BuckeyeBlog

Sen. Max Baucus unveiled his health care plan yesterday and one of its main selling points is that it won’t add to the deficit, according to CBO’s score for the bill. Most of the Baucus bill’s costs would be paid for by reducing spending on Medicare. As Peter Suderman over at Reason magazine’s blog points out, though, the CBO also issued this warning about how unlikely it is that Congress will actually reduce Medicare’s spending:

These projections assume that the proposals are enacted and remain unchanged throughout the next two decades, which is often not the case for major legislation. For example, the sustainable growth rate (SGR) mechanism governing Medicare’s payments to physicians has frequently been modified (either through legislation or administrative action) to avoid reductions in those payments.

Currently, Medicare payments to physicians are supposed to go down automatically if spending in the program accelerates at too rapid a pace. Congress can override these automatic cuts, though. As CBO point out, Congress often does just this. What CBO doesn’t point out is that Congress does this in response to fierce lobbying by physicians and other providers who benefit from Medicare’s payment rates.

I fail to see anything in the Baucus legislation that will either reduce this lobbying or strengthen the spines of members of Congress to resist it. In short, if you think the Baucus bill won’t add to the deficit, you haven’t been observing Congress very closely.

Tags: Health care

This entry was posted on Thursday, September 17th, 2009 at 3:44 pm and is filed under Accountable Government. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.