act, people like a lot of the provisions of the act? Really? What provisions? Oh, the trivial provisions. The cost of the 26-year-old provision is too miniscule to bother with. Let’s take the checkups. If every senior in America took advantage of this benefit (which they can’t because the act does not create any new doctors) the total cost would be less that 2% of the cost of health reform. The cost of insuring people with pre-existing conditions appears to be less than 1%!

Now let’s turn to a serious matter that never makes it into your morning newspaper. Look at the graphs below, taken directly from the Medicare Office of the Actuary’s memorandum in response to the 2012 Medicare Trustees report. In about two years, Medicare payments to doctors will fall below Medicaid rates and will fall further and further behind Medicaid with each passing year. Medicare payments to hospitals will basically match the Medicaid rate, indefinitely into the future. What will this mean? For one thing, seniors will be lined up behind the welfare mothers in the attempt to find doctors who will see them and institutions that will admit them. As Harvard health economist Joe Newhouse has explained, seniors will likely have to seek care at community health centers and safety net hospitals. As the Medicare Office of the Actuary has explained, in a few short years, hospitals will begin closing and senior citizens will have increasing difficulty obtaining access to care.

Here is something that has gone totally unreported: no one inside the beltway thinks this will ever happen. The political pressure will be too great. Congress will capitulate. That’s why both the Medicare Trustees and the Congressional Budget Office have put out “alternative estimates,” which is Washington’s way of saying that “the ACA scenario ain’t going to happen.” In fact (in a dramatic break with precedent), the Trustees have made the alternative estimate part of the official Trustees report. In both cases, the estimators are projecting a much higher level of Medicare spending — reflecting political reality.

But, there is another fiscal reality. If Congress caves and restores Medicare funding, that implies higher and higher levels of government debt. Since we cannot keep running up huge deficits forever, funding a brand new entitlement with deficit spending is also a political impossibility.

What about the arbitrary, unfair and sometimes regressive health insurance subsidies? They could force a complete restructuring of American business. Yet even the elite business media outlets have failed to notice. I’ll write more about that in the future.

illustrative-comparison-of-relative-medicare-medicaid

 

illustrative-comparison-of-relative-medicare-medicaid_FIGURE_2

 

SOURCE: John Goodman's Health Policy Blog

John_C._GoodmanJohn C. Goodman is president and founder of the National Center for Policy Analysis, a free-market think tank located in Dallas, Texas.  The Wall Street Journaland the National Journal, among other media, have called him the “Father of Health Savings Accounts.” Dr. Goodman’s health policy blog is the premier right-of-center health care blog on the Internet.  It is the only place where pro-free enterprise, private sector solutions tohealth care problems are routinely examined and debated by top health policy experts across the ideological spectrum.

 

You are now being logged in using your Facebook credentials