There will not be many changes until 2014. This is because the administration does not want the public to experience the huge cost increases and mandates until after the mid-term elections in November and the Presidential election in 2012. See the timeline for changes for dates on when changes are scheduled to be implemented.

The administration is well aware that premiums will continue to rise because underlying health care costs are increasing at an unsustainable and possibly unstoppable rate. Nothing in the Healthcare Reform bill will stop the increases.

Harry Reid has said on several occasions that the true cost will be $2 trillion over 10 years.

$533 billion of the money will come from Medicare Cuts (see details below).

This year most of the Healthcare reform changes cost almost nothing!
 
In September 2010 we will see bans on insurance lifetime limits. Very few people exceed their typical $5 million or $6 million lifetime limit now so it will cost almost nothing! Also at age 65 most people go on to Medicare. Medicare Supplements don’t have financial limits so that too will cost nothing!

Dependent children will be allowed to stay on their parents' insurance policies a few years longer (until age 26), another benefit that costs almost nothing.

There will be a high risk pool for qualified uninsured residents with pre-existing health conditions. They must be without insurance for six months and will be required to pay premiums that are similar to those paid in a "standard population" for insurance. We already have high risk pools in California (see my previous newsletter)!

A $250 rebate will be available for the “Doughnut Hole” in Part D of Medicare.

This only affects the people who reach that gap.

Rescissions of policies will not be allowed and children cannot be denied coverage if they have a pre-existing condition.

All the above changes will take place this year and cost relatively little. With moderate expenditure these changes could be improved upon and would meet all of our healthcare requirements. So why do we need to spend another one or two trillion dollars? Spending more money won’t stop premium increases, but it will create a massive bureaucracy!

Will the new reform laws apply to everyone?

When will these changes occur?

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Changes To Traditional Medicare

In order to help pay for Healthcare reform, money is being taken from Medicare!

Many people mistakenly thought that the Medicare cuts only apply to Medicare Advantage; however, the latest figures show that $136 billion will be taken from Medicare Advantage, but $397 billion will be taken from Traditional Medicare.

Gross cuts in projected payments to insurers, hospitals and other providers total $533 billion over 10 years, according to a preliminary analysis by the Kaiser Family Foundation.

About $100 billion will be plowed back into Medicare, leaving a net cut of $428 billion.

We will not feel the effects of these cuts until after the elections.

Medicare needs every penny it can get. Why is it being used to finance Healthcare Reform?

Answer: Because it is easier for politicians to steal money from Medicare than it is to persuade their constituents to cough up another 500 billion dollars for an unnecessary bureaucracy.

One of the side effects of cuts to Medicare is that Medicare is one of the principle sources of funding for teaching hospitals. Experts predict a substantial shortage of doctors in the future that will likely be compounded by the reform legislation.

As Ranks of Insured Expand, Nation Faces Shortage of 150,000 Doctors in 15 Years

WHERE COULD CUTS TO MEDICARE BE MADE?

The rules for Medicare are contained within the laws of the Social Security Act. House Resolution 3590, also known as the Health Care Reform Bill, changed several clauses in the Social Security Act which allows for cuts in the original Medicare program. There is wording common to these changes that allow an increase factor being less than 0.0 for a year, that may result in payment rates under the payment system under this paragraph for a year being less than such payment rates for the preceding year. Prior to the changes, the laws did not allow for these decreases. H.R.3590 does not seem to specifically state that these services will be reduced so much as it allows for them to be reduced. If Medicare funding is going to be cut by hundreds of billions of dollars then the cuts will have to be made in the areas where cuts can actually occur as stated in the newly amended Social Security Act.

Below is a brief summary of the portion of H.R.3590 regarding areas in the original Medicare program where benefit reductions will be able to be made as a result of the passage of health care reform.

Inpatient Acute Hospitals - Section 1886(b)(3)(B) of the Social Security Act (42 U.S.C. 1395ww(b)(3)(B)), as amended by section 3001(a)(3), is further amended

ADJUSTMENT- For fiscal year 2012 and each subsequent fiscal year, after determining the percentage described in clause (i), the Secretary shall reduce such percentage by the productivity adjustment described in section 1886(b)(3)(B)(xi)(II). The application of the preceding sentence may result in such percentage being less than 0.0 for a fiscal year, and may result in payment rates under this subsection for a fiscal year being less than such payment rates for the preceding fiscal year.

