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The Centers for Medicare & Medicaid Services' (CMS) Assessment of Medicare Cuts Under HR 3962
On November 13, CMS released estimates of the "costs, savings, and coverage impacts" of HR 3962, showing Medicare spending will be cut by a draconian $570.6 billion, well above the CBO figure. Enrollees unable to cover the difference will be devastated. Millions will get less care when they most need it. In some cases, hospitals and nursing homes may deny it altogether.
Medicare will introduce "permanent annual productivity adjustments to price updates for institutional providers" to maximize "efficiency" - costing $282 billion, over half the total cuts. They'll affect acute care hospitals, nursing facilities, and home health agencies, and be based on economic productivity overall, but CMS notes that:
"Except in the case of physician services, we are not aware of any empirical evidence demonstrating the medical community's ability to achieve productivity improvements equal to those of (the) overall economy."
As a result, provider costs will rise faster than Medicare payment increases. They, in turn, will reduce care or opt out of the program altogether. Many providers have done it because of low compensation. CMS states:
"Providers for whom Medicare constitutes a substantive portion of their business could find it difficult to remain profitable and might end their participation in the program (possibly jeopardizing access to care for beneficiaries)."
Medicaid eligibility will also be impacted, threatening access for millions of poor people, dependent on it as their sole source of care. Although HR 3962 increases spending by $77.5 billion to cover the cost of new enrollees, CMS says higher demand may cause providers:
"to accept more patients who have private insurance (with relatively attractive payment rates) and fewer Medicaid" ones because it won't be cost effective to do it.
Physicians for a National Health Program (PNHP) on Myths and Facts about a Public Option
Myth: More choice.
Fact check:
Provider and location choices will be limited. Seeking care outside networks will cost more, and authorization will still be required.
Myth: Patients may keep their doctors regardless of employment changes or health.
Fact check:
The employer-based system stays intact. If a new plan is chosen, only doctors in it may be accessed. Patients retaining their own will incur higher out-of-network fees. Insurers may also cherry pick the healthy and avoid the sick. Patients becoming ill risk losing employer-based coverage or face higher premiums to keep it.
Myth: Private insurers will have to compete on a level playing field.