Skilled Nursing Facilities - Section 1888(e)(5)(B) of the Social Security Act (42 U.S.C. 1395yy(e)(5)(B)) is amended

ADJUSTMENT- For fiscal year 2012 and each subsequent fiscal year, after determining the percentage described in clause (i), the Secretary shall reduce such percentage by the productivity adjustment described in section 1886(b)(3)(B)(xi)(II). The application of the preceding sentence may result in such percentage being less than 0.0 for a fiscal year, and may result in payment rates under this subsection for a fiscal year being less than such payment rates for the preceding fiscal year.’

Long-term Care Hospitals - Section 1886(m) of the Social Security Act (42 U.S.C. 1395ww(m)) is amended

SPECIAL RULE- The application of this paragraph may result in such annual update being less than 0.0 for a rate year, and may result in payment rates under the system described in paragraph (1) for a rate year being less than such payment rates for the preceding rate year.

Home Health Agencies - Section 1895(b)(3)(B) of the Social Security Act (42 U.S.C. 1395fff(b)(3)(B)) is amended

The application of this clause may result in the home health market basket percentage increase under clause (iii) being less than 0.0 for a year, and may result in payment rates under the system under this subsection for a year being less than such payment rates for the preceding year.’

Psychiatric Hospitals - Section 1886 of the Social Security Act, as amended by sections 3001, 3008, 3025, and 3133, is amended

The application of this paragraph may result in such update being less than 0.0 for a rate year, and may result in payment rates under the system described in paragraph (1) for a rate year being less than such payment rates for the preceding rate year.

Hospice Care - Section 1814(i)(1)(C) of the Social Security Act (42 U.S.C. 1395f(i)(1)(C)), as amended by section 3132, is amended

The application of the preceding sentence may result in such increase factor being less than 0.0 for a year, and may result in payment rates under the payment system under this paragraph for a year being less than such payment rates for the preceding year.’

Dialysis - Section 1881(b)(14)(F) of the Social Security Act (42 U.S.C. 1395rr(b)(14)(F)) is amended

For 2012 and each subsequent year, after determining the increase factor described in subclause (I), the Secretary shall reduce such increase factor by the productivity adjustment described in section 1886(b)(3)(B)(xi)(II). The application of the preceding sentence may result in such increase factor being less than 0.0 for a year, and may result in payment rates under the payment system under this paragraph for a year being less than such payment rates for the preceding year.’

Outpatient Hospitals - Section 1833(t)(3) of the Social Security Act (42 U.S.C. 1395l(t)(3)) is amended

The application of this subparagraph may result in the increase factor under subparagraph (C)(iv) being less than 0.0 for a year, and may result in payment rates under the payment system under this subsection for a year being less than such payment rates for the preceding year.

Ambulance Services - Section 1834(l)(3) of the Social Security Act (42 U.S.C. 1395m(l)(3)) is amended

‘The application of subparagraph (C) may result in the percentage increase under subparagraph (B) being less than 0.0 for a year, and may result in payment rates under the fee schedule under this subsection for a year being less than such payment rates for the preceding year.’

Ambulatory Surgical Center Services - Section 1833(i)(2)(D) of the Social Security Act (42 U.S.C. 1395l(i)(2)(D)) is amended

The application of the preceding sentence may result in such update being less than 0.0 for a year, and may result in payment rates under the system described in clause (i) for a year being less than such payment rates for the preceding year.’

Certain Durable Medical Equipment - Section 1834(a)(14) of the Social Security Act (42 U.S.C. 1395m(a)(14)) is amended

‘The application of subparagraph (L)(ii) may result in the covered item update under this paragraph being less than 0.0 for a year, and may result in payment rates under this subsection for a year being less than such payment rates for the preceding year.’

The full text of the bill is available at: http://www.opencongress.org/bill/111-h3590/text

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